What Small Business Owners Need to Know About Income Tax Instalments

Transitioning from being a full time employee to small business ownership or self employment means that you need to cultivate self discipline.  You can no longer rely on your employer to take care of business functions that do not relate to your job ,and must take a much more active role in ensuring that you remain on top of your obligations whether it is collecting payments from customers, paying bills or ensuring that you do not run afoul of Revenue Canada.  One of these obligations requires that you calculate and pay the full amount of your income taxes when you file your income tax return, rather than having your employer remit deductions from your paycheck directly. In addition to having to calculate and pay your income tax, once you exceed a certain income threshold, you are also required to pay income tax and sales tax instalments.