Kamran – Business Advisor :Business and personal finances are closely intertwined for the small business owner. And if you’re like manybusiness owners, busy running your business, you’re not giving your personal finances the attention they deserve. Did you know that yourbusiness structure impacts how you’re paid and taxed personally? For example, if you’re the sole proprietor, or in a partnership, you’repersonally responsible for all business debts and liabilities. Earnings are taxed as personal income, and any business losses are tax deductible. On the other hand, if your business is incorporated, legally your personal income is considered separate: How to Decorate a Playroom personally you earn a salaryand pay income tax and the business earns revenue, incurs losses, and pays business taxes. Another thing – it’s a good idea to keep your personal and business bank accounts and credit cards separate.
This simple step alone can help you manage your cash flow and business more effectively. Now let’s talk taxes. I know, – but it’s important to take advantage of all the deductions you are entitled to. On a personal level, be sure toclaim all charitable donations, medical expenses, RRSPs and so on. But for your business, you may want to speak to an accountant to seeif you’re eligible for tax benefits like capital gains, business losses and insurance premiums. And finally, keep your investments diversified. Since most of your net worth is likely tied up in your business, spend some time on your personal investment planning, particularly RRSPs asthey’re there to help you reach your retirement goals.
It’s important to balance both your business and personal finances because any decisionsyou make about one can have a direct bearing on the other. To learn more about how to balance your personal and business finances, follow the The first thing to note when buying furniture for the house would be the size of the product. If you’re l… link at the end of the video to our Small Business website to order a free quidebook about Personal Financial Management for Business Owners today.