January 17, 2008

Personal Service Businesses
New Income Adjustments

Implementation of new changes in the Income Tax Act has increased the integration of income eligibility for small business deduction (SBD) paid out through dividends that previously did not qualify under the old guidelines. During 2008 - 2011 additional changes in the reduction of federal corporate tax rate may increase tax savings when corporation earns personal services business (PSB) income and pays out its after-tax earnings as eligible dividends.

In some cases it may make sense to convert employment income to PSB income as it is less punitive under the new changes. There may be a substantial deferral of tax at very little absolute tax cost when PSB income is earned by a corporation and later paid out as an eligible dividend to a shareholder paying tax at the top personal rate.

Family members with little or no income that are shareholders are eligible for additional savings under these new changes: the tax-free eligible dividend amount is approximately $55,000 for 2007 and will increase further when the increases to the basic tax credit take effect in 2008 and 2009.

Reduce Trips to the Post Office

Pitney Bowes - Mailstation K700

As an IPBC Member, save nearly $120 a year on a reduced monthly rate with a one year rental agreement for the Pitney Bowes Mailstation K700. This includes the 500 gram scale and resets. The precision of electronic weighing can save up to 20% on postage!

Additional Special Features...

• Internal rating feature with integrated scale calculates the correct postage - never overpay again
• Avoid time consuming trips to the post office-meter mail, from your office, 24 hours a day
• Available accounting feature enables tracking of postage usage by department
• Less desk space required-integrated scale sits on top of meter, reducing office clutter
• Prints postage for all envelope and package sizes

Learn more here

Quickbooks 2008 - Key Changes Teleconference

Special Teleconference with Michael di Lauro
Thursday, January 24, 2008
At 10:00AM - 11:30AM PST

Just released in December, QuickBooks 2008 represents the most dramatic change in at least five years.

With the 2008 version of QuickBooks, Intuit has introduced a number of improvements to the interface, the capabilities and the feature-set of its flagship product. Add in the significant changes in feature sets (multicurrency & sales orders, to name just two) and in functionality and you'll quickly see that this new version will have a huge impact on how you and your clients.

Join us for a 90 minute teleconference where you'll learn about these new changes and where you'll have the opportunity to get answers to all your QuickBooks related questions.

To learn more or register click here

Tip of the Week

Keep Good Records

Many business owners don't keep good records. Some don't understand bookkeeping; others understand it, but may be afraid of what the numbers might tell them. Bookkeeping is the glue that keeps your client's business together. If their records aren't in good shape, the business could fall apart. A healthy business is monitored through its records on a regular basis so problems can be found and corrected before it's too late. Remember - it is a Canada Revenue Agency requirement - Businesses must keep books and records of all transactions that relate to their income and expense claims.