Small Business Owner in Canada questions.

Hello all, I just recently started up a local seo service company. Registered the business, payed the fees, reserved my name and etc. I'm in Ontario, Canada so I know we have gst/hst. A few quick questions regarding payment/ taxes here in Ontario. Since I operate in Ontario, do I charge every customer gst/hst tax for everything including services?

How does one take payments for credit card/ debt card/ cash and online such as paypal? I've set up a business paypal account to take payment online but how does one take payment offline? Would I need to rent out a debt machine?

I'm currently signed up to Freshbooks to manage billing. I haven't reviewed it fully but I was recommended it. I was also suggested WHMSC but I haven't signed up to it yet. Sorry if my questions seem redundant, I'm just trying to figure out how other business owners in Ontario/ Canada handle income.

Thank you again.

You'll need to get some income 1st, before worrying about what to do with it.

Nigel Farage said:

You'll need to get some income 1st, before worrying about what to do with it.

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This exactly.

It is very expensive running your own company.

So far it hasn't been to bad. I've got 4 clients lined up, this is why I need to know the payment/ billing.

Make sure you keep track of all outgoings and income
Once you start making money, you should look for a part time book keeper,

nanavlad said:

Make sure you keep track of all outgoings and income
Once you start making money, you should look for a part time book keeper,

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Okay, good feedback. So I will look for a book keeper. Next, should I avoid billing/payment systems online like Freshbooks/ WHMSC?

Also, what is the best system/ use to take payments online and offline?

Xoshua said:

Okay, good feedback. So I will look for a book keeper. Next, should I avoid billing/payment systems online like Freshbooks/ WHMSC?

Also, what is the best system/ use to take payments online and offline?

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WHMCS is $300 for a license, and it not easy to setup. I'd stick to Paypal if you're only starting out, you can place buttons on your site after creating them with their interface.

Or you could also pay monthly, but again it's not easy to setup.

Hi,

Obviously all of this needs to be run by your accountant/bookkeeper but I am pretty sure that the GST/HST only applies if within province. If you sell services to someone out of country, AFAIK there's not tax whatsoever. Out of province no PST, only GST. I think.

I haven't tried Freshbooks but I have heard good things about it.. .there's a couple cloud ones. I would look for one that will sync with Paypal and your bank account.

As far as credit/debit. Square has a reader for your smartphone. Could give that a try.

Keep your monthly costs down though. Those eat you alive.

I absolutely love WHMCS, great system, easy to use after you get the hang of it. But if your just starting out with few customers, its probably not necessary. Can always get it later down the road.

Hello,It's always good to consult a good Business Registration Service in Canada.They can solve all your issues regarding business registrations.

You can take credit / debit cards offline with the use of PayPal here. I would post a link but the forum wont let me. A quick google for paypal here should help. I hope its not USA only. They do not offer the best % fee out of all your options but I would imagine its your best option for now if you have a smartphone.

As far as the sales taxes go, I live in California and the only thing you need to charge sales tax on is actual goods. You don't charge sales tax on services rendered. SEO would follow under that category.

I am by no means a CPA or certified to give financial advice by any means. I just want to provide you with my opinion and hope it helps.

In Ontario, when you start out with a business, you have the choice of registering with the GST, or not registering (which as you know is now harmonized - HST).

By law, if you do more than $30,000 in gross revenue, you are required to remit the taxes whether you collect them or not. Many people cannot be bothered with the quarterly remittances and the paperwork, so they do not register until such time as they are required to, especially when they are starting out as a hobby.

But, for many business owners, there are perks to registering when you have not reached the $30k threshhold. For example, if you register, then you must collect the tax, BUT, at the same time, you are permitted to deduct all your own payments of the taxes.

Let's say you buy office supplies, you must keep the receipts and then you deduct the taxes from whatever you collected. You remit the net amount, not the total amount collected.

For newer businesses in the first year, this can be a real positive feature, BECAUSE, you can get back a refund. If you end up spending enough in taxes on purchases for equipment, supplies, and other services, you could effectively spend more than you collect. This happens quite often for newer businesses and hobby businesses.

Also, when you register your business, the gov't usually sends you a package in the mail with all the documents in terms of GST/HST, Workers Comp, and other payroll deduction - even if you don't need these, they send them anyway just to be safe.

As far as invoicing is concerned, depending on the number of invoices you expect to send, paypal will work fine to start. If you only send a couple a week, you can add your logo and so forth to your paypal invoice and customize it accordingly.

If, however, you are sending out ten a day, you might want to look at a more serious accounting solution.

Hope that helps a little.

If you have local expenses, you should participate in your local tax system if the balance of the expenses means that claiming deductions for those will offset your liability in the same system.
If I were you, I'd bill every client online from a Hong Kong company (super cheap to setup and operate) and collect payment via PayPal, and remit just enough 'home' to cover operating costs... your tax then becomes zero. And no, you don't collect HST if you're a foreign company, unless you register a local branch office and participate in the local tax system - which is exactly what I'm suggesting to avoid.

Hey let me know if you have it figured out or are looking for an accountant, since i'm a CPA, based in Toronto.

Sure, Sir for billing and payment you need a trusted plateform, let me discuss with a senior person about, and will send you detailed guideling