Category: Finance

Thinking of starting your own business?

Many people want to work for themselves rather than an employer, and for many different reasons.  Maybe you have a passion or skill you want to share with the world.  Maybe you want the flexibility and control of being your own boss.  Maybe you see a unique niche that you can fill.  Whatever the reason, creating your own business can provide great opportunities to build the career and lifestyle you want.

Canada has a long and rich history of entrepreneurship, which isn’t to say that being an entrepreneur is easy or the right path for everyone.  Luckily, there are lots of supports available for young adults looking to start their own business.

Futurpreneur.ca is one of these support organizations.  They have been helping young adults become entrepreneurs for more than 25 years and have supported more than 12,000 businesses across the country.  The organization is a non-profit that operates across Canada and provides a range of supports, including mentoring, early-stage financing, and other business support to young adults between the ages of 18 and 39.  Their mission is particularly focused on supporting diverse entrepreneurs and businesses, including those run by and serving members of Canada’s BIPOC and LGBTQ+ communities.

Financial Support

Young business owners can secure funding in the form of collateral-free loans directly through Futurpreneur, up to $20,000 from the organization itself, as well as up to $40,000 from the Business Development Bank of Canada (BDC).  These loans are repayable over structured plans and can include benefits such as competitive interest rates and interest-only payments for the first year.

As with any loan, young entrepreneurs will need to provide information, including a detailed business plan and financial resources, in order to determine their eligibility and the amounts they might be eligible for.

Mentorship

While financial support is necessary, having a mentor to help you along can make the difference between getting by and excelling.  Futurpreneur provides new business owners with up to two years of mentoring through its network of 2,400 volunteer mentors with experience in a wide range of businesses.  Futurpreneur matches young entrepreneurs with mentors who can offer the best knowledge and support for their particular business focus.  Mentors will encourage and offer advice, help you network and build a community, and help you handle the common problems that can crop up when launching and running a new business.

The organization also offers specifically tailored mentoring programs geared towards Black and Indigenous entrepreneurs, as well as those for whom their business venture is a “side hustle” outside their regular employment.

Other Entrepreneur Resources

Aside from the core offerings of financial support and mentorship, Futurpreneur also offers a variety of additional business supports and tools.  These include regular workshop series that focus on business development topics such as creating business plans or managing finances and cash flow.

There is also an annual growth accelerator workshop program for eligible business owners, which focuses on business growth, profitability, marketing, intellectual property, and many other topics.  This program is offered virtually through a series of workshops hosted by subject matter experts and allows entrepreneurs to learn from established business owners, as well as develop relationships with their peers.

If you’re thinking of starting your own business, or if you already have a business plan in hand, Futurpreneur.ca might be a great way to get your business off the ground.

Sources

Futurpreneur. https://www.futurpreneur.ca/en/about/

There’s a popular saying that goes, “Everyone procrastinates, but not everyone is a procrastinator.” It’s a given that we’re all probably guilty of putting things off to the last minute, like buying a gift for a friend’s birthday party or calling a restaurant to make a reservation an hour before the party. Both of these things have a workaround to them, and there are alternatives. However, it’s a different scenario when you put off something that could lead you to paying a penalty – like when you file your taxes late.

Filing taxes at the last minute is an all-too-common scenario, but fortunately, there are ways to successfully file your taxes on time even at the last minute. Read on for our suggestions below.

1. Gather all your receipts.

For time efficiency, gather all your receipts before you start working on your taxes. This way, you won’t need to go back and forth looking for paperwork for an expense you need to claim. Ideally, you should have all receipts in one place, whether in a file folder or a Manila envelope. If this wasn’t possible and you’re missing a few receipts here and there, retrace your steps to find out where you might have kept them.

2. Utilize online banking options.

It doesn’t matter whether you’ll have to pay or you’ll receive a refund, it’s always best to set up an online banking account that links to your Canada Revenue Agency (CRA) account. If you’re expecting a refund, sign up for the direct deposit so your refund can be directly deposited in your account. If you’re owing taxes, simply add CRA as the payee – the account number will be your Social Insurance Number (SIN) – and from there, you can easily settle what you owe.

3. Have a professional do your taxes.

If you’re struggling to do your taxes and cannot seem to figure out how to claim expenses and do write-offs, it’s best to have a professional do your taxes on your behalf. Remember, your tax forms are a legal document, and if you’re mainly doing guesswork because you’re running out of time, it will have dire consequences. An error in reporting your expenses can result in a fine or a visit from an auditor for reassessment. Keep in mind that it’s important to report everything accurately, and so seeking the help of a professional tax preparer can go a long way. Some charge a fee as much as $60, but if you don’t want to shell out cash, you can go to a volunteer tax clinic instead.

4. Make payment arrangements.

If you’re anticipating that you’ll owe taxes and you don’t have the means to pay at this time, remember that it’s better to file on time than put it off just because you’re unable to pay. There are payment arrangement options available, as the CRA recognizes that people have different abilities to pay especially under the circumstances because of the pandemic. Exploring these flexible options beforehand can relieve you of the anxiety of paying upfront.

Filing taxes early on is the ideal scenario so you can avoid last-minute filing which can result in errors and penalties. However, if you’re quickly running out of time, it’s still possible to get your taxes done by following the recommendations above.

Sources

Government of Canada. “Last-minute tax-filing tips.” https://www.canada.ca/en/revenue-agency/news/newsroom/tax-tips/tax-tips-2021/last-minute-tax-filing-tips.html

Not everyone wants to work for someone else, whether that would be for a big business or a small one.  Instead, many people prefer to work for themselves as entrepreneurs and start their own business.  Maybe they want to bring their own great ideas into the world themselves, or maybe they simply want to be their own boss.  Whatever the reason, for motivated, determined, and creative people, working for themselves can build a more enjoyable career than they would experience elsewhere.

There is more than one way to create your own business in Canada, but a common one for individuals and a good place to start is a type of business called a sole proprietorship.

What is a Sole Proprietorship?

The Business Development Bank of Canada (BDC) defines sole proprietorship as “a business with a single owner who is solely responsible for all liabilities. In the eyes of legal and tax authorities, the business and the operator are one and the same.”

A sole proprietorship business is a less formal business structure compared to other small businesses, such as partnerships or incorporated companies.  Setting yourself up as a sole proprietor has a low barrier to entry, is affordable, and is relatively simple to set up, which makes this type of business an attractive path for new entrepreneurs.  You don’t need to register a sole proprietorship with your province unless you are earning revenues greater than $30,000 per year, or wish to operate under a business name other than your own legal name.  If you do want to name your business something unique, then you need to register your business name with the government.

If you begin earning over $30,000 annually, then you will likely need to register for a business number, and be required to charge and pay sales taxes.  You will also need a business number if you want to hire other employees, or access government programs that assist small businesses.

Almost any business can be a sole proprietorship, but they are commonly used by freelancers of all types, tradespeople such as electricians or carpenters, artists such as photographers or designers, and many other types of work.

Considering whether a sole proprietorship is right for you?  Here are some pros and cons:

Pros

• A sole proprietorship is easy to create, and easy to dissolve, which is useful for new businesses and young entrepreneurs just starting out. Start-up costs for establishing the business are low.
• The owner has complete control of business decisions, direction, etc. This means you can do things exactly the way you want, without having to convince a partner or anyone else.
• Operating your own business means you have the flexibility to work when and where you want, which can be especially useful for a part-time or side-gig to a regular job, or if you have personal and family obligations you need to accommodate.
• A sole proprietor owns all the earnings and profits of the business; effectively, the revenue from the business is your income.
• Accounting and taxes are relatively simple, and easy to manage using basic commercially available software.

Cons

• As a sole proprietor, the business and the owner are considered to be the same entity for taxes and legal purposes. This means you are responsible for all liabilities, legal and financial, when it comes to the business.  This includes debts or other obligations that the business owes to other people—so if your business owes money, you owe money.
• If you are not able to work, the business can’t operate and therefore will not create income. Though you have some flexibility in when you work, this means you might need to work long hours each day, or many days without a proper break, in order to get everything done that needs doing.
• Because in a sole proprietorship the owner and business are the same, you may need to use personal savings and loans to pay for start-up costs and other business expenses until the business is turning enough profit to cover those costs.
• It can be harder to grow the business and find employees, though this will vary depending on the type of work and the location where your business operates.

Do Your Research

As with any other life decision, do your research!  There are lots of resources available from your local business development organizations, municipal or provincial government, and industry groups related to your business’s focus.  Be sure to talk to other sole proprietor businesspeople.  They can help you understand what is involved in creating your own business as a sole proprietor, both for day-to-day concerns as well as the big picture of how to operate and grow your business.

You will have to be prepared to work hard, but the return on investing in yourself and your own business is an amazing career doing something you’re passionate about!

Sources:

BDC. “Sole proprietorship.” https://www.bdc.ca/en/articles-tools/entrepreneur-toolkit/templates-business-guides/glossary/sole-proprietorship