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I have small, tiny business that is freelancing. and I am…

Customer Question
I have small, tiny...

I have small, tiny business that is freelancing. and I am thinking to get business register. But I have a full time job as well, and I am not sure which company structure I should choose for tax benefit for myself.

Accountant's Assistant: The Accountant will know how to help. Is there anything else important you think the Accountant should know?

Hmm, I earn about 55,000 per year on my full time job, and I earn about 15000 on my freelancing job(which is not registered yet)

Submitted: 8 months ago.Category: Finance
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Answered in 4 minutes by:
1/17/2018
Financial Professional: Carter McBride, Financial Advisor replied 8 months ago
Carter McBride
Carter McBride, Financial Advisor
Category: Finance
Satisfied Customers: 1,436
Experience: Adjunct Professor
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Hey! I'm Carter, I'm a CPA and can help you out with this. The most common structure is an LLC. With an LLC you can chose to be treated as a sole proprietorship, which files a Schedule C, or you could be an S Corporation, which files Form 1120S. If you do a Form 1120S, you need to pay yourself a reasonable wage, which means you also need to file Forms 941 and 940.

Since you are only making about $15,000, the administrative costs of an S Corporation may be too high, so you may want to do an LLC to get limited liability protection and then go with a sole proprietorship for now until your freelance work grows.

Hope that helps. If you need anything else, just let me know. If not, please leave a rating. Thanks!

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Customer reply replied 8 months ago
Thank You for response. I forgot to tell you I'm in Canada....
I am planning to grow my freelance business and thought about go with federal corporation, but I am not sure if it is possible to do the year end and tax reports etc by myself.
Customer reply replied 8 months ago
Oh and Just answer charged me for $52 which suppose to be $5 deposit...
Financial Professional: Carter McBride, Financial Advisor replied 8 months ago

I'm not that strong on Canadian business structures, I'll opt out and let another expert handle that.

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