| April 2011 | PADGETT BUSINESS SERVICES® | Vol. 9, No. 4 |
2011 Minimum Wage ChangesSeveral Provinces have increased or will increase their minimum wage rates in 2011. The list be- low details the wage rate changes taking effect in 2011.
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Payroll Solutions at Your Fingertips!Many of our clients have decided to make their lives less stressful by outsourcing one of their most aggravating administrative chores - payroll preparation. PayTrak Payroll Services offers small business clients: Personalized Service – each client is assigned a dedicated customer service representative Flexibility – PayTrak has a number of options on how your payroll information is both received & delivered Direct Deposit or Cheque – employees can be paid by cheque or their pay can be deposited directly into their bank accounts Concise Reports – eliminate unnecessary paperwork TaxTrak – PayTrak electronically files payroll remittances on your behalf For more information on outsourcing your payroll, visit www.paytrak.ca Payroll Assistance Online! We have a number of features on our website that help you stay abreast of payroll related issues. Our News section contains information on minimum wage changes, statutory holiday regulations, CRA & provincial updates and other items that impact payroll. In our Resource Centre, we have downloadable forms and worksheets, links to important resources and FAQ’s. Contact us today to find out more about simplifying your payroll.877-316-2999www.paytrak.ca |
CLAIMING AUTOMOBILE EXPENSES
One of the more common expenses claimed by taxpayers are automobile expenses (applies to any motor vehicle such as a van, bus, pickup truck, station wagon, SUV, or other truck). Many individuals use their automobile for work or business and incur personal expenses in doing so. It is important to note that only expenses of a business nature are eligible as a deduction against their related income. As such, the Canada Revenue Agency (CRA) has strict requirements in ensuring that only business-related expenses are claimed. As a result, the retention of automobile tax records becomes imperative for every taxpayer that uses an automobile for work or business.
Maintaining Automobile ExpensesThe use of an automobile log provides one of the safest ways to substantiate and keep track of all your automobile expenses incurred that are deductible for income tax purposes and the kilometres driven on income-earning activities. The type of expenses to keep track of can be broken down into two categories. They are operating and fixed expenses. |
Operating ExpensesThe types of operating expenses related to an automobile include gasoline, maintenance and repairs (such as oil changes and car washes), insurance, license and registration fees. Such expenses may vary in relation to the amount of kilometres driven. |
Fixed Expenses Fixed expenses differ from operating expenses in that they relate to the automobile itself as opposed to the amount of kilometres driven. When an automobile is purchased, they would relate to the capital cost allowance and interest expense when financed. In the case of a leased automobile, such expenses would include the lease payments. It is important to note that there are special rules and restrictions which limit the portion of actual costs that can be included in your total expenses. You can consult with your Padgett Business Services representative to obtain more information on what these special rules and limitations are. |
Deductible Expenses Because your automobile will most likely be utilized for both business and personal reasons, it is essential that the total automobile expenses be allocated between these two uses on a reasonable basis in order to arrive at only the deductible portion for income tax purposes. The best method to achieve this will involve the distance traveled calculated by taking total kilometres driven for business purposes divided by total kilometres driven for both business and personal purposes. Certain expenses such as parking expenses incurred while on a business trip and car repairs made as a result of an accident while on a business trip do not have to be prorated. However, such expenses incurred resulting from a personal trip made are not deductible. |
Padgett Business Services is dedicated to meeting the tax, government compliance, profit & financial reporting and payroll needs of businesses with fewer than 20 employees in the retail and service sector of the economy. This publication suggests general business planning concepts that may be appropriate in certain situations. It is designed to provide complete and accurate information to the reader. However, because of the complexities of the tax law and the necessity of determining whether the material discussed herein is appropriate to your business, it is important you seek advice from your Padgett office before implementing any of the concepts suggested in this newsletter.