Pay the Right Price with the
Right Business Tax Accountant
Does your company have to pay taxes in Quebec and in Canada? Depending on the type of business, residency status, income, and a host of other factors, it’s not always straightforward to predict how much corporate tax you’ll have to pay.
A Quebec business, like individuals residing in Quebec (see personal tax accountant), will have to pay income tax according to the tax rates in effect.
The good news is that mechanisms put in place by governments can reduce your tax burden. However, you still need to know them!
This is where our business tax accountant comes in handy, so you can benefit from professional tax services and pay the right price!
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Company Types Required to Pay Tax:
Incorporated Companies:
- End with “inc.” », « ltee. », « ltd »;
- Are legal entities in the eyes of the law;
- Must file a tax return;
- Are distinct from their owner(s);
- Own the company’s assets, such as debts.
- Must file a corporate tax return;
- If they pay dividends to its shareholders: the latter are responsible for adding them to their income in their tax return.
Partnerships:
- End with “S.E.N.C.” ”;
- Are directly related to the owners;
- Do not own assets and debts. The persons responsible for debts and assets are the partners of the company;
- Are not legal entities in the eyes of the law;
- Do not have to file tax returns;
- The losses and income generated by the partnership’s management must be included in the partners’ declaration. They will in turn have to include it in their personal tax return.
Business Tax Accountant
Determining a Company’s Residence
A corporation — like a person — must pay tax in Quebec and Canada if it is considered a resident of Quebec. Hence the importance of knowing your specific residence status.
To determine the company’s residence status, we proceed as follows:
- We find out if the administrative control is in Quebec;
- If the major decisions are made in Quebec, then the company will be said to be resident in Quebec, and it will be taxed on its income from worldwide sources.
- If not, we verify whether the company was incorporated in Quebec or not;
- Yes: then, it is considered a resident of Quebec for the whole year and will therefore have to be taxed on its worldwide income;
- No: it is considered a non-resident of Quebec and will be taxed on its Canadian income.
Are you the owner of a trust? Note that our accounting firm also offers trust tax services!
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The Main Steps of Corporate Tax Return
Bookkeeping
Bookkeeping with a corporate tax accountant helps to accurately complete the declarations requested by:
- Canada Revenue Agency;
- Revenu Québec;
- Or the Registre des entreprises du Québec.
Presentation of Financial Statements
This is the result of bookkeeping. The financial statements are presented in several stages:
- We start with the balance sheet, which is a frozen image of your assets at the financial year’s end. The formula is: Liabilities + Equity = Assets;
- Then, the income statement measures your business management performance. This indicates all the income generated by the sale of products or services, the expenses incurred by the company, and the total profit;
- After this comes the cash flow statement which analyzes your financial situation, and therefore your ability to self-finance;
- The statement of retained earnings then allows you to see what the company’s cumulative profits are after the payment of dividends or distribution to shareholders;
Everything is accompanied by notes on the financial statements. These notes explain the method used for the preparation of the financial statements and provide more details on the company’s financial situation.
Corporate Tax Return Filing
The income tax return is produced from the company’s tax profit.
The tax profit is determined from the accounting profit, which will be increased by the various non-tax-deductible accounting charges (e.g. accounting depreciation, representation costs, fines, and penalties, etc.) This will be increased by tax charges provided for by tax law (such as tax depreciation).
Several other important factors influence the calculation of corporate tax such as the number of hours worked by employees, the tax profits generated by associated companies, and the receipt/distribution of dividends from connected or unconnected companies.
Tax Payable
Once the amount of tax to be paid has been determined, the company must pay this amount to the government.
We know that poor budget planning can be detrimental to company liquidity. It is for this reason that at EB Conseil Fiscal Inc., we issue payment recommendations to optimize the management of this expense.
In the event of a tax objection, our team is also at your disposal to settle disputes with government agencies.
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Receive Corporate Tax Support with EB Conseil Fiscal Inc.
At EB Conseil Fiscal Inc., we offer complete accounting services to assist you in managing your daily accounting operations. With the help of our business accountants, you can now confidently take the best financial decisions and tackle tax planning.
In need of a business tax accountant? Look nowhere else!