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December 2006 Editorial by: Kelly Liese Potvin
The GST.
The majority of any Owner Operators GST cheque is from the ongoing purchases of diesel and repairs. It’s
not unusual for an Owner to spend upwards of a $100,000. per year. That alone can push our GST Rebates
to $1500. per quarter.
Pros for claiming quarterly:
1] Rebates are paid throughout the year.
2] Money is accessible shortly after filing in case of emergencies.
3] Revenue Canada does not pay interest on the GST funds they have been holding onto throughout the
year for annual filers.
4] Paperwork is done at the end of each quarter. This allows the Owner a better look at what his/her
financial standing is, making it easier to prepare steps needed to reduce any taxable income at year end.
5] It makes your Bookkeeper happy.
Pros for claiming yearly:
1] For Owners who have to pay taxes at the end of the year, receiving one large check in Feb/Mar may
work best.
2] Paperwork doesn’t have to be touched until the following year.
As for Cons, what’s great for quarterly, is the con for yearly.
If you’re happy with the filing frequency you have made, then it’s all good. If the decision was made by your
accountant or bookkeeper without discussing the choices available, speak with her/him. It’s never too late
to make changes.
The GST.
The majority of any Owner Operators GST cheque is from the ongoing purchases of diesel and repairs. It’s
not unusual for an Owner to spend upwards of a $100,000. per year. That alone can push our GST Rebates
to $1500. per quarter.
Pros for claiming quarterly:
1] Rebates are paid throughout the year.
2] Money is accessible shortly after filing in case of emergencies.
3] Revenue Canada does not pay interest on the GST funds they have been holding onto throughout the
year for annual filers.
4] Paperwork is done at the end of each quarter. This allows the Owner a better look at what his/her
financial standing is, making it easier to prepare steps needed to reduce any taxable income at year end.
5] It makes your Bookkeeper happy.
Pros for claiming yearly:
1] For Owners who have to pay taxes at the end of the year, receiving one large check in Feb/Mar may
work best.
2] Paperwork doesn’t have to be touched until the following year.
As for Cons, what’s great for quarterly, is the con for yearly.
If you’re happy with the filing frequency you have made, then it’s all good. If the decision was made by your
accountant or bookkeeper without discussing the choices available, speak with her/him. It’s never too late
to make changes.
January 2007 Editorial by: Kelly Liese Potvin
The TL2 – Claim for Meals and Lodging Expenses
There are two ways to claim meals.
The Detailed method- keeping a record book itemizing each expense, and all receipts.
Or, the Simplified method where you do not need to keep any receipts, just a detailed list of your trips. Log
books are great for this!
The meal rate has increased for the 2006 tax year to $17. per meal. A maximum of 3 meals per 24 hour
period may be claimed. The same formula is used for meals in the United States @ $17. US per meal.
Whether you’re a Driver, or an O/O, the total value of meals is reduced by 50%. For example: If you claim
$10,000 in meals, your taxable income is reduced by $5000. Employees (drivers) claim meals and lodging
expenses on line 7 of the TL2. O/O’s claim their expenses on Form T2124, line 8523. For the O/O, claiming
on line 8523 reduces the amount of net taxable income, thus saving O/O’s on CPP payable, provincial tax
credits, etc.
A couple of items you might want to check on last year’s taxes:
Which line were your meal expenses claimed on?
Was GST claimed on the value of meals consumed in Canada?
For more detailed information and an example of what a ‘detailed list of trips’ might look like, please visit:
www.itsallaboutnumbers.com/example.
The TL2 – Claim for Meals and Lodging Expenses
There are two ways to claim meals.
The Detailed method- keeping a record book itemizing each expense, and all receipts.
Or, the Simplified method where you do not need to keep any receipts, just a detailed list of your trips. Log
books are great for this!
The meal rate has increased for the 2006 tax year to $17. per meal. A maximum of 3 meals per 24 hour
period may be claimed. The same formula is used for meals in the United States @ $17. US per meal.
Whether you’re a Driver, or an O/O, the total value of meals is reduced by 50%. For example: If you claim
$10,000 in meals, your taxable income is reduced by $5000. Employees (drivers) claim meals and lodging
expenses on line 7 of the TL2. O/O’s claim their expenses on Form T2124, line 8523. For the O/O, claiming
on line 8523 reduces the amount of net taxable income, thus saving O/O’s on CPP payable, provincial tax
credits, etc.
A couple of items you might want to check on last year’s taxes:
Which line were your meal expenses claimed on?
Was GST claimed on the value of meals consumed in Canada?
For more detailed information and an example of what a ‘detailed list of trips’ might look like, please visit:
www.itsallaboutnumbers.com/example.
February 2007 Editorial by: Kelly Liese Potvin
Are Tax Deadlines C A R V E D in stone??? You bet they are!
The deadline for an Employee [driver paying deductions such as EI, CPP and Income Tax] is April 30th. An
Owner/Operator has until June 15th to file. BUT any money owing must be received by April 30, or a 5%
penalty and 1% interest per month may be charged. Basically, your return needs to be completed to know
exactly what/if you owe prior to April 30th. But if they owe you, you can hang onto your return until June 15th!
Cool, huh?
Depending on the company you broker/lease with, you should have your December earnings income and
expense statements by February. Technically it is possible to have your taxes prepared prior to the April
30th deadline. But you have to bring/send the information in to your bookkeeper!
Beginning April 1 the CRA will no longer issue GST rebates where there is more than 1 outstanding QTR. For
example, if 3rd and 4th quarters are overdue, they must BOTH be filed before a cheque is issued for either
one.
After registering a business for GST, returns are sent by regular mail for the first year. After that, returns
may be e-filed. E-filing is more convenient, faster, and accurate, eliminating the information from having to
be entered by a third party. Your refund can be direct deposited into your account, usually within 1 – 2
weeks.
Are Tax Deadlines C A R V E D in stone??? You bet they are!
The deadline for an Employee [driver paying deductions such as EI, CPP and Income Tax] is April 30th. An
Owner/Operator has until June 15th to file. BUT any money owing must be received by April 30, or a 5%
penalty and 1% interest per month may be charged. Basically, your return needs to be completed to know
exactly what/if you owe prior to April 30th. But if they owe you, you can hang onto your return until June 15th!
Cool, huh?
Depending on the company you broker/lease with, you should have your December earnings income and
expense statements by February. Technically it is possible to have your taxes prepared prior to the April
30th deadline. But you have to bring/send the information in to your bookkeeper!
Beginning April 1 the CRA will no longer issue GST rebates where there is more than 1 outstanding QTR. For
example, if 3rd and 4th quarters are overdue, they must BOTH be filed before a cheque is issued for either
one.
After registering a business for GST, returns are sent by regular mail for the first year. After that, returns
may be e-filed. E-filing is more convenient, faster, and accurate, eliminating the information from having to
be entered by a third party. Your refund can be direct deposited into your account, usually within 1 – 2
weeks.
March 2007 Editorial by: Kelly Liese Potvin
Receipts? Should you hand them in??? YES!!!
Recently an owner/operator stopped in after meeting with a *truck driver who does books* that his friend
had suggested. After all, his friend has been using this guy for years. However, after speaking with his
friend’s *bookkeeper* the gentleman decided against him. The advice that he had received from his well
intentioned friend was bad. And he was smart enough to realize it.
The truck-driver / bookkeeper suggested my client save all of his border crossings and fax receipts to claim
on his taxes., thus reducing his taxable income. Great idea, IF you can’t hand them in to the company for full
reimbursement. Usually, you can, and you should.
The difference is, would you rather get 100% of your money back by handing in your receipts, OR… save
them to claim on your taxes, possibly reducing your TAXABLE [if you have one] income? For ex: if you had a
taxable income of $20,000 and claimed an additional $1,000 in receipts, RATHER than taking the $1000 in
cash, you may reduce your tax payable by $150. or so. TAKE THE MONEY!!! Use it to pay for an educated
bookkeeper. You will be glad you did! For questions to ask when selecting a bookkeeper, read my article in
the Nov/06 issue of OTN.
Just a reminder… Tax filing deadline for personal tax returns is April 30. Self-Employed tax returns are due
by June 15, however, any balance owing must be paid by April 30th !
If you have any questions you would like to see answered here, please send them to:
kelly@itsallaboutnumbers.com
Receipts? Should you hand them in??? YES!!!
Recently an owner/operator stopped in after meeting with a *truck driver who does books* that his friend
had suggested. After all, his friend has been using this guy for years. However, after speaking with his
friend’s *bookkeeper* the gentleman decided against him. The advice that he had received from his well
intentioned friend was bad. And he was smart enough to realize it.
The truck-driver / bookkeeper suggested my client save all of his border crossings and fax receipts to claim
on his taxes., thus reducing his taxable income. Great idea, IF you can’t hand them in to the company for full
reimbursement. Usually, you can, and you should.
The difference is, would you rather get 100% of your money back by handing in your receipts, OR… save
them to claim on your taxes, possibly reducing your TAXABLE [if you have one] income? For ex: if you had a
taxable income of $20,000 and claimed an additional $1,000 in receipts, RATHER than taking the $1000 in
cash, you may reduce your tax payable by $150. or so. TAKE THE MONEY!!! Use it to pay for an educated
bookkeeper. You will be glad you did! For questions to ask when selecting a bookkeeper, read my article in
the Nov/06 issue of OTN.
Just a reminder… Tax filing deadline for personal tax returns is April 30. Self-Employed tax returns are due
by June 15, however, any balance owing must be paid by April 30th !
If you have any questions you would like to see answered here, please send them to:
kelly@itsallaboutnumbers.com
April 2007 Editorial by: Kelly Liese Potvin
Taxes? Due? Are you sure???
This is it. The month my taxes are due. Has it really been a whole year? Last April I told myself that I wouldn’t
procrastinate. I would get my stuff in early, GETURDONE.
Now, as I frantically gather up my receipts and statements, well, the ones I can find, I shake my head.
Sheesh. I go through this year after year. I hate tax time. Every year I tell myself next year will be different. I’
ll put all my receipts and statements in one envelope, when I receive them. Keep all my log books in one
place. I KNOW I didn’t take the summer off, even if I am missing July and August! Arghhhhhhhhhhh. Next
year will be so different…
Most people have heard about Lady Godiva’s infamous nude horseback ride through the streets of
Coventry. Not everyone knows what was behind it. The story is Lady Godiva had begged her husband,
Leofric, Earl of Mercia, to lessen the people’s tax burden. Leofric agreed to… with one stipulation. Lady
Godiva had to ride through town on her horse, wearing only her smile. As a gesture of respect and
appreciation for Lady Godiva's actions on their behalf, the people of Coventry stayed indoors behind
shuttered windows, to preserve her modesty as she passed. To Leofric’s credit, he completely eliminated
taxes; except for tolls on, curiously enough, horses. And, Lady Godiva became an instant heroine to the
common people of Coventry.
Now, find that paperwork!!!
If you have a question you would like to see answered here, please send it to kelly@itsallaboutnumbers.com.
Taxes? Due? Are you sure???
This is it. The month my taxes are due. Has it really been a whole year? Last April I told myself that I wouldn’t
procrastinate. I would get my stuff in early, GETURDONE.
Now, as I frantically gather up my receipts and statements, well, the ones I can find, I shake my head.
Sheesh. I go through this year after year. I hate tax time. Every year I tell myself next year will be different. I’
ll put all my receipts and statements in one envelope, when I receive them. Keep all my log books in one
place. I KNOW I didn’t take the summer off, even if I am missing July and August! Arghhhhhhhhhhh. Next
year will be so different…
Most people have heard about Lady Godiva’s infamous nude horseback ride through the streets of
Coventry. Not everyone knows what was behind it. The story is Lady Godiva had begged her husband,
Leofric, Earl of Mercia, to lessen the people’s tax burden. Leofric agreed to… with one stipulation. Lady
Godiva had to ride through town on her horse, wearing only her smile. As a gesture of respect and
appreciation for Lady Godiva's actions on their behalf, the people of Coventry stayed indoors behind
shuttered windows, to preserve her modesty as she passed. To Leofric’s credit, he completely eliminated
taxes; except for tolls on, curiously enough, horses. And, Lady Godiva became an instant heroine to the
common people of Coventry.
Now, find that paperwork!!!
If you have a question you would like to see answered here, please send it to kelly@itsallaboutnumbers.com.
May 2007 Editorial by: Kelly Liese Potvin
Receipts
As deadline approaches I’m wondering how many of you haven’t had the opportunity to do your taxes yet. I
started mine, a good month ago. Just never got back to it. By the time you read this in print, I am hoping,
beyond all hope, that I have completed mine and sent it in. And you have too! Even if you don’t have the
money to send in [if you owe] you won’t be charged the 5% penalty for late-filers. A payment can always be
sent in later.
To make tax time easier next year here are a few ideas…
I give my clients a 9x12 plastic envelope to carry in their truck specifically for receipts. When they hand it in,
preferably monthly, I hand over a new envelope. A sample list of receipts are: truck repairs and
maintenance, truck wash, windshield washer fluid, tolls/scales, air fresheners, cell phone accessories,
phone cards, hotel, lumpers, truck refrigerator/microwave/toaster/xm radio, cell phone bills, contractor [pay]
statements and showers. Unlike the Meals Expense, showers are not a 'given'. You need your shower
receipts to claim the expense.
Personally, I prefer not to receive meal receipts UNLESS you spend an average of more than $51. Per day,
every day your on the road and have all the receipts to back it. Odds are your better off claiming the $51.
If you have concerns about your tax return, the preparer’s qualifications or your refund/payment owing,
have your tax return checked over by a different bookkeeper. It might cost you a few more dollars, but it will
give you piece of mind. And you will feel more comfortable with the choice you made next year. And, you
can write it off!
If you have a question you would like to see answered here, please send it to: kelly@itsallaboutnumbers.com
Receipts
As deadline approaches I’m wondering how many of you haven’t had the opportunity to do your taxes yet. I
started mine, a good month ago. Just never got back to it. By the time you read this in print, I am hoping,
beyond all hope, that I have completed mine and sent it in. And you have too! Even if you don’t have the
money to send in [if you owe] you won’t be charged the 5% penalty for late-filers. A payment can always be
sent in later.
To make tax time easier next year here are a few ideas…
I give my clients a 9x12 plastic envelope to carry in their truck specifically for receipts. When they hand it in,
preferably monthly, I hand over a new envelope. A sample list of receipts are: truck repairs and
maintenance, truck wash, windshield washer fluid, tolls/scales, air fresheners, cell phone accessories,
phone cards, hotel, lumpers, truck refrigerator/microwave/toaster/xm radio, cell phone bills, contractor [pay]
statements and showers. Unlike the Meals Expense, showers are not a 'given'. You need your shower
receipts to claim the expense.
Personally, I prefer not to receive meal receipts UNLESS you spend an average of more than $51. Per day,
every day your on the road and have all the receipts to back it. Odds are your better off claiming the $51.
If you have concerns about your tax return, the preparer’s qualifications or your refund/payment owing,
have your tax return checked over by a different bookkeeper. It might cost you a few more dollars, but it will
give you piece of mind. And you will feel more comfortable with the choice you made next year. And, you
can write it off!
If you have a question you would like to see answered here, please send it to: kelly@itsallaboutnumbers.com
June 2007 Editorial by: Kelly Liese Potvin
By the time this is in print I will be either recuperating from all the SENATORS excitement of the BIG win, or
dealing with letters of adjustment. Hopefully, it will be the Ottawa Senators. Just in case… let’s take a look
at the T1-ADJ.
A Letter of Adjustment [T1-ADJ] is a form that is sent in to CRA when a tax return is inadvertently submitted
without all the information. It is easy to overlook a slip of paper, forget about a large
receipt/donation/repair. Or just not know about a certain deduction that the taxpayer may be able to claim,
until it’s to late. Or is it??? You have up to 10 years to revise a past return.
To file a Letter Of Adjustment you have to submit all supporting documentation with your request. If you are
requesting a change to a Line that you have already claimed an amount on, then the previous
documentation has to be submitted as well. For example: If on Line 8860 , you claimed $100. for your
Accounting Fees when it should have been $600. You can claim it now. Be sure to include a copy of your
receipt from your bookkeeper. You can also make changes to multiple lines as long as you have the
supporting documents to send in with the form.
Do you have to use the T1-ADJ? Of course not. You can write out your request on a plain piece of paper. Be
sure to include your name, address, SIN#, tax year you want revised, an explanation of the changes, all
supporting documentation, date and your signature. Mail the completed form and copies of your documents
to your tax office.
You can authorize an individual to request changes on your behalf by signing form T1013. A sample of this
form may be viewed at: www.itsallaboutnumbers.com/sample forms
By the time this is in print I will be either recuperating from all the SENATORS excitement of the BIG win, or
dealing with letters of adjustment. Hopefully, it will be the Ottawa Senators. Just in case… let’s take a look
at the T1-ADJ.
A Letter of Adjustment [T1-ADJ] is a form that is sent in to CRA when a tax return is inadvertently submitted
without all the information. It is easy to overlook a slip of paper, forget about a large
receipt/donation/repair. Or just not know about a certain deduction that the taxpayer may be able to claim,
until it’s to late. Or is it??? You have up to 10 years to revise a past return.
To file a Letter Of Adjustment you have to submit all supporting documentation with your request. If you are
requesting a change to a Line that you have already claimed an amount on, then the previous
documentation has to be submitted as well. For example: If on Line 8860 , you claimed $100. for your
Accounting Fees when it should have been $600. You can claim it now. Be sure to include a copy of your
receipt from your bookkeeper. You can also make changes to multiple lines as long as you have the
supporting documents to send in with the form.
Do you have to use the T1-ADJ? Of course not. You can write out your request on a plain piece of paper. Be
sure to include your name, address, SIN#, tax year you want revised, an explanation of the changes, all
supporting documentation, date and your signature. Mail the completed form and copies of your documents
to your tax office.
You can authorize an individual to request changes on your behalf by signing form T1013. A sample of this
form may be viewed at: www.itsallaboutnumbers.com/sample forms