The federal government is proposing small business tax changes that they say will make the system more fair – accountants and small businesses disagree. How will the 2017 tax changes effect you? Who will they effect? Below is a very simplified overview of who will be effected? If you answer yes to any of the below you should talk to us or your accountant.
- Do you earn money in your business?
- Do other family members earn money in your business?
- If they do (spouse, Children…) then your taxes will be going up if the changes are accepted.
- Would you pay your family members the same amount if they were not part of your company?
- Are they actively working in the company for the money they receive?
- Do you have investments in your company that are earning income/ interest?
- If the proposed changes go through then these will be taxed differently
- This should not effect investments that are already invested but it might.
- Are you holding money in your company to use as income later?
- Are you holding money in your company for future growth or asset purchase?
- Do you have a holding company?
- Overall your tax bill will go up.
The government is currently saying this: Proposed tax changes
The accountants are against these changes – CPA News – updated frequently
Overall, if you have a small business these 2017 tax changes could greatly increase your tax burden. If you were considering opening a holding company or getting family members to buy into your company you might want to wait until all the new tax changes are finalized.
Get involved and make your voice heard before these changes become finalized – talk to your accountant today or sign the CFIB petition and fill out their survey so that they can advocate for small businesses on your behalf.