Canopy Bookkeeping Blog

Employee experience is a big part of a happy workforce and therefore a productive workforce. And technology plays a big part of that experience.

Most workplaces in Canada are constantly evolving in the way they work. We’ve come a long way from rubber stamps and A4 forms. And for the most part, businesses are now turning into a paperless and computer-based operation.

In particular, HR, dealing with large amounts of employee data, needs the right software to not only manage the data, but to ensure workers do not get frustrated along the way.

The interface

When you choose an HR portal for employees to interact with, there are a few considerations that are useful to bear in mind.

A. Will it increase engagement

Your employees will engage with technology that is easy to use, quick and effective. Employees will need to use an employee-engagement/self-service portal to check work schedules, send holiday requests, or check HR policies. If those things are quick and easy to do, it will increase the chance of it being a go-to for anything HR related. This will step up communication and certainly motivation. Also consider branding the portal so it becomes a familiar place for employees.

B. Step up communication

Making your employee self-service portal double as a mail blast tool is also a good idea. It means that important communiques and notices can be sent out easily. It can also be another place to post jobs internally and increase visibility for internal recruitment purposes. Keeping your workforce informed in this way will encourage collaboration and make them feel valued.

C. Streamline workflows

Whether you decide to take an off the shelf programme or bespoke one, you should take time to tailor the software to make it as streamlined a possible. Get rid of unnecessary steps and improve the productivity by creating time-saving workflows. This all creates more time for employees to spend on their core job objectives, something they’ll appreciate you for.

Creating the model

Building the perfect HR self-service portal, like everything, should start with the end vision. Picture what a great experience for your employees would look like. Then think about who the users will be and how different types of users will interact with it and each other. Ultimately, think about what they need from the tool and what you, as HR/senior management, need from the tool.

Create different profiles for each employee group so that you are building the right experience for each one. Then determine how each group will interact with different HR functions: Payroll, Time & Attendance, Recruitment etc.

You can then slowly build a user experience that will improve engagement and productivity within your organisation.

More than an experience

A good self-service portal is more than just creating a user-friendly experience for your employees. It is an effective accountability safeguard.

Particularly from a payroll perspective. Payroll functions must execute accurate and timely payments to employees so providing it a layer of responsibility and transparency makes it more accountable, which is important for your organisation.

In short, a well-executed roll out of a fit-for-purpose HR and payroll self-service portal will be time-saving, increase productivity, with greater transparency. This will benefit both employees and managers and the organization wins either way.

Working from home – how to get a rebate for expenses

Working from home downside: no paid annual, sick days and you do your own tax. Working from home upside: be your own boss, command your own creativity and do your own taxes.

Doing your taxes both a downside and an upside? Sure, because while it may seem over-complex and quite frankly a bit of a drag, there are some perks to being self-employed - working from the comfort of your own home and it getting a big tax rebate .

Work at home expenses

The key thing for those working at home is that they’re responsible for their own expenses.

A work at home business such as a blog or freelance designer etc. means you are the sole proprietor assuming you haven’t incorporated.

If you have another job at the same time, then all of this income is combined and taxed at the marginal rate. You’ll need form T2125- Statement of Business or Professional Activities here.

Running into the negative

When you start out, you may not be as profitable as you expect to be. Sometimes you will run into the negative. For instance, if you’re running a website, then it may take time for traffic to convert into meaningful ad revenue, but increasing hits mean that you know it’s going somewhere.

You can also still claim any expenses made. For instance, if you bought a computer for the purpose of running your business, then you can claim this as a Capital Cost.

This of course is a little precarious to do every year, so let’s hope if you are running a website let’s hope you start making money in the second year.

There are other expenses that you can claim as expenses as well, if they are specific to the running of your business.

What can I deduct?

Capital costs - As well as your computer you can claim other hardware and equipment.

Software - Using the same website example for instance., you can claim images if you spent money on an image, a domain name and domain hosting.

Depreciable property - If you have a desk, printer or camera, claim the cost of these and keep all receipts. These are known as depreciable property and because they are used over time they can be deducted over a number of tax years.

Home costs – Don’t feel cheeky claiming broadband either if you work from home. You’ll just have to work out how much of it you used for personal use and how much for business and only claim the business element. The same can be said of property taxes, mortgage interest rates and any insurances. Just calculate the number of hours spent on any of the rooms for the business. Divide that by 24 and multiplying it by your business expenses. The result is your deduction. And of course, adjust it pro rata if it’s only used for part of the year.

Advertising/marketing -Any type of expense you incur for promoting your business can also be claimed. Using the website example again, this may include, affiliate programmes, or giveaways andAdSense for instance.

Stationery - anything used for business purposes such as notebooks, pens or other office type equipment can also be claimed.

Legal/accounts support - sometimes if you’re a little further ahead in your business, there may be professional fees to dole out such as for your accountant or lawyer or any procedural costs.

Travel - you may be working from home but occasionally you’ll have to venture out for a meeting, a conference or any type of field work your business might involve. In which case, expense it. According to CRA, deducting all flight and accommodation is fine and meals can be deducted at 50%.

Other utilities - there’s an argument to deducting part of your mobile phone bill as well if you use it for business. Whether you’re making calls, tweeting out or using the internet on the go.

Any business expense

The key take away however, is if you used it for the sake of your business, then keep the receipt or get the record of use and keep it for tax time.

For a comprehensive explanation of how to deduct these expenses and what other types of expenses can be deducted, with which forms, visit the Canadian Revenue Agency website.

Or contact Canopy Bookkeeping to guide you through the tax rigmarole.

Before year-end hits, you need to make time to review how your taxes fare up and to see where you can minimize payments. It’s part of any savvy business and financial plan.

Here are a few quick tips to see where the fat could be easily trimmed.

1) Make the most of your Capital Cost Allowance (CCA) claim

If your business uses equipment, review what equipment you’ve already taken on board and what you are planning to get in. If you have your sights set on some equipment in the near future, it could be worth getting that in now rather than the new financial year, so that you can maximize your CCA claim. And per the ‘half-year rule’ you can claim 50% of those CCA allowed (as technically you won’t be using it until the new tax year.

The full amount on the equipment can also be claimed the next year.

2) Get rid of depreciable assets later

In the same vein of getting in the new equipment as quickly as possible, you’ll also want to delay disposing of any old equipment – or depreciable assets – until the new year. Otherwise you won’t be able to claim the CCA.

3) Delay income to the new financial year

Less income means less tax, so if there is anything that makes sense deferring then do so. This is especially pertinent if there are lower tax rates expected in the following year. Or if perhaps you’ve had a higher income than expected.

4) Increase business expenses

Income can also be managed by increasing your expenses. This may sound counter-intuitive but the idea is to bring forward any expenses you need to spend in the following financial year – products, services or technology. The expenditure is the same but you’ve just saved yourself some tax.

Business expenses are divided into categories, so check if you have underspent in any area. You may want to increase those costs in any case for the benefit of your business e.g. consulting or marketing.

5) Maximize RRSP or TFSA contributions

Registered Retirement Saving Plans or RRSPs are retirement saving plans. These plans are a good tax-saving method if you are, for instance, a sole trader. You may have a retirement plan in mind in any case and you can contribute up to 18 percent of your income to these schemes per year.

If you don’t have retirement plans in your sights, then you can set up a Tax-Free Savings Account or TFSA. While these are not tax deductible the income they earn is tax free and you can contribute up to $5,500 to one each year.

6) Calendar year reserve

This applies to anyone wanting to close their business. If it’s coming to the end of the financial year, it pays to stay afloat until the new tax year begins. That’s so that the remaining part of the year won’t be taxed until the following year.

These are six straight forward and easy tips to help you save before the end of the year and get a head start on the following year’s tax planning.

It’s important to keep track of the new developments coming out of the Canadian Revenue Agency. It will help you to inform your own financial planning.

Here is what’s new and what you need to know.

Small Business Job Credit

If you paid employment insurance premiums in 2015 or 2016, you may be due for a refund. Because in 2017 there’s a new Small Business Job Credit as part of the new tax policy to recognize the important contribution that small businesses make with job creation and growth. Details on applying the refund are on the Finance Canada site .

Accelerated capital cost allowance

If you have acquired machinery between 2015 and 2026, it may be accruing an accelerated capital cost allowance (CCA), which is currently at a rate of 50% on a declining-balance basis. It’s directed mainly for the manufacturing and processing of goods for sale or lease as CCA Class 53. Half the CCA deduction will apply if it was available for use by the tax payer in the previous tax year.

Eligible capital property

The eligible capital property system is being scrapped and in its place, a new CCA class 14.1 will be introduced with transitional rules.

So, capital expenditures used to be added to cumulative eligible capital pool at a 75% inclusion rate, but the rate of depreciation on those eligible expenditures was 7%. The new system will see a 100% inclusion rate for newly-acquired properties – these will be class 14.1 CCAs – and the CCA rate will be 5% on a declining-balance basis.

There may also be additional CCA deductions allowed on property acquired before 2017. And a deduction for incorporation expenses incurred in 2016 is also allowed. The initial $3,000 would be treated as a current expense and wouldn’t be added to the CCA class 14.1.

Expanding tax support for clean energy

Tax support for businesses promoting clean energy will come under class 43.1 and 43.2. These CCAs may be applied for electric vehicle charging stations that meet certain power thresholds. But these proposals may be expanded even further.