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Tax season is closing in very quickly. I have only been doing the daycare thing since July so this will be my first year dealing with taxes as a business. My question to you: what is the best way to organize all those grocery receipts? I already have them organized into envelopes per month, but for getting totals and organization what do you do?
Thanks
I divide them into categories: Food, Toys and Supplies, Misc and maintenance etc as these are the categories on the statement of business activities. Actually there is no category for food so I either ad it to supplies or put in in one of the blank spots on the form.
Hi, where can I get a statement of business activity? I too am @ the end of my first year and this will be the first time I have ever filed taxes in this country. Any advise would be appreciated - I have saved receipts for EVERYTHING. Also what do I have to do to claim part of my utilities/rent. Sorry to kelleyg19 for hijacking your post :D
I do my taxes online through turbo tax and the statement of business activities is part of the program. If you do the paper method, it should also be in the package, it has been so long since i used paper returns that I cant remember if it is there or not. For rent/utilities you can only claim a portion based on the square footage you use for daycare. All of the info you need is on the Canada Revenue agency website, they have a section called Using your home for daycare.
I attach my food receipts to the backs of my weekly menu's. I highlight all of the items that I purchased and used for that week's food, and then I tally it up. I then have a separate sheet where I keep track of my weekly food expenses. At the end of the year, I just add them up. =) If you use a spreadsheet program (Excel) you can use your computer - I'm an old school kind of gal here. ;) For toys, I have a separate sheet. Again, I keep all the receipts in an envelope. On the sheet I record when I bought the toy, from what store I bought it, what item it is and how much it wa. Every month or so I tally up my spending, and at the end of the year I add everything up. I like this system because it allows me to keep an eye on how much I'm spending on my program. i.e. I spend 77 dollars a week on food (on average) It keeps my budget on track, and it lets me know if I need to increase my rates. (due to food prices increasing I had to raise my rates last year) I also have a final sheet where I keep my Enbridge/Hydro/Home Insurance/Water & Sewar bills. I write off a percentage of these every year (see CRA website for details on how much you can write off) Other caregivers I know also keep their property tax paperwork handy, and their monthly mortgage statements at hand - you are permitted to write off a certain amount of your home if you are using it for daycare. i.e. do you have a designated play area just for the daycare babies, or do you have a room that they use exclusively for sleeping ? Hope that this helps, and don't fret overly. I found that the taxes were pretty straightforward to do, and as long as your not deliberately trying to defraud the system the folks at CRA are very reasonable. I find that CRA tends to get a bit of a harsh rap - they're not big, old meanies. If you make an honest mistake on your taxes (my sister did in her first year as a caregiver) they'll let you know and you just fix it up (either by clarifying details or paying up)Good luck !