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Hi, I live in BC and am thinking opening Unlicensed Family Child Care this year. I will take care of 1 part time child and 1 full time child. Monthly gross income will be around 2000.
About EI and CPP, is it beneficial to pay in as self-employed?
If somebody could share with those experiences or examples of the amount of paid EI, I will be greatly appreciated!
You can choose to opt into EI. But once you have opted in - you can never opt out. (Till you stop working) A self-employed person cannot receive EI benefits if they quit, so the only reason you would do this is if you are planning to go on mat leave during your time as a self-employed person. You can get mat leave benefits if you are opted in. If not planning to have children, then there is no point to EI. As for the amount, I don't know.
As for CPP, it is mandatory, so there is no opting in. No choice. When you file your taxes, you will declare the income as a self-employed person and they will take 2x the amount a worker would pay. That is because a person who is employed by someone else, pays half and the boss pays the other half. A self-employed person pays both halves of the amount. And again, it is a percentage of the income.
Hi Yuka, I live in BC and I am don't pay into EI as I don't plan on going on mat leave and I pay CPP when I do my Taxes , it may help you a lot to save say around $250- $300 a month for taxes so you have money sat aside
I wish I had known that you couldn't opt out. I will likely never use my EI for mat leave but I guess it may come in handy if I ever needed disability?
If I could do it again, I'd do what Van suggested and just pay myself that EI money.
Also, EI is paid on a percentage of your total income AFTER deductions....which for most of us, is peanuts! It really isn't beneficial IMO
I thought you could opt out if you haven't used it yet?
Oh I forgot you've told me that!! I keep forgetting to look into that....please remind me again in a few days!!! Lol
I'm gonna see if I can find any info on google and I should email my accountant!
You can opt out if you never used it.
I pay into it and likely always will. I like the idea of having some sort of sickness benefits should I ever need them. I never pay a whole pile per year for it so to me it's worth it. If I kept the money I would never actually save anything anyways so no point in saying I could just pay myself because I never would lol
Well it sure is good to know that you can opt out 5 LM :)
Yes it is Van!! I'm going to opt out this year and put money aside on my own. Than, if I don't ever need to use EI, I'll have that money to use when I retire. Paying into EI as a self employed person only gives us "special benefits" not true EI benefits anyways and if we never use EI, it's wasted money spent over the years
I won't opt into EI either, once I take off and get clients for my day care I just opened. EI isn't guaranteed anyway and my end, they do their best to avoid paying out with any excuse they can find, so am not happy losing my money to them in the first place. Good it's optional with your own business at least.