The Many Hats of Self Employment

Being self employed comes with many benefits.  You can sleep in, work in your pyjamas and go shopping in the middle of the day.  You no longer have to report to a boss who doesn't really understand what you do or deal with mindless workplace politics.  It all sounds wonderful, but unfortunately there are also many challenges.  Small business owners have to deal with uncertainty and risk.  They need to be disciplined and deal with the many demands that being self employed can impose upon us.  In the early stages of self employment, most of us have to take on the responsiblity of fulfilling the administrative functions that you find in a more established business. Some of the skills that you need to develop are:

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Employee vs. Self Employed: Criteria and Considerations

For the majority of income earners, employment status is pretty evident.  If you are going to the same place every day,  have an assigned cubicle with a computer and corporate stapler, and your boss tells you what you need to do, chances are that you are an employee.  Conversely if you have several clients, use your own laptop, and are worried about where your next  sale is going to come from, you are most likely, self employed.

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7 Qualities of Highly Desirable Clients

“I want to create a rival to Twitter. So I want it exactly the same except where it says What’s Happening? I want it to say How are you feeling?”(From the very funny "Clients from Hell")

This pretty much sums up the type of client we don't want - ridiculous expectations, unimaginative and just plain clueless. Conversely, there are some clients that are a pleasure to deal with.  Ones that ask great questions, and make us feel happy to have chosen the entrepreneurial route.  The more important of these are listed below:

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GST and QST Considerations For New Business Owners

The Goods and Services Tax or GST is a consumption tax that is charged on most goods and services sold within Canada, regardless of where your business is located.  Subject to certain exceptions, all businesses are required to charge GST , currently at 5%, plus applicable provincial sales taxes.  A business effectively acts as an agent for Revenue Canada by collecting the taxes and remitting them on a periodic basis.  Businesses are also permitted to claim the taxes paid on expenses incurred that relate to their business activities.  These are referred to as Input Tax Credits.

Does Your Business Need to Register?

Prior to engaging in any kind of commercial activity in Canada, all business owners need to determine how the GST and relevant provincial taxes apply to them. Essentially, all businesses that sell goods and services in Canada, for profit, are required to charge GST, except in the following circumstances:

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Breaking Up with a (Likeable) Client

Many of us have clients who are annoying, cheap, stupid , high maintenance or some combination thereof.  As a new business owner, we are often stuck with these clients because we need them.  However, we look forward to the day when we will have the thriving business that we so deserve, and fantasize about the spectacular way in which are going to fire them (you can shove your business into your rear orifice etc.)  This is actually a productive fantasy as can help to channel and concentrate anger.  Of course, in the majority of cases, a firing should be conducted with slightly less vigour.

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10 Year End Financial and Tax Tips for Your Small Business

As the end of the year approaches, some of us find ourselves overwhelmed by top 10 lists, the shopping masses and endless renditions of Winter Wonderland.  Businesses, on the other hand, tend to experience a slowdown, which makes it the perfect time for small business owners (when not partaking in holiday madness) to take a closer look at their overall business, financial and tax situation.  A thorough review and analysis of your business will allow you to optimize your current financial situation as well as prepare for the future. 

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How to Prepare a Business Budget

One of the primary challenges facing a small business owner is uncertainty about the future. (It is also what makes entrepreneurship exciting).  We may have an amazing product or service, but we can’t be sure whether this will actually translate into a profitable business model.  A budget is an excellent tool to manage uncertainty and, contrary to popular belief, can actually be fairly straightforward to prepare, particularly for small businesses that do not have to worry about different departments, product lines and geographic areas .

A budget, very simply, is a tool that helps you predict your sales, expenses and profitability as well as your cash flow needs.  It is based on estimates, which in turn are based on a combination of experience, history and industry knowledge. In terms of presentation, a budget should essentially mirror your financial statements and will include the following main categories:

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9 Tips For Managing Your Customer Receivables

Having Accounts Receivable i.e. amounts owing by customers is both good and bad.  It's good because it means that you have sales and customers.  It's bad because it is cash that you don't have now, and there is always a possibility that you won't collect.  When you offer credit terms to your customers it is extremely important to have a system in place to manage your accounts receivable.  It is difficult to collect amounts due when you don't actually know how much you are owed or when it is due.  Having the information at your fingertips  (this really relates to any kind of information) also makes a great impression. Below are some steps to help manage and collect on your accounts receivable:
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Accounting for Non Accountants : Debit, Credits and Financial Statements

When people hear the term accounting, there is an involuntary reaction whereby the comprehension centres (the medical term) of their brains tend to shut down, and sleep mode is activated.  This is unfortunate, as accounting, especially to a small business owner, can actually be quite interesting.  It is one of the primary tools by which business owners and other interested parties can gage the success of their business, as well as identify areas that require attention andneed improvement.  To understand accounting, business owners need to have a basic understanding of how it works (debits and credits) and it's results (financial statements), explained below:

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