Understanding Your Business Obligations

For income tax purposes, a business is defined as an activity with a reasonable expectation of profit supported by evidence. For GST/HST purposes, a business includes any activity, whether or not engaged for profit, that involves supplying property or services on a regular or continuous basis.

Before starting your business, it’s essential to consult professional guidance to ensure proper registration, structure, and compliance with all relevant tax obligations.

Key Steps for New Businesses

1. Business Registration

1. o Obtain a business number from the CRA through Business Registration Online before interacting with other agencies, including the Canada Border Services Agency (CBSA).
2. o Determine the appropriate business structure (sole proprietorship, partnership, or corporation) to optimize tax and liability planning.

2. CRA Program Accounts

1. o Set up necessary accounts for GST/HST, payroll, corporation income tax, and other program accounts.
2. o Use CRA-approved digital services for secure online management of business tax matters.

3. Financial Recordkeeping

1. o Maintain accurate records of income, expenses, assets, and liabilities.
2. o Understand reporting obligations for forms such as T2125 (Statement of Business or Professional Activities) and other applicable filings.

4. Payroll and Deductions

1. o Properly calculate and remit payroll deductions for employees.
2. o Set up new employee records and comply with CRA standards.

5. Tax Reporting and Filing

1. o Report business income and expenses accurately on tax returns.
2. o Ensure timely GST/HST filings and corporation income tax returns to avoid penalties.

6. Liaison and Support Services

1. o Utilize the CRA Liaison Officer service for guidance on small business tax obligations.
2. o Access digital services for filing returns, making payments, claiming credits, and registering for direct deposit.

Additional Considerations for New Businesses

1. • Acquiring or Expanding a Business: Determine fair market value of assets and understand GST/HST implications when purchasing or expanding a business.
2. • Business Audits: Be prepared with proper records and documentation if selected for a CRA audit.
3. • Program Account Updates: Make timely updates to CRA accounts when business circumstances change.

For further details on CRA programs, obligations, and digital resources, visit Small Businesses and Self-Employed Income.

Additional Considerations for New Businesses

1. • Acquiring or Expanding a Business: Determine fair market value of assets and understand GST/HST implications when purchasing or expanding a business.
2. • Business Audits: Be prepared with proper records and documentation if selected for a CRA audit.
3. • Program Account Updates: Make timely updates to CRA accounts when business circumstances change.

For further details on CRA programs, obligations, and digital resources, visit Small Businesses and Self-Employed Income.

Why Choose Momentum Accounting CPA Professional Corporation?

1. • Licensed CPA firm with expertise in small business taxation and compliance
2. • Local knowledge in Hamilton and Toronto while offering remote services nationwide
3. • Guidance on CRA program accounts, GST/HST, payroll, and corporate tax
4. • Secure online consultations and filings through CRA-approved software
5. • Personalized advice for small business owners to minimize taxes and maintain compliance

Get Started with Your Business Today

Launching a small business requires careful planning, accurate reporting, and ongoing compliance. Momentum Accounting CPA Professional Corporation provides expert CPA support to help you set up, manage, and grow your business confidently.

📞 Contact us today to schedule a consultation and learn how we can assist with business registration, CRA program accounts, tax compliance, and virtual services for your new business.