Thursday, 29 July 2010
 
A Word From Our Accountant


Investments

About Mutual Funds

What is a mutual fund?
A mutual fund is a group of stocks, bonds and other investments that are owned by a large number of investors and managed by a professional investment company. The money you contribute to a mutual fund buys you shares, or units, of that fund.

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Tax Tips Continued...

For better or worse
If your marital status changed during the 2006 tax year, the calculation of benefits and credits paid by the Canada Revenue Agency (CRA) could be affected. You should notify the CRA of the change, in writing, as soon as possible after it takes place, and also updated your marital status on your 2006 tax return.  In some situations, you may be eligible for additional Canada Child Tax Benefit (CCTB) and/or goods and services tax/harmonized sales tax (GST/HST) credit payments. Notifying the CRA of this change also ensures that you are not subject to CCTB or GST/HST credit overpayments, and that your benefit and credit entitlements are correct.
www.cra-arc.gc.ca/benefits/marital-e.html

 

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Tax Tips

Individuals can claim a non-refundable tax credit for public transit passes. You will be able to claim the cost of buying a monthly (or longer duration) pass for commuting on busses, streetcars, subways, commuter trains and local ferries for this proposed non-refundable tax credit. You can claim the full amount paid for a public transit pass, or for the cost of passes for multiple transit systems, for the amounts you have paid for travel that occurred after June 30, 2006. You can include the cost of passes for yourself, your spouse or common-law partner or your children under age 19. You will need to keep the expired monthly transit passes for the months after June 2006 to support your claim. www.transitpass.ca

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RRSPs and You
Millions of Canadians contribute to a Registered Retirement Savings Plan (RRSP) every year. These plans play an important role in ensuring that individuals have adequate financial resources in their retirement years. Surveys show that a majority of Canadians don't have a financial plan to reach their goals.

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Keep good books or risk having the book thrown at you

Keeping complete, organized financial, and tax records is well worth the effort.

Keeping organized books and records of your income and expenses not only helps to fill out income tax returns, it may keep you out of jail.
 
According to the Income Tax Act, every person carrying on business and every taxpayer is required to keep records and books of account at their place of business and residence. The records must be in such a form and contain information that will enable the calculation of taxes payable. By "record" Canada Revenue Agency ( CRA) means any document containing information relevant to the determination of a taxpayer's liability for tax. This could include letters, diagrams, or even notes on a napkin. The only way to prevent disclosure of such documents is to ensure they fall under solicitor-client privilege.

Failing to keep proper books, that is, records to determine taxes payable, is an offence under the Income Tax Act, which on summary conviction could bring a fine of $1,000 to $25,000 or the fine and a prison term of up to 12 months. Destruction of books and records for the purpose of escaping tax is a criminal offence that can cost you from 50 per cent to 200 per cent of the tax sought to be evaded and/or up to five years behind bars.

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Accounting Knowledge is a Powerful Tool; it is Key to Success

Accounting is at the heart of business: accounting information pulsates throughout an organization, feeding decision makers with details needed to give them an edge over competitors. Because of new technologies, the increasing speed and quantity of information available makes the task for accountants an ever-increasing challenge. Decision makers cannot rely on hunches and guesses. Decision makers depend on their knowledge of accounting principles and practices to help identify and take advantage of opportunities discovered from reviewing large volumes of information.

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