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Thanks for all the information. This is really helpful. You can operate a sole proprietorship under your own name Wouldn't this make some businesses uncomfort
by _g2fb 16y ago
Thanks for all the information. This is really helpful.
You can operate a sole proprietorship under your own name
Wouldn't this make some businesses uncomfortable, preferring to give money to "MyProfessionalWebsite.com" rather than "[name redacted]"? Is the ~$50 business name act essentially like just an alias, telling the government/taxman "money paid to MyProfessionalWebsite.com should be treated the same as if money were paid directly to [name redacted]"?
You also mention that this is paid to the provincial government. This is most likely out of the scope of your expertise, but how would this work if I moved? I currently live in [redacted], but might possibly be moving to [redacted] for work in the near future. I'm also from [redacted] and would one day like to move back home (to [redacted] anyway, not necessarily [redacted] specifically).
There is no dollar limit on this.
I wonder where I got the $30k number from then. Thinking back I think this might have actually been "after $30k you're paying taxes you don't need to" or something. Less of a rule, and more of a best practice.
Incorporating: This has two major effects.
I looked it up, and apparently the minimum cost for incorporation in Canada is $200 (plus lawyers fees, if applicable). I'm almost hesitant to go this far at first, since it feels like the risk is relatively low (a moderately well written terms of service/use, a well written disclaimer, and a policy of providing full refunds for even minor disputes - though I'm planning on providing this for free for a few months to get the ball rolling anyway - should hopefully take care of things until I get a job and can pay to incorporate. Who knows, my new boss might take issue with the concept in general and the business will die before it starts.
you file a "statement of business activities" as part of your personal income tax return.
Sounds easy enough.
probably need to collect GST
Is there a guide to such things that you know of?
only for customers who are (a) canadian residents, or (b) registered for GST
If this is targeted to Canadians, I'd assume this becomes a blanket "yes, collect GST" statement. I'd need a GST number for this, I believe. How hard/expensive is such an acquisition?
gives you a choice of whether to register for (and collect) GST or to pretend that it doesn't exist
Given the option, I'd just as soon collect it always, and from the beginning, so I don't need to worry about it later.
Credit card processing sucks. I just use PayPal.
Duly noted, though the same "would businesses take me seriously" caveat applies. My site would attract largely different clients than something like tarsnap would.
If you're handling credit card numbers (i.e., not going through paypal)
Given what you just said, it definitely seems like I'll just deal with PayPal and be done with it. Have you had any problems with them, by chance? There seem to be a lot of complaints about PayPal suspending accounts and generally being unsuitable in a lot of cases. I've heard of other alternatives (e.g. transaction.net, google checkout, etc.) but wasn't sure how things worked in Canada and I haven't had the chance to really dig into the issue yet.
Again, thanks for all the information. You've been extremely helpful and you've put my mind very much at ease about starting this. I couldn't imagine the government really making it difficult for people to start businesses, but you never know.
- cperciva 16y agoThe business name registration is just an alias, yes. It means that you can do things like enter into a contract using your business name rather than your personal name. If you move, I'd assume that you would need to register the name in your new jurisdiction. The $30k number probably comes from either GST (at that point you need to register) or as a rule of thumb for when income taxes start to work out better. As long as you're not doing weird stuff like charging people in picoUSD, GST is quite straightforward. If you go to the CRA website you'll find lots of documentation. The registration process is simple too -- fill out a form, send it in, and wait for a number to arrive in the mail. (I think it's free; if not, it's only a nominal fee.) The worst problem I've had with paypal has been a few customers being blocked from making direct credit card payments -- but after they created paypal accounts everything worked fine. (I'm guessing that they were borderline on paypal's fraud-detection systems, and providing information as part of the process of creating paypal accounts was enough to push them into the 'safe' category). If you're taking payments mostly from Canadians, mostly from businesses, or mostly in >$100 amounts, you might want to skip credit card processing in favour of cheques.