As a sole proprietor, there are more effective ways to increase your earnings than to just work more hours. But you need to know about the intricacies of running your own business.
Keeping Your Receipts
As a sole proprietor working through our pharmacy and healthcare recruiting agency, you are likely to accrue many different expenses, that aren’t covered by RPI Consulting Group Inc (us, the recruiting agency) or the Client you are working for. You should keep your receipts for business expenses such as:
- food purchases
- fuel
- mobile phone bills
- car maintenance
When you are busy working a long shift every day, you are more likely to eat out. This is especially true if your accommodation does not have a kitchen where you can cook. Don’t assume that, if we or the client finds you accommodation, that it will be equipped with a kitchen.
Not everyone can save money by walking to work or taking public transportation. If the location of your locum assignment is only accessible by car, you will inevitably spend money on fuelling your vehicle. You may even inflict some wear and tear to your vehicle, and every car-owner knows that a lot of maintenance is needed to keep you mobile.
Part of working with a placement agency like RPI Consulting Group Inc. is maintaining contact with your account manager/recruiter. We will communicate with you extensively by phone and email prior to the start of your job. We will likely call you to check up on your progress through the jobs we place you in. You may even have questions during your contract. This requires you to spend time on the phone with us, or even mobile phone data for email communications.
At the end of the tax year, you will need to fill out CRA tax form T2125. Apart from stating total business profits as a sole proprietor, you can claim expenses to reduce the amount of tax you are due to pay the government. An accountant or accounting software can help you with the specifics.
When you keep your receipts, you can claim any of the expenses listed above, and perhaps more that haven’t been listed. The reason you need to keep receipts is because when it comes to filing your tax forms, you could be audited by the CRA. Your receipts serve as proof that you legitimately incurred the expenses you claimed.
Becoming Incorporated
If you plan to work as a locum pharmacy/healthcare business long-term and claim expenses, you could benefit from becoming incorporated. For one thing, incorporating will bring the amount of money owed in taxes down. Working as a corporation will mean that your business finances are separate from your own personal finances. This is a layer of protection in case your pharmacy/healthcare service business ever folds.
To incorporate, you need to first choose your business name. Then you need to get a business number. For a fee of between $200 and $250 dollars, you can incorporate federally and provincially.
How Collecting HST/GST Would Benefit You
The last thing to consider is to register for collecting HST (Harmonized Sales Tax)/GST (Goods and Services Tax). As mentioned in the link above, you are only required to obtain a HST/GST account when your business earns over $30,000 per year; but you can have certain business taxes reimbursed if you obtain a HST/GST account before earning that amount. The world of taxes and running a business is very complicated, but our account management team would be happy to provide you with information.
