22 June 2022 13:11

How to handle recurring commissions from small business activity from a tax POV?

What expenses can be claimed against commission?

Commission employees can claim expenses which the regular salary employees cannot:

  • Entertainment costs except for golf club and membership fees.
  • Advertising and promotions.
  • Accounting fees.
  • Capital Cost Allowance CCA.
  • Car interest.
  • Home insurance and property taxes when claiming home-office expenses.

What are the 3 types of commission?

COMMISSIONS

  • COMMISSIONS. Straight | Graduated | Piecework | End of Page.
  • Straight Commission. Straight Commission is calculated to be the person’s wage based solely on sales. …
  • Graduated Commission. Graduated Commission is calculated into a person’s pay in addition to his/her regular salary or wage. …
  • Piecework Commission.

How do I avoid paying taxes on commission?

Bonus Tax Strategies

  1. Make a Retirement Contribution. …
  2. Contribute to a Health Savings Account (HSA) …
  3. Defer Compensation. …
  4. Donate to Charity. …
  5. Pay Medical Expenses. …
  6. Request a Non-Financial Bonus. …
  7. Supplemental Pay vs.

What are the pros and cons of working entirely on commission?

The Pros and Cons of Commission-Only Jobs

  • – Your schedule is your own. …
  • – You control your income. …
  • – You might have unlimited earnings potential. …
  • – You know exactly how well you’re doing. …
  • – You’ll probably work more independently. …
  • – Your income can fluctuate greatly. …
  • – You might be seen as high-risk.