Goodwill

Goodwill is the excess of the purchase price of a business over the fair market value of the net assets of the business.

Assests

Assets are any property owned by a person or business. Assets include money, land, buildings, investments, inventory, cars, trucks, boats, or other valuables that belong to a person or business.

Business

For income tax purposes, a business is an activity that you intend to carry on for profit and there is evidence to support that intention.

Forms used in personal tax return for business

If your business is a sole proprietorship or partnership, you can use Form T2125, Statement of Business or Professional Activities to report your income and expenses. This from is included in your T1 income tax form package.

How does a sole proprietor pay taxes?

If you operate a business in the form of sole proprietorship, you pay taxes by reporting business income (or loss) on your personal tax return. There is no separate tax return for you business. The business income (or loss) forms part of your overall income for the year.

Inventory

Inventory generally refers to the total value of the goods on hand that a business intends to sell, uses for manufacture, or uses t render a service.

Payroll deductions

Payroll deductions are income tax deductions, Canada Pension Plan (CPP), or Quebec Pension Plan (QPP) contributions, and Employment Ensurance (EI) Premiums which are deducted from an employee’s wages or salary and sent regularly to the Canada Revenue Agency (CRA).

Business Number (BN)

A Business Number is a nine-digit business identifier. It is assigned to you by the Canada Revenue Agency (CRA) when you registered at least one of the four CRA business accounts.