A sole proprietorship is an unincorporated business that is owned by one individual. The owner of a sole proprietorship has sole responsibility for making decisions, receives all the profits, claims all losses, and does not have separate legal status from the business. If you are a sole proprietor, you also assume all the risks of the business. The risks extend even to your personal property and assets.
If you are a sole proprietor, you pay personal income tax on the net income generated by your business. It is important to understand your tax filing requirements, as they differ from the taxes of a regular individual/employee of a company.
To discuss these tax filing requirements with one of our Accountants, please schedule a consultation at https://calendly.com/stalbertfinancialconsultants. We look forward to hearing from you!
MYTH OR FACT: The Canada Revenue Agency (CRA) may reassess the tax returns within 3 years from the sending of the notice of assessment.
FACT.
Furthermore, returns for which this 3 year period have expired are commonly referred to as being “statute-barred." However, the CRA may reassess a return beyond this period in certain cases, including where: - a waiver of the normal time limits has been timely filed, or - the taxpayer has made a misrepresentation attributable to neglect, carelessness, or willful default or has committed fraud in filing the return or in supplying any relevant information.
Although there are restrictions on when a (re)assessment can be made, these limits do not apply to the periods that the CRA may audit! In other words, while a taxpayer may believe that they cannot be assessed for periods beyond 3 years, the CRA still has the ability to analyze those prior years and ask for information.
Calling all small business owners! Are you characterized as a Sole Proprietorship (SP)?
If so, you have certain tax obligations that you need to be aware of.
For assistance navigating the various tax filing requirements of a SP, please schedule a consultation with SAFC at: https://calendly.com/stalbertfinancialconsultants. We hope to hear from you soon!
IMPORTANT ANNOUNCEMENT! St. Albert Financial Consultants is now offering discounts for seniors.
Not only that, but for clients in Edmonton and the immediate surrounding areas we can actually come pick up and drop off a senior if they are unable to get to our office on their own.
