Congratulations!
You decided to take the leap of faith and pursue your dream of working for yourself. As a self-employed individual, one way to report your business activities is through your personal taxes.
Another method is to incorporate a company.
It is totally fine to go the personal taxes route as many folks decide that is best for them. The key here is to keep a detailed record of all sales and expenses as you grow your business. There are many expenses that are eligible business expenses that will offset the income you earn and subsequently reduce your tax burden as your business grows.
Let’s also not forget about GST as the CRA requires that you register and collect GST once your sales hit $30k in the tax year.
As a final note, it is always recommended to think about your future financial goals. Do you want to buy a house? Car? Is incorporation the best strategy as it promotes cash flow flexibility?
It is an exciting time for you yet also a great time to partner with an accountant. Your accountant will help you navigate through your business and tax related questions so you can maximize your time and energy on the important stuff – your business!