OTTAWA'S CRACKDOWN ON SMALL BUSINESS TAX LOOPHOLES

The government is planning to implement this strategic plan by targeting professionals incorporated in various businesses. Woefully, this means bad news to all high-income earning Canadians, these changes will cost the professional incorporated individuals large amounts of money amounting to hundreds or even thousands of dollars in their annual taxes. This paper will focus on the article’s overview, and draw connections to three business concepts used in the article. Business Income in relation to Ottawa's Crackdown on Small Businesses Tax Loopholes Business income refers to any revenue or income which is realized from a legal business activity. In other words, it refers to any financial compensation which is generated a trade or company’s operation. On page three of the article it indicates that income earned by any corporation is fully eligible to a certain tax rate, the federal government suggests 15% of the total income for businesses earning more than $500,000.

The law also reasons for individuals who do not need to use all of their money in their lifestyle, these particular individuals can rest in the corporation and can invest in bonds, stocks or mutual bonds. Taxation in relation to Ottawa's Crackdown on Small Businesses Tax Loopholes Taxation refers to the process in which governments claims money or revenue from the general population with the intention of running the country. Ideally, a government always spend the amount of revenue it gains from the taxation, although in many countries in the western world governments often spend much more than they have made them run on a budget deficit. Governments usually use tax to either encourage or discourage particular economic decisions. Capital Gains in Relation to Ottawa's Crackdown on Small Businesses Tax Loopholes Capital gains refer to the profit which results from the sale of a capital asset, these particular assets may include real estate, bonds or stock, where the sale price usually exceeds the purchasing price.

In most cases, the gain is the existing difference between a higher price and a lower price. Consequently, a capital loss arises when the sales of the capital assets are lower or less as compared to the purchasing price. In addition, capital gains may also be used to refer a particular profit which is received from an asset which ideally refers to an investment income. Generally, a capital gain is usually associated with funds and stocks which are inherent to price volatility. With consultations which lasted for about 75 days the project is halfway to full implementation, however, it is unfortunate for the high-income earners in Canada since the changes may see them pay thousands of dollars as tax. the three business concepts which are not only relevant but also form the base of the article are taxation, sprinkling income, and capital gains.