Does your business perform improvements to real property? If so, then you are considered to be a Real Property Contractor for PST purposes.
The definitions of improvements to real property and Real Property Contractor are at the bottom of this post.
A Real Property Contractor (RPC) does not charge PST to its customers on materials and services.
A RPC pays PST on the materials it purchases to fulfill its contracts with customers – unless a specific exemption applies. The PST becomes part of the material expense.
When a RPC (who is GST registered) wants to get a full reimbursement from its customers on materials purchased, the RPC would charge GST on the materials and PST.
Here is an example:
ABC Contracting buys $1,000 of lumber from Home Depot to build new front steps for its client, Miss Brown. ABC Contracting is charged GST and PST on the lumber.
The total Home Depot invoice is $1,120 ($1,000 plus $70 PST plus $50 GST).
ABC Contracting incurs $500 in labour to build the stairs.
ABC Contracting would bill Miss Brown as follows:
Material ($1,000 plus PST of $70) $1,070.00
GST $ 78.50
Total $ 1,648.50
For more information please refer to the Small Business Guide to PST.
Improvements to Real Property
Real property is land and any items permanently attached to land (buildings and structures). Goods that become permanently attached to the land, buildings or structures on installation cease to be personal property at common law upon installation and are called improvements to real property.
You are a real property contractor if, under a contract, you construct buildings, or supply and affix, or install, goods that become improvements to real property or supply and affix, or install, affixed machinery. This includes contractors and subcontractors in the construction industry, as well as other businesses that supply goods with installation services where the goods will become affixed machinery or an improvement to real property or upon installation (e.g. flooring, dishwashers).
There are numerous filing deadlines upcoming related to your 2013 personal and/or self-employed earnings.
- T4s and T5s must be issued by your company and filed with CRA no later than February 28th
- Deadline for contributing to an RRSP for the 2013 tax year is March 3, 2014
- Deadline for filing personal tax returns is April 30, 2014 (note: this has been extended to May 5th)
- Deadline for filing self-employed returns is June 15, 2014 (even if you have some employment income)
- Important! Even though the filing deadline for self-employed returns is June 15, 2014, the deadline for paying amounts owing in April 30, 2014. In other words, you will need to submit a payment to CRA based on a reasonable estimate even if your paperwork is not complete.
Trout Lake Group deadlines:
- Deadline for receiving our clients’ 2013 personal tax information is March 31, 2014. This will give us sufficient time to complete the tax returns. This applies to both “employee” (T4) and self-employed clients.
- We understand clients receiving T3 slips may not receive these until the first week of April.
If you are doing your own bookkeeping for your 2013 personal tax return, please use our checklist to assist with compiling your paperwork.
If you would like us to prepare your bookkeeping, we have a separate checklist.
Following our checklists will streamline the process for filing your tax returns. This will ultimately save you money!
If you are considering upgrading your copy of QuickBooks to 2014, Staples has a pretty sweet deal right now. The regular price for Pro 2014 is $249. The deal they have right now is $100 off! You need to order it online as none of the physical stores in Vancouver appear to have it available (but you could double-check the stores near you by using the availability checker on the website).
The offer is good until December 24th so act fast!
Celebrate small business month with the Small Business BC!
“Small Business Month celebrates the important contributions entrepreneurs make to the BC economy and to their local communities. Now in its seventh successful year, this October we encourage small business owners and entrepreneurs to take the time to develop your business ideas or to find new and exciting ways to improve and grow your business.
With the support of our partners, events and activities will be held right across the province, promoting the many organizations and groups that offer valuable support and resources to help foster the growth of small business.
Small Business BC is once again celebrating Small Business Month by offering free education throughout October.
Entrepreneurs are welcome to attend the free seminars being held at the Small Business BC Education Centre in Vancouver. The free seminars will also be broadcast via webinar so that all business owners throughout BC can also easily access these resources as well.”
Small Business BC is offering a number of free seminars! Check out their website to find out more.
Small Business BC offers a number of seminars and services throughout the year.