What taxes do you have to pay when you’re self-employed?
I’m planning to open up a nail salon and before I start my business plan, I don’t really get what taxes you have to pay and such. I have read books from the library about personal finance which have a chapter on financing when it comes to business, but I still quite don’t understand the business language. Where can I get help? To whom should I get help from when it comes to financing or with all this tax situation?
It would help to know what province you are in, because they all have different rates. It would also help to know whether you plan to set up a company (which is a separate taxpayer), or run it as a sole proprietership (or partnership) which is not (as you claim the income on your own return).
However, if this was my business plan, I would plan for 15% income tax (on net income, ie, after expenses).
But the best advice is not to worry too much about income tax. Tax is payable only on your profits. So concentrate on making a profit. That’s the most important part. Avoiding losses is far more important than worrying about income tax.
It would help to know what province you are in, because they all have different rates. It would also help to know whether you plan to set up a company (which is a separate taxpayer), or run it as a sole proprietership (or partnership) which is not (as you claim the income on your own return).
However, if this was my business plan, I would plan for 15% income tax (on net income, ie, after expenses).
But the best advice is not to worry too much about income tax. Tax is payable only on your profits. So concentrate on making a profit. That’s the most important part. Avoiding losses is far more important than worrying about income tax.
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