Business Receipts

Christmas is just a short distance from here and with Christmas comes shopping and buying gifts for friends, family and in some cases for clients, to show them you appreciate their business.

Those of you who own a business, and you are buying gifts for some of your clients, may I remind you that you must keep the receipt and it is also a good idea to put on the receipt the name of the person / people the gift is going to.

If you are the type of person that seems to think that just because it is showing on your business statements, that that is proof enough for CRA, should you ever have an Audit. That thought is completely wrong.

Oh yes, the thought of CRA leaves a rather bad taste in your mouth – doesn’t it. Some of you have probably been through an audit and feel that you would rather go through a Root Canal than another Audit with CRA. They almost make you feel like you are some kind of criminal and that you do not know anything about business.  Some people have even wondered where the agents at Canada Revenue Agency got their training or if they even know anything about business and if they even graduated out of “Sandbox” at school.

Some people think that by collecting GST on their sales, that they should be able to keep it even though they get to deduct their expenses from the amount taken in. They must keep in mind that they are collecting this on behalf of the Government. I personally think that General Sales Tax or Goods & Services Tax should be renamed as Grumbling Sales / Service Tax.

So let’s think about this for a moment. You go to the dentist for a check-up once a year and the dentist does a complete check of your whole mouth. The dentist is not saying to you, “I know there is a problem and I am going to find it”. When in actual fact, the dentist has the attitude that he/she is sure everything is fine but they will check thoroughly to be absolutely sure.

Or you go to the doctor for a check-up once a year and the doctor does not have the idea that there is a problem and I am going to find it. Instead the doctor thinks that everything seems fine but I’ll do a thorough check-up just to be absolutely sure.

Some CRA agents give you the impression that they are sure you are doing it all wrong and aim to prove it and some on the other hand, are sure you know what you are doing but want to guide you in the right direction, if there is something wrong. Just like the police, some will pull you over and write you a ticket for the simplest thing while others will let you off with just a warning.

So have a very merry Christmas everyone and remember keep those receipts for supporting your claim that what you bought is in fact a business purchase.