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The Canadian version of the December equipment question, because the rule here is different from the American one and th...
10/03/2026

The Canadian version of the December equipment question, because the rule here is different from the American one and the trap is the same.

CRA's test is available for use. Not ordered, not invoiced, not paid for — and in some circumstances, not even delivered.

For non-building property it is the earliest of four things: the date you first use it to earn income; the second tax year after the year you acquired it; just before you dispose of it; or the time it is delivered to you and capable of producing a saleable product or service.

That last one is the one that governs most equipment purchases, and it has two halves. Delivered, and capable. An excavator on a flatbed on 2 January is a 2027 deduction. So is a machine that arrived in December and was not commissioned until the new year.

While we are here, two things worth having correct for the year.

The 2026 vehicle limits are $39,000 for a Class 10.1 passenger vehicle, $61,000 for a zero-emission one, $1,100 a month deductible lease cost and $350 a month of vehicle loan interest — all before tax. CRA's own small business page still displays the 2025 figures, so check the Finance Canada release rather than the topic page.

And the $1.5 million immediate expensing is gone. It required property available for use before 1 January 2024. If an adviser is still quoting it for a December year end, they are working from an old note.

2026 has two business mileage rates, and the changeover is the middle of the year.1 January to 30 June: 72.5 cents a mil...
10/02/2026

2026 has two business mileage rates, and the changeover is the middle of the year.

1 January to 30 June: 72.5 cents a mile.
1 July to 31 December: 76 cents.

Medical and moving went 20.5 to 23.5. Charitable stayed at 14, as it always does — that one is set by statute rather than indexed.

A mid-year change is unusual and it is the sort of thing that quietly costs people money. If you are reconstructing a mileage log in April, you will apply one rate to the whole year, and it will either be wrong in your favour or wrong against you. Neither is a good outcome.

Go through the log now, while you still remember which trips happened when. Split it at 1 July. It takes ten minutes in November and it is genuinely difficult in April.

One thing I would not guess at: how the mid-year change interacts with the cents-per-mile valuation rule for personal use of a company vehicle. The logical treatment is to apply each rate to the miles driven in its period, but I could not find IRS guidance saying so directly. If you value an employee's personal vehicle use that way, ask your CPA rather than assuming.

10/01/2026

There is a new box on this year's W-2, and if you run overtime it is your problem before January.

Box 12, code TT: qualified overtime compensation. Mandatory for the 2026 tax year. There is a code TP for cash tips as well, and a new box for the Treasury tipped occupation code.

Here is the part that matters for a trades payroll. Code TT does not report the overtime cheque. It reports the premium portion — the amount above the regular rate under the Fair Labor Standards Act. The half, in time-and-a-half.

Which means your payroll system has to separate it. If it is currently posting overtime into gross wages as one figure, that number does not exist anywhere in your file. Nobody can extract it later, because the information was never captured.

Construction payrolls are overtime-heavy in a way most industries are not. This lands on you harder than on almost anyone else.

The fix is a payroll configuration change, and it is a small one in November. In January it becomes reconstructing a year of pay runs by hand, job by job, week by week, to work out which hours were premium.

Worth a call to whoever runs your payroll this week. The question is simply: are we isolating the FLSA overtime premium, and will it land in Box 12 code TT.

Four filings land on the same day this coming February, and most small employers do not see it coming until the week bef...
09/30/2026

Four filings land on the same day this coming February, and most small employers do not see it coming until the week before.

1 February 2027: W-2s to employees and to SSA. 1099-NECs to recipients and to the IRS. Form 941 for Q4 2026. Form 940 for FUTA.

All four. One day. That is because 31 January 2027 is a Sunday, so the statutory deadline shifts to the Monday.

If every deposit was made on time and in full, 941 and 940 move out to 10 February. That is the only relief in the list.

Two things worth doing in November rather than January.

First, count your information returns. The electronic filing mandate kicks in at ten or more, and it is an aggregate across form types — W-2s plus 1099-NECs plus 1098s, added together. Most contractors with a handful of staff and a handful of subs are over the line without realising it.

Second, if you are going to e-file and you do not already have a Transmitter Control Code, apply now. It can take up to 45 days to issue. In January that is a problem you cannot solve.

Q4 estimated tax is separate and earlier — 15 January 2027.

Before you book the Christmas party, there is a number attached to it.$150 per person, including tax...
09/29/2026

Before you book the Christmas party, there is a number attached to it.

$150 per person, including taxes, for an in-person employer-paid social event. Stay at or under that and it is not a taxable benefit to anyone who came.

Six events a year is the maximum CRA will treat this way, counting in-person and virtual together.

Here is the part that costs people money: go over $150 and the entire amount becomes taxable. Not the excess. All of it. And once it is taxable you also have to include the spouses and partners who attended.

So a party that lands at $160 a head is not $10 of taxable benefit. It is $160, times everyone in the room.

Three things do not count toward the $150, which gives you more room than most people realise — the ride home, taxi fare, and overnight accommodation. You can pay for the cab without touching the limit.

Virtual events run on different numbers: $50 per employee for meals and beverages only, $100 if there is entertainment as well.

One trap at the end. Gift cards handed out at the party are not covered by the party rule at all. They fall under gifts and awards, which means near-cash and taxable unless they meet all three conditions — and unless you kept the log."

09/28/2026

The 2027 EI figures were confirmed on 14 September, so you can budget payroll properly now.

Maximum insurable earnings rise to $70,800, from $68,900.
The employee rate is 1.64 per $100, up from 1.63.
Maximum employee premium: $1,161.12.
Maximum employer premium: $1,625.57.

For every employee who maxes out, your cost goes up $53.27. Theirs goes up $38.05.

One correction worth making, because a few outlets have run it the other way. The EI rate did not stay flat. It went up from 1.63 to 1.64. It is unchanged against 2025, which is how the announcement was worded, and that is where the confusion comes from.

The CPP side of the 2027 picture is not out yet. The earnings ceilings normally land in the first week of November. If someone quotes you a 2027 YMPE today, they are estimating.

There is good news coming on that front, though, and almost nobody has heard it yet. More on that Wednesday."

Two ways to write off equipment, and in a thin year they give completely different answers.Section 1...
09/26/2026



Two ways to write off equipment, and in a thin year they give completely different answers.

Section 179 for 2026: a $2,560,000 limit, phasing out once you place more than $4,090,000 of qualifying property in service. It is elective asset by asset, which gives you control. But it is capped by your business taxable income — it cannot create a loss — and the disallowed amount carries forward.

Bonus depreciation: 100%, and now permanent, for property acquired after 19 January 2025. No dollar cap. No taxable-income limitation. It applies across a whole asset class rather than asset by asset, and there is a 40% election if you want less of it.

The practical difference shows up in a year that did not go to plan.

A contractor with strong income often prefers 179 for the control — pick the assets, leave the rest on a normal schedule. A contractor with a thin year may find 179 largely unusable because there is not enough taxable income to absorb it, while bonus has no such ceiling and will happily push the year into a loss.

Neither helps if the asset is not placed in service by 31 December. Both run on the same deadline.

Which lever fits is a conversation with whoever prepares your return, and it is worth having it in November rather than the following April."

It is nearly gift card season, so here is the rule most employers get wrong.CRA allows $500 a year...
09/24/2026

It is nearly gift card season, so here is the rule most employers get wrong.

CRA allows $500 a year per employee in non-cash gifts and awards, including taxes. Anything above that is a taxable benefit.

The trouble is the word non-cash.

Cash is always taxable — currency, cheques, and reimbursements where the employee picks the item and hands you a receipt. Near-cash is also always taxable, and that includes prepaid open-loop Visa and Mastercard.

A gift card is only non-cash if all three of these are true. The money is already loaded onto it. It can only be used at a single retailer or group of retailers. The terms state the amount cannot be converted to cash.

And then there is a fourth condition that is really the one that catches people: you have to keep a log. Employee name, date, reason, type of card, amount, and retailer.

Without the log, it is near-cash. Near-cash goes on the T4 whatever it cost you.

A few things sit outside the $500 entirely — coffee and tea, T-shirts and mugs carrying your logo, plaques and trophies. And there is a separate $500 long-service award, non-cash, available once every five years.

Worth sorting before the last pay run rather than in February."

09/24/2026

Everyone's talking about AI 🤖 Here's what we ACTUALLY use it for 👇

✅ Taking the repetitive stuff off your plate
✅ A faster month\-end and clearer numbers
✅ Practical tools, not hype
✅ More time back, better results

AI does the busywork. Our experts make the calls.

Comment "AI" and we'll send you a starting point 💬

Your profit and loss statement tells you whether your business is actually making money, but only if you know how to rea...
09/21/2026

Your profit and loss statement tells you whether your business is actually making money, but only if you know how to read it.

Here’s a simple top-to-bottom breakdown:

Revenue
This is the money earned from customers during the period. If your books are on accrual accounting, it may include invoices you sent but have not been paid for yet.

Direct Costs
Also called cost of goods sold, these are costs directly tied to doing the work, such as materials, subcontractors, and job labour.

Gross Profit
Revenue minus direct costs equals gross profit.

Gross Margin
Divide gross profit by revenue to get your gross margin.

Example: If you sell $500,000 and keep $175,000 after direct costs, your gross margin is 35%.

Watch this number every month. If it drops, check your pricing, job costs, and project profitability first.

Operating Expenses
This is your overhead: rent, office wages, insurance, software, vehicles, and other costs you pay whether you are busy or not.

Operating Profit
This is what remains after operating expenses.

Net Profit
After interest and other items, you reach your bottom line.

One important reminder: profit is not the same as cash in the bank. Loan payments, equipment purchases, and unpaid invoices can make profit and cash look very different.

Every month, ask yourself:

• Is revenue growing?

• Is my margin holding?

• Is overhead creeping up?

If you cannot answer these questions, or you do not trust your numbers, it may be time to clean up your books and financial reports.

Book a call at lckconsulting.org.

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162 Pineset Place Ne
Calgary, AB
T1Y2Y1

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+14057773463

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