Whether you should lease or buy a car depends mainly on cash flow and the interest rates. If interest rate on the lease is high, then financing is better. If monthly loan installments are too high, then leasing would be better. Leases also have 2 types – capital leases and operating leases. The difference between the two leases is that in an operating lease, there is an option for the lessee to buy the car at the end of the term of the lease. In a capital lease, the lessee must purchase the car or pay an option price as low as the final monthly lease payment. Therefore, capital leases are like financing your own car and should be treated as such.

If you use your car for business, certain amounts of your lease payments can be deducted for business. If you own the car, then certain amounts of the loan interests and depreciation of your car can be deducted. Your accountant will be able to calculate reasonable amounts to deduct at tax filing time. And so you may also wonder, would it be better to finance the purchase of the car or purchase it with cash? If your cash after tax is earning lower than that charged by the lender or the bank, then you probably should purchase with cash. Or course, this also depends on your cash flow.

Therefore, you will need to consider the following factors which affect a car lease in order for you to decide on whether you would prefer to lease or buy a car:

Acton Accounting and Bookkeeping Inc. starts a new bookkeeping special: save 50% on the first month with us! This special offer is valid for a limited time so hurry up signing up with us.

There are lots of benefits outsourcing your accounting and bookkeeping. Just like you can read on the flyer above, you realize costs saving thanks to the flexibility offered by outsourcing your bookkeeping work only when you need it.

Also, the accounting fee is variable, depending on the level of your business activity. Moreover, this is a cheaper way than hiring a permanent accountant or bookkeeper.

Our professional expertise in accounting and in particular tax planning will provide you new opportunities  as income can be projected prior to fiscal year end. Cash flow management ensures that the company will meet its financial obligations; or if there is a cash flow issue, the business owner is aware of it before the consequences are felt.

Your government remittances will always be made on time and accounting records are in order ensuring compliance with government regulations: you don’t have time to keep yourself updated? We do.

We will help increase your profitability as well, thanks to timely financial reports and analysis. And, finally, you won’t have to invest in new equipments and administrative features (computers software, desks, office space and personnel).

So if you are a stressed business owner who don’t want to deal with the bookkeeping part of your company, but want professional accounting services to be done on a regular basis, Acton Accounting and Bookkeeping Inc. is the company you need. Again, you will have 50% off the first month if you are a first time client and if you sign up with us for at least 3 months. Don’t wait any longer and call us at 604.737.8800 or contact us by email.

Taxable or Non-Taxable? People don’t really know what’s exactly going on with the Harmonized Sales Tax. Here is a table to see what is taxable.

Source: “Harmonized Sales Tax in Canada British Columbia Edition” prepared by BC’s CGAs.

Please read it carefully. If you still have second thoughts regarding HST, please contact Acton Accounting and Bookkeeping.

The Recession has had many detrimental effects on British Columbians for the last few years  and with the introduction of the HST many fear that the recession is more apparent than ever. Jim Sinclair President of the BC Federation of Labour states, “It’s the wrong tax, wrong time and for the wrong reasons.” He believes that “tax cuts haven’t worked in the past, leaving us with a legacy of closed schools, unfunded health care facilities and growing Unemployment.”  About a month ago, an Anti-HST petition has also been created which is causing a lot of controversy between BC residents and indeed the Government, moreover since opponents reached 10% of registered voters in 56 ridings out of 85 already.

On the other side, a report in The Vancouver Sun has illustrated that “Recession is now history in BC” according to an increase of good business news.  KPMG announced that “the host of the 2010 Winter games now offers the best business tax climate of 41 countries measured around the world.”

According to various surveys and reports there is evidence of an increase in business and a slight improvement in the economy however, this is insignificant news to the majority of households across BC who are finding it difficult to make ends meet.

CAD vs. US: Overview

Just one year ago, the Canadian Dollar was at its lowest exchange rate with US dollar since July 2005. This month, the Loonie reached the par and is expected to stay there within the next little while.

From January to March 2010, a dollar CAD was blocked at around 0.95 US dollar, when strong economic data and expectations for higher domestic interest rates were supporting the Loonie. CAD rose to parity for the first time since July 2008 earlier this month, on April 6th, and finally closed above parity about a week later on April 14th.

Why is the Canadian currency raising such a wave of popularity?

Like I said above, Canadian economic data are stronger then expected. In fact, Canada is now seen as the leader of economic grows this year (over other G7 countries). Such good results allow us to believe in expecting an early raise of the general interest rates by the Bank of Canada, while United States is still trying to recover from the economic downturn.

How will it affect Canadian investors’ behavior?

With a strongest national currency, the purchasing power of Canadians increases, making the foreign products relatively less expensive in CAD. Also, Canadians will have lots of opportunities on the foreign markets, in particular in real estate. Canadian companies can invest abroad, by means of taking stakes in foreign companies.

As of April 24^th the CAD/USD exchange rate was below par, but the expected trend is in favor of the Loonie beginning next week.

Anti-HST

On April 6^th a massive campaign to take down the Harmonized Sales Tax  (HST) in British Colombia  was headed by former premier Bill Vander Zalm called “Fight HST” . This campaign exists to fight against Premier Gordon Campbell in order to impose a public referendum on the HST. If Vander Zalm and his army of volunteers thrive, this movement will enter in history as the citizen’s first successful initiative to force BC to hold a referendum.

We all know this won’t be easy: the volunteers have to collect 10% of registered voters in each of the 85 provincial ridings for the petition within the next 90 days. In other words, they need 300,000 signatures to push back the tax reform.

What exactly is wrong with HST?

It is obvious that the reform will have a significant impact on consumers who will pay much more taxes on products and services (which are usually free from PST).

For the same reason, HST will hurt small businesses. Businesses who, in the future, sell services outside the province within Canada will become tax collectors for the consumers’ region. This can either boost the national economy or slow it down; Business relationships between 2 provinces will have to be well-balanced if we don’t want the provinces to depend upon each other and if we want to boost Canada’s economy.

Pro-HST

The original plan was to harmonize taxes in order to attract more investments within Canada and to be able to create a significant number of jobs in the country.

According to the BC government, there are some benefits for customers:

-  Some products will stay exempt from PST, such as gasoline, children clothing, books, diapers, and other products which are currently exempt from GST will stay out the reform.

- New home buyers purchasing a house worth more than $525,000 will receive a rebate estimated at $26,000. However, the purchase of used homes will be HST exempt.

- Families with an income of less than $25,000 will receive a special HST credit.

- HST is not supposed   to improve consumers’ costs for electricity or natural gas.

Rural industries will realize that it is important to save. This allows them to invest back in local job opportunities and encourage investments in BC.

Finally, if you are a Canadian taxpayer you will be saving money thanks to the HST, because of the reduced administrative costs incurred by the PST.

Overall, we’re not here to tell you what you need to think about HST. You already know from daily newspapers that the HST is a major concern these days. If you don’t know what to think yet, you can check out the opposing sides’ websites http://fighthst.com/ and http://www.gov.bc.ca/hst/.

In my opinion, the HST is more a question of politics rather than economics.

HST by Aranda Adams

Hi everyone,

Here is further information about the event for business owners I told you about last week. Sorry for the late update by the way. The event will take place in Vancouver tomorrow at 6.30pm.

Dear Business Owners:

I would like to welcome you all to the free business seminar for business owners I am hosting with CIBC branch manager, Paul Cheng, CIBC Mortgage Specialist Noel Diguangco, and Marketing expert, Rob Ciccone for this coming Thursday, March 25, at 6:30 pm, at the CIBC branch on West Broadway. Please see details below.

Free event in Vancouver for Business Owners

I will be providing an informational session on the new BC HST to be implemented in just a few months – July 1st. This seminar’s purpose is to provide an opportunity for business owners to gain useful and valuable information from professionals who can help their business.

Seats are limited so please RSVP

See you there!

Ali

Good morning everyone!

As you know, March is a pretty busy month for accountants . But I just wanted to let you know about an upcoming event for business owners.

I will most likely be co-hosting a business seminar on March 25 with CIBC branch manager, Paul Cheng; CIBC Mortgage Lending Expert, Noel Diguangco; and Rob Ciccone of Success Unlimited.

I will be talking about 2009 Tax Tips and the 2010 HST, CIBC will be introducing their no-fee business account and the CMHC Self-Employed Simplified program for owners to qualify for a mortgage, and Rob will talk about “Marketing for Growth and Profit.” Owner’s would learn how to adjust or improve what they are currently doing to market their business, how to create a solid marketing foundation and ways to grow their business with minimal impact on costs.

Update about time and location coming soon!

Thanks,

Ali

There is nothing really surprising in the announcement of the budget 2010; the government believes that spending restrictions while an economics growth should erase the deficit by 2015. Finance Minister expects the deficit to be reduced by 50% by 2012…But the actual deficit of $53.8 billion and the government will “only” save $17 billion over 5 years.

Knowing that, you can easily guess that leaders are counting on a great economic recovery with a slow interest rates increase; any unexpected drop in GDP or fast interest rates increase would dig the general deficit by billion of dollars.

But still, the impact on most people appears to be very little. For further information, follow that link ‘CBC-Budget-Highlights’or contact us directly here.

Hello readers!

Remember: the RRSP deadline for tax year 2009 is coming soon! On march 1st 2010, it will be too late to contribute to your RRSP, even if you’re still under the contribution limit of $21.000.

But what about the tax refund on your contributions? Well, you can calculate it yourself doing the maths! Your marginal tax rate times your total contribution for the year, and that’s it!

If you don’t have any clue at all, feel free to contact us.

Better late than never…