20 - Nerth Shore News - Sunday, December 3, 2000

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YOU don’t need to : incorporate to get many .. of the tax breaks of hav- ~ ing your own business, whether it’s a full-time : or'sideline activity. ., But an incorporated busi- ness can offer additional advantages i in certain situa- tions, ; “oc First, the business should be prontable. You as a sole

888 475-4447

rporat

proprietor may deduct losses from other income (salary, investment, pension). A com- pany can deduct losses only from profits.

Then you should be saving a fair bit of the money earned by the business to benefit from the lower tax rate small com- panies enjoy.

Example: The business earns a $50,000 profit. If you need this money to five on, your company pays it to you (or other family members who work in the business).

You (family members) pay tax at the personal rate of up to about 50 per cent — the same as if you (they) had earned the money directly,

- without flowing it through the * company.

But if you don’t need the -

Money, the company pays only

Bu ing ye usiness can save y

BUSINESS

around 20 per cent vax (the rate depends on the province) on its frst $200,000 of active business profit. On a $50,000 profit, that leaves about $40,000 to be invested — compared with as little as $25,000 if you (family mem- bers) received the money.

A company also has more flexibility about when and how it pays out the money (salary, dividends, bonuses). A compa- ny can be used to “freeze” the value of appreciating assets to defer income tax to the busi- ness founder's children, for example. :

An individual's death can produce an income tax bill when profits are deemed to have been realized. But a com- pany doesn’t die, so when a family member/shareholder dies, that doesn’t nigger any

ur fami ju taxes

iy

income tax on the company’s investments.

Bottom line: Project and compare benefits like those above and costs (setup fees, ongoing tax filing and other expenses) to see if incorporat- ing would make sense.

A company can also limit your liability but in practice, you often have to sign a per- sonal guarantee so you end up liable anyway if the company can’t pay its debts, for example.

— Mike Grenty is a colum- nist and independent personal financial adviser; he'll answer questions in this column as space allows but cannor reply person- ally. Contact him at P.O, Box 50029, South Slope R.P.O., Burnaln, B.C. V5] 5G3; email mike@grenty.com and see previ- ous columns at <mpmgrenby.cani>.

Park Royal gets new textiies store

THE Eatons-sized hole in Park Royal is closer to being filled.

Linens ‘n Things, one of the largest retailers in brand name textiles and housewares in the world, expanded its operations in Vanceuver with the official, opening on Thursday of its second store in B.C.

The U.S.-based - retailer opened its 47,000 square foot superstore in Park Royal — one of the largest stores in the Linens ‘n Things chain and the

biggest Canadian outlet to

date.

Linens ’n Things opened i its first locations in B.C. and Alberta fast March and’ has plans to open more locations in Ontario and B.C. in the first quarter of 2001.00

“We are very excited about expanding .our Vancouver operations. Our first : three Canadian locations are: doing very well and have proved that there is a strong Canadian appetite for Linens.’n Things.

We feel that we have something - “unique to offer,”

said Greg Dyer, Western Zone vice presi- dent of Linens ’n Things.

This’) month, the ‘chain opened a store in Mississauga as well as a new location. in

“Edmonton. The Park Royal

location is the sixth Linens ’n

Things store in Canada. The:

first B.C. store is located at 20 175 Langley Bypass (Highway 10} in Langley.

The company carries well- known and popular brands like

. Wamsutta, Laura Ashley, Royal

Velvet, Braun and Krups: as well as Canadian names Shettex, Umbra, Versailles Home Fashions and Upper. Canada Soap and Candie.

From its founding in 1975 through the late *80s, the com- pany. operated taditional stores

ig from between 7,500 and 10,000: gross sq. feet in

size. In: 1990, however, the

company introduced its super-

store format which has evolved =: from 20,000 gross sq. feet in“

size to its current standard of 32,000 to 47,000 gross sq. feet. ‘ The chain has a workforce ‘ of — approximately 11,000: employees throughout ° the.-. U.S. and plans to hire 240 to. . 300 employees in Canada: over the next 12 months with their .core group of ‘stores’ located.’ in | - Vancouver,’ Calgary, Edmonton’ : and :

: Toronto.

The chain has’ over: 270 stores in 40 U.S. states and’. three provinces and projected. 2000 sales in ‘excess of $1.5-

* billion, The chain has’ been: ~ operating since -1975-and-i

publicly traded’ on the. Nev York - Stock Exchange. under. the symbol LIN.” “A

‘A hours da qT days a week. : WWW.nsnews.com