Have you just started your SME or have you recently ventured into self-employment? You may have several questions about your tax rights and obligations. And that’s perfectly normal!
To make things easier for you, Revenu Québec offers you the support program for SMEs and the self-employed. While this personalized and free service does not replace the professional help of an accountant, it does allow you, among other things, to notify you of credits, tax refunds and deductible expenses to which you may be entitled.
With this program you also get assistance in discovering and registering the various online services. If required, you can also benefit from a summary analysis of your accounting records to ensure you have started your business on the right track.
With this service, SMEs and the self-employed can identify and avoid the most common mistakes in tax and income returns.
This support takes the form of one-on-one or group sessions, delivered in person or via video conference. And the whole process is strictly confidential!
Revenu Québec’s assistance program will also help answer your various tax questions. Here are some myths and realities you should know about taxation if you own an SME or are self-employed.
1. The self-employed have to set aside part of their income throughout the year.
TRUE. Unlike employees, the self-employed do not have an employer who takes care of paying the deductions at source. For example, payment of the compulsory contribution to the Quebec Pension Plan must be provided for. In 2023, this was 12.80%.
2. All business expenses are tax deductible.
FAKE. For an expense to be deductible, it must meet the following conditions: it must be incurred for the purpose of generating business income, it must be reasonable in the circumstances, and it must be supported by documentary evidence (invoice).
3. AS A SELF-EMPLOYED OR SME BUSINESS OWNER, YOU CAN CLAIM ALL THE EXPENSES OF USING YOUR CAR IN TAXES AND DUTIES
FAKE. The deduction of travel expenses related to the use of a vehicle is proportional to the percentage of business use. This must be proven by a kilometer register.
4. All self-employed persons must collect sales tax.
FAKE. It is mandatory to collect taxes if your total taxable sales and services exceed $30,000. Note that certain industries (e.g. taxi companies) must register for tax purposes from the first sale and that there are special considerations when calculating the $30,000 threshold.
5. You must keep the registers and books of your activities for 6 years.
TRUE. We are talking about 6 years after the tax year to which they refer. And the same goes for your tax returns. In some situations the number of years may be higher, for example in the case of fixed assets.
Do you own an SME or are you self-employed and would like to find out more about your tax rights and obligations? Registration is possible at Page on Revenu Québec’s support program for SMEs and the self-employed. An agent will contact you as soon as possible to set up an appointment!