As we all know, 2020 was a year we will all never forget and brought along a lot of changes for everyone!

Well now CRA has made changes to the T4 slip that are required to be applied by ALL employers to assist CRA validate payments under the Canada Emergency Wage Subsidy (CEWS), Canada Emergency Response Benefit (CERB), Canada Emergency Student Benefit (CESB).

For the tax year 2020, in additional to the normal boxes, you must complete the following codes for each employee:

• 57 - Employment Income - March 15 to May 9
• 58 - Employment Income - May 10 to July 4
• 59 - Employment Income - July 5 to August 29
• 60 - Employment Income - August 30 to September 26

For more information, visit CRA's bulletin!

Goal setting can be intimidating and overwhelming, I find the biggest reason people don't set goals is because they truly don't know how to set goals. Below is a framework on how I create my goals :)

BRAINSTORM 
Set a timer for 5 minutes, imagine that this piece of paper is your wish fairy  and everything your write down WILL come true. Think of what your ideal life is if you could literally do anything, think of this paper as the list of how you will make that happen.

1. Ask yourself, “if I could be anything, do anything, or have anything what would it be?”
2. Write down everything that excites you.
3. DO NOT feel you need to be realistic, there is absolutely no judgement, no one will read what you write down so there is no reason to justify it!

 
REVIEW
Review all of the goals you have written down and narrow down your list to what you believe is your truth and what must happen for you.

1. Do this by asking yourself, is this something I truly want, does it get me to my 5, 10, 20-year plan?
2. Is it important enough to spend hours of my time and effort on?

 
PUT IT ON PAPER
Write each down each goal from above leaving space for further detail.
 
ACTION PLAN & MAKE IT MEASURABLE
Create your action plan for each goal by ensuring it is SMART (Specific, measurable, attainable, realistic, timely).. Write out:

1. How you meet the SMART objectives,
2. How you will incorporate the goal in your habits,
3. How you will celebrate your successes along the way.

 
VISUALIZE IT
Begin the work on your vision board!

1. Find a spot where you will be able to see these goals daily.
2. Add your goals, action plan, and timeline.

 
TAKE ACTION!!!
Lastly and most important, take action on your goals! Use your goals to help you make decisions in your day to day life, and then CELEBRATE any and all of your successes, no matter the size!

Jennifer H.
Xo

Click the button below for a template that will help you organize your home office expenses for your sole proprietor tax return.

Putting off doing your taxes because you don't know where to start. Click the button below for a checklist to help you organize and gather everything you need!

🎄✨Another challenge to support local when gifting to employees ✨🎄

Did you know that if you gift your employees cash or gift cards at Christmas time, you are creating a taxable benefit for them (meaning they will have to pay tax on the amount you gift!)

Any gift that is cash, near cash, or non cash is a taxable benefit to employees. However CRA has created a policy which allows employees to receive certain gives for certain holidays/events without creating a taxable benefit.

So let's first discuss the 3 types of gifts that are in the policy so you have an understanding how each play out.

• Cash - This is as it states, cold hard cash!
• Near Cash - This would be anything that is considered to be almost as good as cash and provides your employee with choice; the easiest example is a gift card.
• Non Cash - This would be an actual gift (a book, or a toaster) or a voucher for a specific event. For example tickets to a set concert, or a voucher for a turkey at a grocery store.

Okay, I know the voucher part is confusing, how isn't that a near cash gift. The reason is because the voucher doesn't allow any choice for the employee, they can go get a turkey and that is it. 

To give another example, a movie voucher would be considered near cash as the employee can go see whatever movie they choose. However if you give them a ticket to one specific movie at a designated time, this would be considered non cash.

Now, when does a gift become a taxable benefit for the employee and when are the situations that it is not?

Let's get the cash and near cash gift out of the way first...if you gift an employee cash or near cash, regardless of the reason or amount it is taxable to your employee. You must add the amount to their T4 at the end of the year. There are no exceptions to this.

The rules change however when you are gifting something that is non-cash. 

You are able to gift an employee non-cash items under a total value of $500 for special occasions like a religious holiday, birthday, wedding, or birth of a child. 

The $500 total is for the entire year, so you can gift an item valued at $500 for each event, it is the combined total. if you gift anything above and beyond the $500 it would then become a taxable benefit for the employee. However only the amount beyond the $500 would be a taxable benefit (Gifted items valued at $650, $150 becomes a taxable benefit).

The $500 value is also based on fair market value, which means if a supplier gifted you an item (costing you $0) and you in turn gifted it to your employee (let's say it is a coffee pot that retails at $200) then you have gifted your employee $200 in value.

Items of small or trivial value are not included in this totals, these would be items such as:

• coffee mugs
• t-shirts with employee logos
• Coffee
• Pens

I hope this little explanation helped you understand the gifting policy with CRA and you are well equipped to buy your employees gifts without creating a taxable benefit for them 🎅

For more details on the policy you can visit the CRA website at:
https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/benefits-allowances/gifts-awards-social-events/gifts-awards-long-service-awards.html

Jennifer H.
Xo

🎶 It's the most wonderful time of the year 🎄🎁⁠

But with the most wonderful time of the year, often comes as the most stressful time of the year for most; mentally and financially. ⁠

The first thing you need to do before anything else during the holiday season is put together a HOLIDAY BUDGET 🗒️ 💵 it is an absolute must!

Most of us do put a budget together, but it usually only includes amounts for gifts. We usually forget to include the other things that can end up costing just as much as the gifts, like decorations, food for holiday dinners, snacks for the get togethers, holiday attire and beverage for the parties, and donations to local charities.⁠

So how do you put together a budget? Follow along these steps and you will come out with a full proof budget:

1. Make a list of the following:
   1. People you need to buy gifts for
   2. Decorations you need
   3. Meals you need to prepare and what you serve at these meals
   4. Holiday parties
   5. Donation list
2. Now, next to these lists, put dollar amounts you would like to be able to spend next to each. Be realistic in this exercise, don't just throw $50 on the grocery list, go through and think about how much each item will cost. 
3. You will now have an idea of what Christmas is going to cost you, it might come as a shock, or it might be what you expected.
4. Next go back through the budget and think about your overall financial goals, ask yourself if those gifts, decorations, or holiday attire are important enough to cut into your overall goals. If they aren't go back and make adjustments to your budget.
5. Next tip I'll help your create a holiday shopping list that fits in with your budget.

After you have created your budget you might realized you don't have the available funds to cover it, you may need to look at going into debt for Christmas. We always want to plan and avoid this from happening, but we need to be realistic and often debt is inevitable during the holidays (and trust me, you aren't alone!).

The worst thing to do and what we must avoid is saying, "Ahh screw it, I can't afford Christmas so I am just going to have a good time and spend as I want and not keep track of it." Trust me, this mind frame will put you in debt further than you except or will be prepared for.

BUT what we NEED do is control the debt. If we know ahead of time the debt we will need to create, we can manage it throughout the holidays bu sticking to our budgets and lists and after the holidays we won't be in shock and can then build a plan to manage this debt.

And this is called being financially responsible (YAY!). 

​So even if your holiday budget puts you in debt, stick to it! You will be thankful after the holidays when you open your credit card statement and see exactly what you were expecting and have a plan to manage it!

Happy Holiday Financial Responsibility!

Jennifer H.
Xo

The only advice you will EVER need when starting or running your business is you MUST open a bank account that is completely designated for business; and separate from your personal account!⁠

I mean if you want to get me going, I’d actually suggest to open at minimum 4 accounts, but I'll get to that on another post, and 1 is a VERY positive start!⁠

I see a lot of people running their business and personal finances through one account, and trust me, it just doesn’t work!⁠

You cannot properly manage your cashflow and the success of your business if you are needing to dodge around grocery, entertainment, medical, and all other personal expenses.⁠

Cashflow
Cashflow is an essential part of our businesses, its honestly the blood line. So when you have business and personal all mixed together you will properly often need to go for transfusions (see what I did there...). When it is together, how do you know when you buy groceries you are taking away from the cash to pay for you business insurance, or when you buy office supplies are you taking away from your mortgage payment?

You will always feel financially overwhelmed and stressed because you will be relying on that brain of yours to keep track of everything happening. I don't know about you but just no thanks!

Canada Revenue Agency 
And if the cashflow reasoning wasn't enough, CRA headache should be all you need. If you are selected for an audit and CRA asks for your bank statements (and they will) they are going to make you categorize each expense within your account to state if it is personal or business. And then when there is an expense that crosses over (for instances Home Depot) you bet they are going to ask for the receipt.

How much easier would it be to hand over a statement and say, EVERYTHING is business, done, no more explanation. 

You really need to trust me on this one, separate those funds! It will save yourself SO much hair; it won't be falling out from stress and your won't be pulling it out because you are confused and there is so much going on. 

Jennifer H.
Xo

​How many times have you heard, "Shhh...you shouldn't tell people about your financial situation!"⁠

WHY? Like seriously, why is/was this ever a thing?⁠

Because of this statement a lot of us find ourselves out for dinner with friends ordering just a small appetizer because "we had a big lunch," or we find ourselves buying Christmas gifts outside of our budget because, "Well that is what they will be spending on me."⁠

And this is NOT about telling people you can't "afford" it or you are too "poor," this is negative money thoughts. It's about letting your friends in on your financial goals and priorities.⁠

Once you start talking about your financial goals and priorities I promise your friends and family will be on your side! And I bet they will even start their own!⁠

Now you're saying, "okay Jenn, this all seems great, but bringing it up it intimidating and nerve wracking!" Here are a few suggestions on how you can bring your finances into the conversation in a natural way:

• "Instead of dinner out, would everyone like to come to my house for a potluck? I'm working on saving for my 1st house and prioritizing my spending."
• "Who would be interested in making Christmas gifts this year? I almost have my credit card paid off and I'm motivated and don't want anything to set me back from reaching my goal."
• "This sounds like a fun day you have planned. I'm going to plan to join you after lunch. I'm currently paying off my student loan and it is my biggest priority right now, If I join after lunch, I'll be able to stay on track with my loan and participate and be present for the rest of the day!"

The examples above can be molded to fit most situations.

The important part is that you stay positive! Talk about your priorities and goals, and the more you talk about these the more you are keeping yourself accountable.

When you let your friends and family know about your goals and priorities, they will understand your decisions and will also motivate you to reach these goals! 

I know you can do it!!

Jennifer H.
Xo