Lawn Care Business Forum Lawn Care Business Book Lawn Care Business Blog Lawn Care Software
Home Forum Contract & Flyer Templates Blog Software Videos Podcast Calculators / Estimators Store Mower Review Design It Yourself Lawn Business School

Go Back   GopherHaul Landscaping & Lawn Care Business Marketing Forum > Business > General Business Discussions

General Business Discussions A place to talk about general business discussions.

The evil 5 letter word "TAXES"


General Business Discussions

A place to talk about general business discussions.
Reply
 
Thread Tools Search this Thread
  #11  
Old 07-17-2011, 01:35 PM
justin_time justin_time is offline
Justin
 
Join Date: Apr 2006
Location: French River, ON, Canada
Age: 30
Posts: 1,801
Rep Power: 0
justin_time is on a distinguished road
Default

I'd go buy some RRSP (Registered Retirement Savings Plan) and I'd ask your bookkeeper about it because there's a maximum amount you can claim. The rest I'd leave it in the account. You'll need to budget for the following spring.

That's my 2 cents, hope it helped
Reply With Quote

Stop guess-timating. Learn how to estimate and make money! $$$
Mow Time Estimator Lawn Care Price Estimator Mulch and Topsoil Calculator Snow Plow Estimate Calculator


  #12  
Old 07-18-2011, 01:54 PM
Steve's Avatar
Steve Steve is online now
Administrator
 
Join Date: May 2003
Posts: 38,008
Rep Power: 10
Steve has disabled reputation
Default

Lawn care business tipsLawn Care Business Book
Quote:
I understand what your saying but wouldn't it be nicer to put the $300.00 toward a new weed Whacker instead of giving it to some politician to have a steak dinner ?
I really think you nailed this here. I bet you most people if asked would feel this way. However my take is, it's better to have money in the bank first off. Only buy equipment if you need it.

Money is your business's life's blood. You will need a healthy reserve for all those just in case moments. Like the truck transmission just went out. Or you got sick and needed to take a week, or 2 off.

When you have cash in the bank, you can get over a lot of hurdles that would knock out other smaller or newer lawn care businesses.

A three to six month emergency fund would be a nice goal to have.
__________________
- Subscribe to my Lawn Care Marketing Blog Feed and get daily tips sent to you. Free!
Download your Free trial of Gopher Lawn Care Software.
Reply With Quote
  #13  
Old 07-18-2011, 06:01 PM
Ducke's Avatar
Ducke Ducke is offline
new member
 
Join Date: Nov 2010
Location: The Duck Pond
Posts: 844
Rep Power: 0
Ducke is on a distinguished road
Default

OK I get the part about savings and using your capital for future loans etc.
Maybe I asked my original question wrong ?
Let see if I can elaborate on it a bit more.

If I am taking a monthly wage from my company and then what is left I am putting away in a bank account for the company.
Will I be taxed on what I make salary wise as well as what I make as an LCO ?
If so which is better ? (Tax wise ) a large yearly salary and a small profit in the company or a small salary and a large profit in the bank ?
or should I set an amount (lets say $2000.00) and anything over and above that figure I take to pay my taxes bills loan payments etc and then what ever is left over from all that is my pay (.25 ) and I still have my original $2000.00 in the bank account and then later as I make more Money with more jobs I can up the amount to $3000.00 so on and so on.
I have been doing some reading on this subject but most of the books I have read are from the USA, I finally got a book that is Canadian and that is what confused me even more.
I may have to break down and go speak to an Accountant

Thanks for all the advice it is helping to make something a little clearer.

Graham
Reply With Quote
  #14  
Old 07-19-2011, 08:21 PM
Steve's Avatar
Steve Steve is online now
Administrator
 
Join Date: May 2003
Posts: 38,008
Rep Power: 10
Steve has disabled reputation
Default

Quote:
If I am taking a monthly wage from my company and then what is left I am putting away in a bank account for the company.
Will I be taxed on what I make salary wise as well as what I make as an LCO ?
If so which is better ? (Tax wise ) a large yearly salary and a small profit in the company or a small salary and a large profit in the bank ?
I am not an accountant but here is my view.

Whether you have the money in a company account or a personal account. The income from either is going to be taxed.

If you own the company, both your personal money and the company money is still contributing to your net worth. And it is always better to save your money and only buy what you absolutely need.

In the U.S. there are a bunch of different ways you can register a business. You can be a sole proprietor, have an limited liability corp, s-corp or a c-corp.

Now the c-corp is different from others as far as taxes go. The income from the c-corp is taxed and then the salaries paid out are taxed. So if you own a c-corp, you run into a double taxation. I think that is why the s-corps were created to help smaller business owners avoid this.

Does this help?
__________________
- Subscribe to my Lawn Care Marketing Blog Feed and get daily tips sent to you. Free!
Download your Free trial of Gopher Lawn Care Software.
Reply With Quote
  #15  
Old 07-21-2011, 04:06 AM
picframer's Avatar
picframer picframer is offline
Andy
 
Join Date: Jan 2009
Location: Halifax, Nova Scotia
Posts: 2,885
Rep Power: 11
picframer will become famous soon enough
Default

Steve has it,

Here in Canada in your situation you are a sole proprietor and as such you are going to pay tax on the companies net income and your salary.

If I had time I would sit down and help you however I am going 7 days a week, remember you can apportion a part of your home as a business expense, that includes property tax's, lights, heat, telephone, internet, interest on your mortgage etc.

For the small amount in will cost you talk to your accountant or get a really good bookkeeper.
__________________
Andy
Halifax, Nova Scotia

Last edited by picframer; 07-21-2011 at 04:09 AM.
Reply With Quote
  #16  
Old 12-21-2011, 12:34 PM
SECTLANDSCAPING SECTLANDSCAPING is offline
new member
 
Join Date: Jul 2009
Location: CT
Posts: 1,912
Rep Power: 0
SECTLANDSCAPING is on a distinguished road
Default

Around this time I have a general idea of what Ill pay in taxes. So what I do is buy all my tune up parts for equipment and trucks (belts, blades, plugs, filters, brakes, fluids, tools, tires, chains, trimmer line, bearings). I rather buy it now and get the deduction in a few months then buy it in spring and wait a year to get it back. This is all stuff your going to use either way. It will never hurt to have a extra set of blades a spindle or so on. There small expenses too but they add it.

Sometimes ill purchase equipment that ill need next year. My local mulch yard buys a new truck or loader at this time every year. That can be a gamble though if business becomes slow. Thats why I say get everything to maintain your current equipment now. Then when spring rolls around youll have everything tuned and ready to go.

That would be my advice. Spend what you can, dont spend it all so you make no profit. In a way taxes penalize you for saving and forces you to reinvest earnings.
Reply With Quote
  #17  
Old 12-22-2011, 11:01 AM
Steve's Avatar
Steve Steve is online now
Administrator
 
Join Date: May 2003
Posts: 38,008
Rep Power: 10
Steve has disabled reputation
Default

For those that don't understand this too well, what do you feel are the benefits to purchasing parts or equipment now? How much are they really saving? What is the difference if they buy it now or next year?
__________________
- Subscribe to my Lawn Care Marketing Blog Feed and get daily tips sent to you. Free!
Download your Free trial of Gopher Lawn Care Software.
Reply With Quote
  #18  
Old 12-22-2011, 11:26 AM
SECTLANDSCAPING SECTLANDSCAPING is offline
new member
 
Join Date: Jul 2009
Location: CT
Posts: 1,912
Rep Power: 0
SECTLANDSCAPING is on a distinguished road
Default

Quote:
Originally Posted by Steve View Post
For those that don't understand this too well, what do you feel are the benefits to purchasing parts or equipment now? How much are they really saving? What is the difference if they buy it now or next year?
The main difference is if you buy the parts in march or when something breaks in the summer. Youll be waiting a long time to claim it on your taxes. So its coming out your pocket for a while.

The other factor is for every dollar you didnt spend on parts, youll now pay in taxes. I rather have a extra set of everything then a extra $500 tax payment. So either way the money is gone.

If you buy now. Youll be using end of the year surplus money and getting the money back in the form of a deduction in april.
Reply With Quote
  #19  
Old 12-23-2011, 01:45 PM
Steve's Avatar
Steve Steve is online now
Administrator
 
Join Date: May 2003
Posts: 38,008
Rep Power: 10
Steve has disabled reputation
Default

Quote:
The other factor is for every dollar you didnt spend on parts, youll now pay in taxes. I rather have a extra set of everything then a extra $500 tax payment. So either way the money is gone.
No matter when you buy it, such expenses are still tax deductible right?

The thing I get concerned with is newer business owners tend to take this and run with it and at the end of the year spend everything on stuff they may or may not need.

Ultimately buying parts and writing that expense off as a tax deductible expense really means you are still taking money out of your pocket to purchase the things.

Where something that you can write off as tax deductible is still costing you 70 cents on the dollar isn't it? Depending what your tax bracket is?

It's not like it is free right? If you didn't buy that say $100 part, you would still retain $70 or so after you paid taxes on that $100. So doesn't the question of whether you should buy something like that or not come down to, would you rather have that $70 per $100 in your pocket or would you rather spend it on a part and have a 30% or so discount because you are buying it with non-taxed money?
__________________
- Subscribe to my Lawn Care Marketing Blog Feed and get daily tips sent to you. Free!
Download your Free trial of Gopher Lawn Care Software.
Reply With Quote
  #20  
Old 12-23-2011, 02:48 PM
SECTLANDSCAPING SECTLANDSCAPING is offline
new member
 
Join Date: Jul 2009
Location: CT
Posts: 1,912
Rep Power: 0
SECTLANDSCAPING is on a distinguished road
Default

Quote:
Originally Posted by Steve View Post
No matter when you buy it, such expenses are still tax deductible right?

The thing I get concerned with is newer business owners tend to take this and run with it and at the end of the year spend everything on stuff they may or may not need.

Ultimately buying parts and writing that expense off as a tax deductible expense really means you are still taking money out of your pocket to purchase the things.

Where something that you can write off as tax deductible is still costing you 70 cents on the dollar isn't it? Depending what your tax bracket is?

It's not like it is free right? If you didn't buy that say $100 part, you would still retain $70 or so after you paid taxes on that $100. So doesn't the question of whether you should buy something like that or not come down to, would you rather have that $70 per $100 in your pocket or would you rather spend it on a part and have a 30% or so discount because you are buying it with non-taxed money?
This is why I said spend what you can. If you were thinking of adding a new push mower go for it. I wouldnt go get a ztr so I didnt have to pay taxes. It would be very unwise to just blow money not to pay the tax man.

Yeah you could deduct it the following year. Thats why its a preference. Spend now when you have a surplus of cash or spend in the spring before money is coming in. The only problem with spending in the spring is your waiting a year to get the tax deduction vs a few months.
Reply With Quote
Reply

Bookmarks

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is On
Forum Jump

Similar Threads
Thread Thread Starter Forum Replies Last Post
"Part Timers", "Low Ballers" & Self Employed doug1980 General Talk 43 01-27-2015 08:01 PM
Starting a Lawn Care Business with "Lawns of Wealth" startlawnbusiness Promote your products or services 0 09-08-2010 03:29 PM
Have you seen "Simply Mowing" door hanger/flyer template? akg62 Starting a lawn care business. 1 04-17-2009 02:02 PM
NEEDED: 1 landscaping company to profile LocalAdLink's "Geo-targeting" advertising Green_Day Promote your products or services 10 04-08-2009 09:48 PM

» Recent Threads
  RatingTitle, Username, & Date Last Post Replies Views
Z246 Deck change question
JohnsLawnCare
Today 01:47 PM
Today 06:38 PM
by Steve
1 14
DIY Sprayer
acrajchel
Today 09:13 AM
Today 06:36 PM
by Steve
1 17
Hello Everyone
JohnsLawnCare
06-22-2016 11:14 AM
Today 06:20 PM
by Steve
15 531
How much to charge for...
jymie
03-31-2013 05:59 PM
Today 06:18 PM
by Steve
23 5,926
Hi from Long Island NY
Lori22
07-18-2016 02:01 PM
Today 06:11 PM
by Steve
10 179
Hi everyone!
greenwavemedia
Today 03:22 PM
Today 03:22 PM
by greenwavemedia
0 12
New Site Hows it look
Infinitelawn
03-16-2015 10:32 AM
Today 03:06 PM
by greenwavemedia
5 10,363
Needing a website built
burtle
06-17-2015 09:02 AM
Today 02:58 PM
by greenwavemedia
15 18,299
Looking for new host
Just for Cuts
11-26-2015 06:58 AM
Today 02:49 PM
by greenwavemedia
9 1,463
New Business Owner
danesdanglas87
07-20-2016 12:31 PM
07-21-2016 05:04 PM
by Steve
2 98
Hi! I'm Tony from Tampa
Lawnline
07-12-2016 06:47 PM
07-19-2016 04:45 PM
by Steve
5 616
Question about...
Bradcook21
07-18-2016 05:22 PM
07-19-2016 04:38 PM
by Steve
2 112
Hello from Watertown New...
lawnmanrick81
07-19-2016 03:57 PM
07-19-2016 04:11 PM
by Steve
1 63
Gutter Cleaning Tool
DanielThomas
07-18-2016 08:23 AM
07-18-2016 04:36 PM
by Steve
1 92
Starting on a lawn care...
Coco3465
07-16-2016 11:26 AM
07-17-2016 09:20 AM
by Steve
1 118
Aspiring Company Owner
TJ136
07-12-2016 05:12 AM
07-15-2016 02:52 PM
by SC93
6 218
Hi Everyone
JavelinaLawn
07-10-2016 07:29 PM
07-13-2016 02:01 PM
by Chilehead
5 751
Review of our lawn care...
Lawnline
07-12-2016 06:40 PM
07-12-2016 06:40 PM
by Lawnline
0 391
Custom Canopies
JohnsLawnCare
07-12-2016 08:38 AM
07-12-2016 04:14 PM
by Steve
1 265
Spot checked by...
Just for Cuts
06-28-2016 02:34 PM
07-11-2016 03:53 PM
by Steve
4 286
John Deere JS40 issues
Mr. Mow
07-06-2016 01:28 PM
07-11-2016 03:52 PM
by Steve
3 210
Start My Own Business?
mowandblow1980
01-12-2016 07:43 PM
07-11-2016 11:18 AM
by DanielThomas
15 1,759
Rubber mulch...
avetslawncare
06-24-2015 09:28 PM
07-11-2016 09:11 AM
by Chilehead
9 3,295
Firefighter gone Lawn...
Firehouselawn@hotmail.com
03-10-2016 04:50 PM
07-07-2016 05:07 PM
by Steve
11 10,536
I need some business...
Firehouselawn@hotmail.com
07-06-2016 05:42 AM
07-07-2016 05:00 PM
by Steve
4 253
Business Overload
Chilehead
05-06-2016 09:27 PM
07-07-2016 04:53 PM
by Steve
24 1,260
Chemical Applications
acrajchel
06-24-2016 06:44 PM
07-05-2016 12:38 PM
by Chilehead
6 369
Is it too late?
Cpadgett
05-28-2016 09:10 AM
07-05-2016 11:54 AM
by Steve
14 872
3 Applications or 5...
stansg1fresh
02-18-2013 12:02 PM
07-04-2016 09:19 AM
by LawnPerfection
9 1,702
Best Push Mower You Have...
markty
05-14-2016 03:46 PM
07-02-2016 03:41 AM
by markty
27 1,928
Great Arborist Ladder
SGL1
06-04-2016 09:56 AM
06-28-2016 08:04 PM
by mowandblow1980
11 690
Newbie
Jhoell
06-25-2016 03:28 AM
06-28-2016 02:11 PM
by Chilehead
2 265
Say Hello !!!
Steve
03-19-2007 11:18 AM
06-28-2016 11:02 AM
by Brownieboy
1,253 440,277
Powered by vBadvanced CMPS v3.1.0

All times are GMT -5. The time now is 06:50 PM.


(C) 2011 Riggs Publications - Terms of use & Privacy Policy

All times are GMT -5. The time now is 06:50 PM.

(C) 2011 Riggs Publications - Terms of use & Privacy Policy