One of these is whether or not to incorporate.  It is a complex issue, and unless you have done your homework and know exactly what benefits you will achieve by incorporating, and what the increased costs will be, you might want to wait until you have talked to an experienced accountant.  It’s possible to incorporate without paying for professional advice but beware:  if you believe you don’t need to talk to an accountant, you might be making a costly mistake.

For example, if lowering your taxes is your main goal in choosing to incorporate, you won’t be able to take advantage of that until your business makes more money than you need to pull out of it as wages.

You might expect to incur losses in the first years of operation.  As a proprietor those losses are deductible from other income, which can help with cash flow at a critical time.  However, an incorporated business is a separate legal entity and its losses cannot be applied to personal income.

Do your homework on this one, especially if the business is not certain to be making a profit after paying your own salary.

Look for this link on Bookkeeping Essentials entitled “When to Incorporate” that matches well with my own experience:

http://www.bookkeeping-essentials.com/ccpc.html#incorp

Here’s a link from Industry Canada on Why Should I Incorporate?
http://www.ic.gc.ca/eic/site/cd-dgc.nsf/eng/cs04841.html

Cheers! – Dianne

You’ve decided to take the plunge and start your own business.  You have a great product or service that you know will provide value to the community, and you have some ideas on marketing that product.  The next question is, how do you set up your own accounting?

Start like you mean it! - a basic accounting course

As time permits, I’ll be posting a few small articles on this topic.  My goal is to use this as a springboard to putting together a basic bookkeeping course.  Stay tuned!

Dianne Goodacre
The Balance Sheet

www.balancesheetbookkeeper.com

Based in the Comox Valley, Dianne has clients from Bowser to Campbell River. She feels that a bookkeeper needs to be where the action is in order to provide the best value. Find out where your business is at!

Please note: this is a test to see if I can upload an image. — Dianne

Dianne Goodacre, Proprietor, The Balance sheet

THE BALANCE SHEET

STREAMLINED BOOKKEEPING SOLUTIONS

Dianne Goodacre
T: 250 331-0131
C: 250 650-SAVE(7283)
E: dianne@balancesheetbookkeeper.com
W: www.balancesheetbookkeeper.com

Honoured as the Comox Valley Home-Based Business Association’s 2011 New Business of the Year!

Dianne Goodacre provides reliable bookkeeping services to small businesses in the Comox Valley. She promotes streamlined office procedures and is happy to set up, clean up, or train staff in many applications. She is proud to be the Treasurer of the CVHBBA for 2011/12 and believes small business is the backbone of the community. She enjoys helping business owners visualize their long-term profitability with a cash flow projection, as part of their business plan. To contact Dianne Goodacre: email dianne@balancesheetbookkeeper.com; phone 250-650-7283; www.balancesheetbookkeeper.com