Solved: Hey there, I own a small business and I'm willing ...

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Hey there, I own a small business and I'm willing to do the taxes via TurboTax. I paid my self through the small business. Will I be able to get the T4 for that? M.

 
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Hey there, I own a small business and I'm willing to do the taxes via TurboTax. I paid my self through the small business. Will I be able to get the T4 for that? M.

If you are a sole proprietor, you cannot claim wages for yourself, only for an employee.  The reason for this is while you might be able to deduct the wages, you would also have to claim the income.  Your income is the profit from the business, which you pay tax on.

If you are incorporated, you could be an employee of the corporation.  The corporation could deduct the wages but not as an annual figure.  It would at least need to be a monthly payroll throughout the year or a portion of the year.  This would mean remitting your source deductions either monthly or quarterly.

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New Member

Hey there, I own a small business and I'm willing to do the taxes via TurboTax. I paid my self through the small business. Will I be able to get the T4 for that? M.

If you are a sole proprietor, you cannot claim wages for yourself, only for an employee.  The reason for this is while you might be able to deduct the wages, you would also have to claim the income.  Your income is the profit from the business, which you pay tax on.

If you are incorporated, you could be an employee of the corporation.  The corporation could deduct the wages but not as an annual figure.  It would at least need to be a monthly payroll throughout the year or a portion of the year.  This would mean remitting your source deductions either monthly or quarterly.

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New Member

Hey there, I own a small business and I'm willing to do the taxes via TurboTax. I paid my self through the small business. Will I be able to get the T4 for that? M.

If you are not incorporated, then you will not complete a T4 for yourself.  If you are indeed incorporated, then yes you would have had to show monthly remittances for CPP and taxes withheld...filing a T4 at the end of the year will likely get you a PIER review from CRA.  What you can do is show yourself as a subcontractor to the corporation, and any monies that you withdrew would show on your personal tax return as self employed income with no expenses.  Your personal income tax and CPP remittance would be still calculated.  The main difference is the employer's portion of CPP would not be an expense to the corporation...either way the money still comes from your own pocket. 

Something else to consider, if indeed your business is incorporated, is if there are after corporate tax profits (Retained Earnings) then you could show these being paid to yourself as a dividend.  You pretty much would want to have the corporate return completed, or at least reconciled enough to see if there were Retained Earnings, and you would have to produce your own T5 from the corporation.  You need to produce the T5, and send a copy of it and a T5 summary to CRA before the end of February...if you are late, there are harsh penalties ($25 per day, up to 100 days). 

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New Member

Hey there, I own a small business and I'm willing to do the taxes via TurboTax. I paid my self through the small business. Will I be able to get the T4 for that? M.

Good afternoon

This question needs more detail. Are you incorporated? Is this a franchise? many scenarios can come from this.  If its your own business you'd create your own t4a?  or fill in income in T2125 for self employed business? Please clarify ?

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