Self-employed tax services - Full service tax return for self-employed

Being self-employed is complex in many ways. The tax system is no exception! It is difficult to understand the different expenses that are allowed or not in regards to taxes. As a general rule, all expenses incurred by the self-employed to earn income are tax deductible.

Key elements of self-employment taxes

Self-employed individuals are entitled to a number of tax deductions: talk to the experts to find out more.
Depreciation can be an effective tactic for a self-employed person: ask our professionals to analyze your file.
To get the most out of being self-employed, you need to know all the tax laws that apply to this situation.

Taxes for self-employed workers - A tax challenge

Being self-employed is complex in many ways. Taxation is no exception! It is difficult to understand the different expenses that are allowed or not allowed with regards to taxes. As a general rule, all expenses incurred by the self-employed to earn income are tax deductible. These measures reduce the taxable income of the self-employed person.

What is the difference between a self-employed person and an employee?

An individual who is self-employed is working in his own interest to generate a profit. He is in control of all his operations and clients.
An individual who works as an employee commits to perform his work in exchange for a salary paid by a company. He or she works under the control of a company for a period of time agreed upon by both parties (employment contract).

The self-employed person's tax return can include several eligible expenses that reduce their tax burden

Self-employed individuals must report their total income, but are eligible to claim the following expenses on their tax return (non-exhaustive list):

Advertising;
Meals and entertainment expenses;
Bad debts;
Insurance;
Interest and bank charges;
Professional fees;
Office expenses;
Management and administration fees;
Rent;
Repairs and maintenance;
Property taxes;
Travel expenses;
School taxes;
Travelling expenses;
Electricity.

Take advantage of eligible expenses and business expenses when filing your income tax return

Contact Barricad

Why trust Barricad with your self-employed taxes?

Not taking advantage of all the tax deductions to which you are entitled as a self-employed person is a costly mistake! If you are self-employed, there are many opportunities to save on your annual income tax return, however it takes good tax knowledge and familiarity with the Canada Revenue Agency. This is where Barricad's tax experts are extremely helpful!

A self-employed person has tax obligations towards Revenue Quebec and Revenue Canada, but also advantages!

A self-employed person is eligible to claim a capital cost allowance for the equipment or material he uses in his business. For example, a computer purchased for $1,500 will give the right to a capital cost allowance in the year of acquisition ($1,500 * 50% * 55%) and in the following years. The depreciation expense in subsequent years will be the undepreciated balance multiplied by 55%.

In addition, there are various techniques such as cash damming to turn non-deductible interest into deductible interest and save tax dollars. The best way to optimize your tax return while respecting the standards of tax authorities such as Revenue Canada and Revenue Quebec is to work with an experienced tax specialist!

As a self-employed person, you can deduct home office expenses

Self-employed individuals are also eligible, under certain conditions, to claim home office expenses. In fact, the tax preparer must absolutely ask himself what expenses are eligible for an individual depending on his specific situation. Each sector of activity has its own tax differences.

Many business expenses are tax deductible if you are self-employed

Travel expenses related to the business activity;
50% of meal expenses (when traveling or meeting with clients);
Expenses related to business travel, such as hotels;
Expenses for conferences, training courses or professional associations;

Social security contributions must be included in your self-employment tax return

There are differences and distinctions between the federal and provincial tax returns. In addition, self-employed individuals are required to make contributions to the:

Quebec Pension Plan (QPP) or Canada Pension Plan (CPP);
Quebec Parental Insurance Plan (QPIP) or Employment Insurance Plan;
Quebec Health Insurance Plan (RAMQ);
Health Services Fund (HSF);

Do you have a question about self-employment taxes?

You have questions or would like to meet with one of our experts? Barricad's tax specialists can assist you and answer your questions on self-employment taxes. For more information and to get the most out of your tax returns, don't hesitate to contact us, we will be happy to guide you!

Learn more about self-employment taxes

What are the criteria to be a self-employed worker for tax purposes?

Several criteria are established by Revenu Québec to define an individual as a self-employed person for tax purposes, for example

A self-employed person generally owns his or her work tools;

A self-employed person performs a specific service for a specific purpose for a client.

As a self-employed person, am I taxed as an individual, a corporation or a sole proprietorship?

A self-employed person who receives income through a sole proprietorship will be taxed in the same manner as an individual. This status, in the eyes of Revenu Québec, only changes when the individual is incorporated or legally separated from his business. In this situation, two income tax returns will have to be prepared: one covering the business income and expenses and the other for the individual's personal income tax.

Would you like to meet a tax specialist?

Make an appointment

Other tax services

Estate Tax - Taxation of Deceased Persons

A deceased person's tax obligations can be more complex than one might think. Not only do executors have to deal with all the legalities surrounding the death of their loved one, but they also have to deal with the fiscal requirements of a different tax return. Working with a tax professional can lighten your burden and make this step easier and faster. Barricad's tax professionals have the necessary experience to guide you through the estate tax process with respect.

Corporate reorganization

A corporate structure that meets the needs of entrepreneurs is the first step to saving taxes and facilitating the transfer of funds.

Relève d'entreprise

La relève d'entreprise, ça se prépare longtemps d'avance, avant même que le relevé pense à sa retraite! Chaque situation est différente et amène ses particularités émotionnelles et fiscales. Parce que nous avons l'habitude de ce type de dossier, chez Barricad, nous traitons ces aspects dans cet ordre.

Estate planning - Protect your wealth to transfer your assets to your loved ones

It is never pleasant to talk about what will happen when we leave… On the other hand, it is important to plan your estate well so that your assets are distributed in the way you wish. Planning today means conserving assets, protecting your wealth and a lasting legacy for your family in the future. Work with Barricad for Wealth Management Solutions!

Tax planning - Reduce your taxes with tax planning services

The tax universe is very complex. The objective of tax planning is to organize a taxpayer's affairs so that he or she pays the least amount of federal and provincial taxes possible while respecting the laws. The main advantage is to make the most of all the deductions, exemptions, credits, abatements and others that are contained in the law.

Retirement planning - Maximize your retirement income with retirement planning services

Retirement, as well as early retirement, is obviously planned several years in advance. Business owners often have more choices, but also more responsibility when it comes to planning for retirement. Although many entrepreneurs believe they will never retire (!), they should think about it several years in advance in order to choose the right tools. Financial planning is necessary at all times, especially to save enough money for a comfortable retirement.

Incorporating a business - Incorporate a business in Quebec

Entrepreneurs have a thousand questions when it comes to starting a business in Canada and Quebec as well as Canadian corporations. Take an hour of your time and come meet with one of our tax specialists. He or she will be able to answer all your questions and, better yet, ask you the important questions that will allow your project to start the right way!

Self-employed tax services - Full service tax return for self-employed

Business Succession

Business succession is prepared well in advance, even before the employee thinks about retirement! Each situation is different and brings its own emotional and fiscal particularities. Because we are used to this type of situation, at Barricad, we treat these aspects in this order.

Property Tax - Work with a Property Tax Accountant

The taxation related to real estate investors is particular. The complexity varies from one case to another, but even for a case qualified as "not very complex", tax decisions can have a major impact on the individual's taxation in the short, medium or long term.

Tax report - Trust tax experts for your tax preparation services

At Barricad, we take the preparation of tax returns very seriously. Each year, our tax specialists save our clients thousands of dollars thanks to their expertise and knowledge in this area.

Merger and liquidation

Is your organization experiencing significant losses or is it going out of business? Is it better to merge with another organization or to simply dissolve it? It is clear that it is not easy to make such a decision. This is why Barricad Fiscalists are here to advise you in this process.

International Taxation

Behind your foreign projects lie several tax challenges that require careful planning. Whether it is for a company or an individual, doing business outside of Canada requires judicious financial and tax planning.

Agricultural Taxation - Work with an agricultural tax specialist

Whether we are talking about breeding, keeping racehorses, cultivating the soil, showing farm animals, raising poultry or fur animals, dairy farming, apple growing or of beekeeping, for the purposes of tax laws we speak of the notion of agricultural enterprise. Several complex rules apply to agricultural businesses. This is why it is important to get help in order to see clearly and avoid unpleasant surprises. Farm taxation can be a complicated matter. Laws and regulations are constantly changing, and it is sometimes difficult to understand your rights and obligations as an agricultural business owner in Quebec. That's why working with a farm tax professional can be a convenient way to manage your tax situation.

Business valuation services - Evaluate your business with Barricad

Knowing the value of your business is more than just a number on a balance sheet: it is fundamental in order to avoid surprises and to plan for the future. Whether it is for litigation, tax purposes, or when an offer to purchase is made, knowing the market value of one's business is crucial, regardless of the type of business: private company, public company, or family business.

Income tax return

The complexity of a tax return can be frightening to many people, despite their good intentions. If you are an individual, a self-employed worker, a property manager or any other person who needs to file a tax return, one of our advisors will be happy to help you.

Declaration of Trust

Grieving the death of a loved one is often an emotional ordeal. For most people, the steps to take following a death are often complex. In fact, a death has many specific implications that must be taken into account when determining the taxes payable by the deceased. At Barricad, we are here to guide you.

Buying and selling a business - buying a business - selling a business

Proceeding with the purchase and sale of a business requires preparation. From negotiation to execution, there are many steps to go through. The confidentiality agreement, the letter of intent, the due diligence, the purchase or sale agreement, the setting up of payment guarantees and the payment according to the planned schedule are the six steps of the purchase or sale of a business. It is important to be well prepared and to know how to position yourself in all the different steps of the process.

Advertising

As a self-employed person, you can deduct the amounts you spend on advertising and promoting your business, including the cost of newspaper ads, business cards, and promotional gifts for potential clients.

Meals and entertainment expenses

The self-employed tax return allows you to declare the amounts you paid for business meals (up to 50%) but also for entertainment expenses (entertainment expenses include for example tickets to a show or a sporting event, awards and the cost of premises for the purpose of providing entertainment).

Bad debts

You can usually deduct an amount for a bad debt if these two conditions are met:

You have established that the debt became uncollectible during the year;
You have already included the amount in your income.

Insurance

You can deduct regular commercial insurance premiums on machinery and equipment you use in your business or self-employment activity.

In order to deduct insurance expenses for your motor vehicle (car, motorcycle, etc.), you must deduct them as motor vehicle expenses.

In addition, you can also deduct regular insurance premiums for the use of your home as a business-use-of-home expense.

Interest and bank charges

You can also deduct interest on money you had to borrow to operate a business or to buy property for business purposes. This can apply to the following interest and bank charges

fees, penalties or premiums paid for a loan
fees that are deductible over a five-year period
expenses that are deductible in the year they are incurred
deductible interest on property you no longer use for business purposes
interest on loans secured by an insurance policy
capitalization of interest
interest for commercial use of your home

Professional fees

You can also deduct professional fees paid to outside firms for advice, services, and consultation.

You can also deduct accounting and legal fees you paid for advice and assistance with bookkeeping. You can also deduct the costs of completing and filing your income tax and GST/HST returns.

Office expenses

You can deduct office expenses. These expenses include small items such as

ballpoint pens
pencils
paper clips
stationery
stamps.

However, the office fee does not include certain items such as:

calculators
filing cabinets
Desks
chairs.

These are considered capital assets for your self-employment tax return.

Management and administrative expenses

On your self-employment tax return, you can deduct management and administration expenses, including bank charges, that you paid to operate your business. Bank charges also include fees for processing payments.

Be careful not to include
salaries, wages and benefits (including employer contributions)
Property taxes;
Rent.

These amounts should be reported separately to qualify as deductible expenses.

Rent

You can deduct rent paid for goods and items you use in your business on your self-employment tax return. This includes rent for the land and the building where you carry on your business.

You must deduct the rent paid for the business use of your home as an expense for the use of the home for business purposes.

Repairs and maintenance

When you file your income tax return as a self-employed person, you can deduct the cost of labour and materials for minor maintenance and repairs to the property you use to earn income from your business.

However, you cannot deduct :

the value of your own labor;
the cost of major repairs that turn out to be capital expenses;
the cost of repairs that are reimbursed to you by your insurer.
These expenses are not deductible.

Property taxes

You can deduct property taxes you spent on property you use in your business, such as property taxes on the land and building where your sole proprietorship is located.

You must deduct property taxes for the business use of your home as a business-use-of-home expense.

Travel expenses

Like travel and meal expenses, travel expenses are deductible on your self-employment tax return.

School taxes

When filing your self-employment tax return, you can deduct school taxes in the same way you can deduct property taxes, electricity or your rent.

Travel expenses

You can also deduct travel expenses you incur to earn business or professional income. These expenses include:

the cost of public transportation;
lodging;
meals.

The cost of meals, beverages and entertainment incurred while travelling is generally subject to the 50% rule to qualify as a deductible expense.

The 50% rule also applies to meals, beverages and entertainment on planes, trains and buses when not included in the ticket price.

Electricity

Just like rent or property taxes, you can deduct your electricity expenses on your self-employment tax return as long as they relate to the space you use to generate income.

Saving for retirement with a PRPP

The PRPP or Group Registered Pension Plan is a retirement savings plan offered to employees, but also to self-employed workers.

Contributions are tax deductible to a certain extent.

‍

Navigation

Bureau - Québec

Bureau - Montréal

Bureau - Mont-Tremblant

Bureau - Magog

Self-employed tax services - Full service tax return for self-employed