Starting a small business an idiots guide?

[crunchiespg]

I must be an idiot to contemplate it with the current political climate. But it serves my home life too so I'm looking for some advice. Basically can someone give me an idiots guide to starting a small business in Alberta please.

I'm working on my certificates to be a dive instructor. Typically they work as contractors to local scuba shops.
So I'm hoping to do it as a formal business as I will obviously have travel and equipment costs. Insurance/professional registration requirements and the like. I'm going to be doing it anyway so I might as well balance the books while I do.

I will also eventually change my vehicle to a van for hauling gear etc.
I also will look to offer other "outdoor" activities, sort of a tour guide type set up.

So what's the best process to get started? Register a numbered company? Sole proprietor? Etc etc.
Thank you!

[Red Bullets]

http://businesslink.ca/getting-started

[schmedlap]

DO NOT do your own incorporation. Consult a competent lawyer and get them to do it, and to handle your annual return matters, etc. as you proceed. The extra cost is very small compared to the inevitable cost of fixing it up later. The basic registry agent packages are horribly deficient. Or, the lawyer and accountant may advise not to incorporate, depending on your situation, and set up alternative business mode.
DO consult a competent accountant, retain one, and involve them in your choice of business mode and the details of ongoing accounting, tax matters, etc. The cost will be far less than the cost of resolving your inevitable resultant mistakes and issues down the road.

[jayquiver]

you may also want to talk to an Accountant. There are some liability advantages and tax deferrals advantages of having an incorporated company but it is also very expensive to open and maintain (annual tax returns)

So basically, talk to an Accountant and a Lawyer before you take the DIVE.

[crunchiespg]

I'm thinking I will be very much at the lower end of the income scale from this venture. It's going to be odd weekends here and there and the like. It's certainly not going to be my only job for a while yet.
I basically want a mechanism that I can use to cover expenses such as travel etc. A break even would be fine initially.
Thanks for the tips so far. I'll give it all a good read.

[dale7637]

Originally Posted by schmedlap

DO NOT do your own incorporation. Consult a competent lawyer and get them to do it, and to handle your annual return matters, etc. as you proceed. The extra cost is very small compared to the inevitable cost of fixing it up later. The basic registry agent packages are horribly deficient. Or, the lawyer and accountant may advise not to incorporate, depending on your situation, and set up alternative business mode.
DO consult a competent accountant, retain one, and involve them in your choice of business mode and the details of ongoing accounting, tax matters, etc. The cost will be far less than the cost of resolving your inevitable resultant mistakes and issues down the road.

X2.
A good lawyer and accountant are worth their weight in gold.. I tried the diy method, and eventually ponied up and paid for the pros. Worth every penny!

[Redfrog]

Originally Posted by crunchiespg

I'm thinking I will be very much at the lower end of the income scale from this venture. It's going to be odd weekends here and there and the like. It's certainly not going to be my only job for a while yet.
I basically want a mechanism that I can use to cover expenses such as travel etc. A break even would be fine initially.
Thanks for the tips so far. I'll give it all a good read.

So you mean a business to pay for your hobbies and not have to pay taxes?

[crunchiespg]

Originally Posted by Redfrog

So you mean a business to pay for your hobbies and not have to pay taxes?

no, i mean a business to offset the expenses i incur as a professional dive instructor as i build towards turning it into a more full time form of employment.

i will get paid for the instruction. and i will have to spend money on things like equipment and travel to earn that pay..
sounds like most other businesses to me...

of course the alternative is do it all under the table for cash, which would you prefer?

(plus I've hardly avoided taxes, been paying since i was a child, a rough estimate is I'm about $700,000 in taxes paid so far, and I'm not particularly old...)

[Redfrog]

Originally Posted by crunchiespg

no, i mean a business to offset the expenses i incur as a professional dive instructor as i build towards turning it into a more full time form of employment.

i will get paid for the instruction. and i will have to spend money on things like equipment and travel to earn that pay..
sounds like most other businesses to me...

of course the alternative is do it all under the table for cash, which would you prefer?

Which would I prefer?

Why would I care? You asked for advice. I asked for more info. While you get your panties untwisted, I 'll go for coffee. Good luck with your business.

[crunchiespg]

Originally Posted by Redfrog

Which would I prefer?

Why would I care? You asked for advice. I asked for more info. While you get your panties untwisted, I 'll go for coffee. Good luck with your business.

no knotted panties here, sorry if i mis read your tone...
maybe it touched a nerve as our new Glorious Leader (may peace be upon him) has basically started to tar all hard working Canadians and particularly business owners as scum..

[Clgy_Dave2.0]

Originally Posted by Redfrog

So you mean a business to pay for your hobbies and not have to pay taxes?

Show me this business model where one doesn't have to pay taxes...very interested in that!!

Crunchie....if you're just going to have a small business where there's not going to be money left over at the end of the year...sole proprietorship would likely be more suitable.
Being "incorporated", means much higher book keeping and year-end accounting fees. Two to three thousand for both corporate and personal taxes. SP still enables you to write off all your expenses. (Vehicle, gas, tools, equipment, office supplies, advertising, etc)
Just doesn't protect your personal assets if you're ever sued or planning on going bankrupt.

The best advice is as someone said "talk to an accountant".

[Redfrog]

"Show me this business model where one doesn't have to pay taxes...very interested in that!!"


Dave. I don't think it exists. I asked because there are those who have not been in business think that by having a 'business' you get tax write offs, which in some minds translates to free stuff and no taxes.

In other words , start a business, get everything as a tax write off and paid for by the company[so it's free].

The reality is something much different.

[josey]

Originally Posted by Clgy_Dave2.0

Crunchie....if you're just going to have a small business where there's not going to be money left over at the end of the year...sole proprietorship would likely be more suitable.
Being "incorporated", means much higher book keeping and year-end accounting fees. Two to three thousand for both corporate and personal taxes. SP still enables you to write off all your expenses. (Vehicle, gas, tools, equipment, office supplies, advertising, etc)
Just doesn't protect your personal assets if you're ever sued or planning on going bankrupt.

The best advice is as someone said "talk to an accountant".

That's what I am doing Sole Proprietorship. Incorp is way too much in the beginning. Start small, start with low cost SP and do a good job on the book keeping. Get insurance. I think for your business that would be very important.

[reddeerguy2015]

Incorporate.

Get a lawyer to do this for you. They will also cover anything that needs to be done on a yearly basis for your business. Fees are not bad.

The most important advice i have is find a good competant accountant. Any extra fees you pay an accountant will pay for themselves.

Keep your books under control. If you cant do this have your accountants staff do your books.

Do not fall behind on your corporate taxes.

Enjoy working for yourself. I started my company 4 years ago - and financially im better off than ive ever been. There are times that it is extremely stressful and you just want to punch your company in its metiforical face - but its worth it at the end of the day.

Good luck!

[avb3]

Don't spend any money on accounting software. This Canadian one is free, and constantly being upgraded. You only start paying if you use their payroll module, which it sounds like you won't. You can even invoice your customers and accept online payments from them.

https://www.waveapps.com/

I can help with the setup once you are ready.

[Clgy_Dave2.0]

Originally Posted by reddeerguy2015

Incorporate.

Get a lawyer to do this for you. They will also cover anything that needs to be done on a yearly basis for your business. Fees are not bad.

The most important advice i have is find a good competant accountant. Any extra fees you pay an accountant will pay for themselves.

Keep your books under control. If you cant do this have your accountants staff do your books.

Do not fall behind on your corporate taxes.

Incorporate?!! For a small business to be done on weekends and part time??
He probably doesn't even need to have a GST # for the first year or two, and you think he should incorporate? That alone will cost him $1500 to $2,000. And then to do his T2 will be another $1500 or so, plus his personal return and then corporate bookeeping. Really?? For a part time/weekend side business??

Originally Posted by crunchiespg

...will be very much at the lower end of the income scale from this venture. It's going to be odd weekends here and there and the like.

Originally Posted by avb3

Don't spend any money on accounting software. This Canadian one is free, and constantly being upgraded. You only start paying if you use their payroll module, which it sounds like you won't. You can even invoice your customers and accept online payments from them.

https://www.waveapps.com/

I can help with the setup once you are ready.

I used Wave for a while. It's not a bad program. Probably be alright for the OP. Having cloud based accounting certainly has it's advantage. I tried it for awhile but then went back to Quickbooks Pro. (which is now also cloud base on a monthly subscription basis)

What I found with Wave was:

1. Cant import customer records. Tried importing a CSV file and it wouldn't work. I checked their support forum and found many users with the same problem.
2. Can't import product records
3. Can't pay multiple bills with one payment (have to manually go into EACH and EVERY bill...apply a payment in full, and try to remember when you've reached your total amount paid) One payment towards 20 separate bills will literally take almost 15 minutes of clicking. With Quickbooks it takes about 5 seconds to do the same thing.
4. Same goes for receiving payments for multiple invoices.
5. Can't print cheques for Vendors/sub contractors from within Wave.
6. Very limited Invoice customization...can't add fields or edit field display names.
7. Extremely slow when doing multiple entries (bills/invoices/transactions, etc)

[wildwoods]

Read the E-myth before you do anything. Would have saved a lot of people a pile of grief

[bobcatguy]

Weekend bus. that may grow I would start as sole prop. Find a good accountant they make you money .Write a business plan 1 yr ,2yr ,5yr, & try to stick to it I found it gave me motivation & later ,satisfaction.

[lmtada]

My buddy has a dive outfit in Edmonton. Dive Outfitters. Lorne/Angie Garred run the show. Give them a call. He has a website. Good luck. Do what you enjoy.

[crunchiespg]

Originally Posted by lmtada

My buddy has a dive outfit in Edmonton. Dive Outfitters. Lorne/Angie Garred run the show. Give them a call. He has a website. Good luck. Do what you enjoy.

I've got a dive shop I'm affiliated with. Most of the instructors there work as contract instructors for the courses.
So that's what I'll be doing initially.
Hopefully expanding into something bigger in the future.

[Cottus]

Every dive instructor (including my wife) who I know is not a corporation. Your PADI/SSI Divemaster/Instructor's Liability Insurance will cover you financially in the very unlikely event of a suit. Unless the dive insurance/dive shop you choose requires you to have WCB coverage I would skip the incorporation. You DO NOT need to incorporate to write off business expenses, etc, against your personal income. In fact that's a major reason why most people have small side businesses: to write off their small business expense against their "real job" income. You can't do that with a corporation; as a "corporation" your personal income that you throw at the business does not count as an expense against the corporation's books.

[schmedlap]

Originally Posted by Cottus

Every dive instructor (including my wife) who I know is not a corporation. Your PADI/SSI Divemaster/Instructor's Liability Insurance will cover you financially in the very unlikely event of a suit. Unless the dive insurance/dive shop you choose requires you to have WCB coverage I would skip the incorporation. You DO NOT need to incorporate to write off business expenses, etc, against your personal income. In fact that's a major reason why most people have small side businesses: to write off their small business expense against their "real job" income. You can't do that with a corporation; as a "corporation" your personal income that you throw at the business does not count as an expense against the corporation's books.

If your corporation reimburses you personally for receipted expenses incurred on its behalf, then of course these can be recorded as business expenses of the corporation. You may be thinking of money the individual invests as start up capital(?) - that would go into shareholders loan account (which can be paid back out tax free from profits when that occurs), or to share capital to establish the cost base of shares.

[Skytop B]

I have used corporationcenter.ca three times now and it is really easy to incorporate and they also do your yearly maintenance for a small fee. We do our books old school, your accountant will help you with this, it is not difficult at all.

[Sledhead71]

Sound advise would be talk to an accountant.

Poor advise would be listen to anyone who uses the term "write off".

Good luck and all the best on your venture Crunchie !

[super7mag]

Originally Posted by Clgy_Dave2.0

Show me this business model where one doesn't have to pay taxes...very interested in that!!

Crunchie....if you're just going to have a small business where there's not going to be money left over at the end of the year...sole proprietorship would likely be more suitable.
Being "incorporated", means much higher book keeping and year-end accounting fees. Two to three thousand for both corporate and personal taxes. SP still enables you to write off all your expenses. (Vehicle, gas, tools, equipment, office supplies, advertising, etc)
Just doesn't protect your personal assets if you're ever sued or planning on going bankrupt.

The best advice is as someone said "talk to an accountant".

Absolutely , depending on your income any tax savings from being incorporated will just go to pay a lawyer and chartered accountant .
Talk to someone in the know , you need an idea of monthly/ quarterly/ yearly income so they can advise you right.
I would be looking at singing a lot of Johnny CASH songs if I were you.

[avb3]

There is little advantage from a tax point of view of incorporating until your net profit is in excess of about $60,000 a year.

However, there may well be an advantage into incorporating to protect personal assets. As such, the advice to talk to both your lawyer and a CPA is valid.

If you happen to live in the northern half of the province, I could put you in contact with the executive director of the business incubator where I was a board member for over eight years. He will review your business plan, and don't be surprised if he asks you very probing questions, questions you may not have thought of, or ones that are uncomfortable to answer. He has a very good record of taking off rose colored glasses, in getting to look at realities as clients go forward.