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  1. #1
    Starting to feel at home...
    Join Date
    Feb 2011
    Location
    Stoney Creek
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    Doing my Daycare Taxes for the first time

    Hello Ladies,

    I have been doing my personal taxes through a tax program for years so I decided to give my business taxes a try this year. I bought Turbo Tax and it seems to be pretty straight forward.

    I have imputed everything i have a receipt for but I was wondering how I can increase my expenses a bit so I don't have to pay so much. I have reviewed the Daycare info they give you on CRA's website and I have included pretty much everything on there.

    Can you use your mortgage payments as an expense or just the mortgage interest?

    Anything else that I may not have thought of?

    Maybe I should have bought more stuff for the daycare

    Thanks,
    Sarah
    ~~Proud Mama and Owner/Operator of Cutie Pie Daycare~~

  2. #2
    Starting to feel at home...
    Join Date
    Feb 2011
    Location
    Stoney Creek
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    I paid someone last year to do them, which was my first year, and she forgot a couple of things (repayment of Home Buyers Plan) and she forgot to add in income taxes I paid of some other income I received. That's why I have decided to go on my own.
    ~~Proud Mama and Owner/Operator of Cutie Pie Daycare~~

  3. #3
    Euphoric !
    Join Date
    Feb 2011
    Location
    Ottawa, Ontario
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    Thank about anything you started using for the daycare that you already had such as a highchair or toys your own kids had outgrown. Those can be sold to the business at the equivalent of garage sale prices (1/3-1/2 of retail).

    Consider a larger portion of some things such as the amount of toilet paper or baby wipes used by the daycare vice your own kids.

    Things you bought seasonally such as christmas or valentines decorations - some could have been claimed with the idea of making the playroom more festive.

    Make sure you are claiming all of your cleaning supplies and maintenance around the house. Batteries for toys - things we just grab from the drawer and don't think about.

  4. #4
    Euphoric ! Inspired by Reggio's Avatar
    Join Date
    Nov 2011
    Location
    Ontario
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    With regards to mortgage ... you can only right off the PORTION of the INTEREST on your mortgage and the PORTION of your Property tax using the equation given by the CRA for us .... so how many square feet of your home you use for business over the total square footage of your home by how many hours a day you are open over 24 hours over how many days you are open over 365 days in a year....and be careful with the Turbo Tax - because their 'program' does not do the equation properly for HOME CHILDCARE which is a unquie business - the equation used in that program is done assuming that the space used for business is NEVER used for personal use as well ... so unless you have a 'dedicated' daycare space with a kitchen, bathroom and playroom where the kids sleep that is NEVER used by family you have to TRICK that program into doing the PROPER % by figuring our your % manually and than putting in a square foot ration that equals that .... otherwise you will write off way more than you are 'entitled' to and in an audit you will end up having to repay any taxes as a result

    Unfortunately we cannot write off the principle because in our case WE own our home the DAYCARE BUSINESS does ... if you DID put the principle in your home down as a business expense when you SOLD your house you would have to claim any PROFIT you make on it as income and pay tax on that - and well ouch when that time comes
    Children construct their own intelligence. The adult must provide activities and context, but most of all must be able to listen. Children need proof that adults believe in them. Their three great desires are to be listened to, to understand, and to demonstrate that they are exactly what we expect."
    Loris Malaguzzi

  5. #5
    Starting to feel at home...
    Join Date
    Feb 2011
    Location
    Stoney Creek
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    Great info ladies!!!

    I especially like the idea of taking inventory on what I already had and am using for the daycare at garage sale prices.

    I used the Daycare in your Home CRA manual calculations for how much of my home I use.

    Over last year, I just found that we were always tight with money (and I was pretty full for most of the year) and I rarely got to make bigger purchases for the daycare.
    ~~Proud Mama and Owner/Operator of Cutie Pie Daycare~~

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