[Brad2332]

So I dont know if anyone remembers but my ad sucked and everyhting I've done so far sucked, but somehow, I managed to possibly get a customer. So i'm meeting him tomorrow to take a look at some of his residences that need cleaning etc.

So to the questions:

1) Do I charge him PST as well as GST for a service like house cleaning, I will try to find some guidelines, but its a difficult question.

2) I will do more searching ont his, but how do I give the government there money, they hav't sent me any information or forms which i thought they would on where to send the taxes, how, how often etc.

3) Do i just go visit an accountant???? I can't afford much tho.. if anything....

Any help to these would be GREATYLY appreciated....


By the time my business is going, and operating as i want it, im going to owe you all alot lol.

[Karen]

Congrat's on your first client!

Leave the taxes for now. You can not legally collect them without registering for your GST/PST numbers first, so don't bother with this client.

You also do not have to charge GST if you make under $30,000 so you can get away with not charging the tax.

Go help this client, and then go sort out your tax questions.

But for this client, just go in and do a great job.

Karen

[Brad2332]

Well I guess I kind of blew it then lol. (Starting a business with no experience, and limited time is quite overwhelming, this is a lesson to people out there like me who think they can take on the world lol) There's no chance of me getting in trouble? So if i charge 35 dollars an hour, I am basically doing this under the table so to speak? and will recieve 35 dollars? That works, but for sure tomorrow I will be speaking to an accountant/bookkeeper.

Thanks for the help Karen! And within the month I plan on using your company!

[Karen]

You didn't blow it, have confidence in yourself.

Just take the time to sort out your business structure so that you don't have any surprises later.

Let us know how the meeting goes.

Good luck!

Karen

[mpnetwork]

Hey Brad,

A few things you should sort out over the next month or so...

1. Make sure your business is registered.

2. Your sales this year will probably be under $30K, so you dont have to register. However, if you do you can apply the GST you pay on purchases against the GST you collect on sales.

http://www.cra-arc.gc.ca/tax/busines...st/menu-e.html

3. Make sure you have a vendors permit to collect PST. This one you do need to collect if operating as a business.

http://www.trd.fin.gov.on.ca/userfil..._3_3373_1.html

Hope this helps. If you ever hire an employee make sure to contact the HRSDC to ensure everything is legit

http://www.hrsdc.gc.ca/en/home.shtml

Good luck!

[Brad2332]

So I scheduled my first customer for Monday, let's hope I can get registered and have everything in order for Monday then. I'f I am actually able to get through to the CCRA on the phone, do you think I will get a BN from them? Hopefully....

[Brad2332]

So good news, for me anyhow. I only pay GST once I mkae more then 30K as stated, but also, because I have a non taxable service i dont pay any PST.. thats sweet! haha

[Karen]

Something to consider....

Correct, you do not have to register for the GST until you make $30 K.

However, if you register before that, you can start to claim back any GST you paid for the business. Any GST you pay on your cleaning products, advertising etc, you will be able to claim.

Just food for thought.

Karen

[waveformpc]

I wish our tax system was more like that here in America
And I'm a Bush supporter, LOL...

[Brad2332]

Well, what the lady on the phone had said was to keep track of my expenses, she never said anything about registering and being able to claim the tax. By that you mean get a refund? If thats what you mean what is the difference between paying it and getting a refund, and just keeping it?

[mpnetwork]

Get a software program like Simply Accounting (others here may have other recommendations), this will help you keep track of your expenses and revenue.

This includes how much GST you have paid on purchases.

----

What you will owe to the government will be:

What you have collected on sales -- minus -- what you have paid on purchases.

If you are making money, what you collected should be more than what you paid, and so you will owe the gov't something.

With GST, you have to pay it on purchases, if you dont... its illegal.

----

With PST it works a bit different. Certain sales and purchases you fill out a form with the vendor and then you dont pay the PST.

So if you bought merchandise from a supplier, you would only pay GST (and the PST is waived). Then when you sell it to a customer (assuming its a consumer and at a higher price) you collect PST from them and later pay that to the govt.

Only some purchases are PST exempt.

[Brad2332]

As Iunderstand it this is what will happen:

GST:
I won't pay anything on GST until sales have exceeded $30 000.00, at which point GST is calculated on the amount after $30K.

Does this mean that I continue to track the GST of my purchases?



PST:
My service is tax exempt. There fore I wont ever be collecting PST from customers. However I do pay PST, through purchases of supplies and equipment used with my company. So for instance I buy windex, the PST I pay the government is payed with the pruchase.

So then just to clearify, I am ONLY tracking the GST, to be later used for a refund? Like during this year my GST say for example on all purchases is $500, does that mean I report it and get a refund?