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innisfildaycare
07-28-2014, 02:45 PM
Hello everyone,

I am new to the forum and had a couple of questions. I would greatly appreciate any help!

1) When I file my taxes next year, (Ontario) I'd like to pay into EI. Would I just let my accountant know at that time, or do I have to sign up for it with service Canada?

2) Also, once we do pay into EI, how does it work. When we have no children are we able to collect, or is it a certain of amount of $ per work you are able to claim, even if you have 1 child or 2? How does the EI work when providing care from home?

3) Currently I am on EI. I hold a position in which lays me off each summer due to slow season, however I return every September. If I were to quit my job, and open am in home daycare, would I be able to continue to collect EI or some of it until I get some clients?

4) how much percentage of home expenses (electricity, etc) are we able to claim when filing our taxes and what expenses can we claim?

5) How much percentage of daycare expenses (toys etc) are we able to claim?

Sorry for all the questions. Im debating starting an in home daycare!

Thanks for any help!

mickyc
07-28-2014, 03:07 PM
1) When I file my taxes next year, (Ontario) I'd like to pay into EI. Would I just let my accountant know at that time, or do I have to sign up for it with service Canada?

In Manitoba we just sign up through Service Canada, I imagine it is the same there.

2) Also, once we do pay into EI, how does it work. When we have no children are we able to collect, or is it a certain of amount of $ per work you are able to claim, even if you have 1 child or 2? How does the EI work when providing care from home?

You have to pay into EI for a year before applying for it. It is calculated on your net income. you only would receive 55%. I think the max you can pay into it a year is around $850. There again check the service Canada website for full details.

3) Currently I am on EI. I hold a position in which lays me off each summer due to slow season, however I return every September. If I were to quit my job, and open am in home daycare, would I be able to continue to collect EI or some of it until I get some clients?

This is also something that you would be best to call Service Canada and ask about. There will likely be an amount you are allowed to earn before it gets deducted from your current EI payments. Any amount you make over that would be deducted from your EI that are paying you. You need to check and see what the amount is that you can make without it being deducted from your EI payments.

4) how much percentage of home expenses (electricity, etc) are we able to claim when filing our taxes and what expenses can we claim?

I claim 50% of my home for daycare as it is in my full basement. That means I claim 50% of all expense - hydro, water, TV, internet. I claim a portion of my vehicles (insurance, gas, interest on loans), my property taxes, my interest on mortgage, house insurance, household repairs/renos, huge purchases like a new fridge/computer/washer etc. (my accountant figures out what percentages of everything, I just give him the totals). As far as all daycare supplies like daycare furniture/toys/crafts supplies/office supplies etc I claim 100%.

5) How much percentage of daycare expenses (toys etc) are we able to claim?

100%, see above


When it comes to CPP and EI my accountant figures out what I owe for each when he does my taxes.

CrazyEight
07-28-2014, 10:25 PM
In response to being able to collect EI while working, I came off of a Maternity Leave from a full-time job outside the home a year and a half ago. It COULD have changed since then, but as far as I know, you can only make $50 a week on top of your EI payment. If you make more than that, you have to report it to the CRA, and they deduct that dollar for dollar from your EI.

Technically you could stay on EI until you are full, but it depends on how fast you fill up and what you are charging - you may not be able to collect anything once you get a few children.

Rachael
08-26-2014, 01:53 PM
I think much of your question has been covered, however, I'd like to add some clarification.

Being self - employed and paying into EI does not give you the same coverage you have when contributing as an employee. Before signing up for it, make sure it's actually beneficial for you to have based on your personal situation.

http://www.servicecanada.gc .ca/eng/sc/ei/sew/index.shtml

EI for the self-employed does not cover instances where you have no clients. When you have no children you will not receive EI. All businesses have times when they are booming and times when they are lean. This is not a payment to cover the lean times.

What it does give you is maternity benefits, parental benefits, sickness benefits, compassionate care benefits and some income if you have to quit your business to care for a critically ill child of your own.

So for me, I am mid 40's now and single so the maternity benefits are no good to me. Likewise, the parental benefits are less helpful since mine are late teens. Although the compassionate care benefits might be nice, with my extended family in another country, the reality is it will fall to my siblings to provide that as I can't leave my life here for weeks on end, even in this situation. As you can see, the benefits for me, are none but you have to assess if payment gives you any coverage you would use based on your situation.


In terms of the percentage of home expenses, the it varies depending on the set up.

What we are meant to do is for shared family/daycare space, work out what square footage is used for the day care as a percentage of the entire home. Then multiply that by (hours of business / 24 hours in a day) and multiply by (days open per week/7 days a week).

So - I have a split level. Every single room in my house is used by the day care and the family.

100% x (12 hours a day open/24 hours a day) x (open 5 days a week out of the seven day)
100% x (12/24) x (5/7) = 35%

So for a home which shares every single square foot of the property with day care and which is open 12 hours a day during the week but closed at weekends, the max the tax man would expect to see is a claim of 35%. Many would be less than that.

The only time it would be higher, is if you had square footage which was completely dedicated to the day care and never used by the family as then you wouldn't be dividing those cost by number of days a week you are open and hours per day you are open. Every hour of every day that day care space would be solely for day care and unoccupied after closing. In that situation, you would take your entire sq footage and divide it by the day care square footage and use that percentage to determine how much of your home expenses could be written off against the day care.

You might find this helpful. It's produced by CRA and is a guide for what you can claim when using your home for day care. http://www.cra-arc.gc.ca/E/pub/tg/p134/p134-13e.pdf