Eight questions to ask your accountant before starting a business
Source: CPA Canada
Going out on your own is fraught with risk. Get some professional advice before you take the entrepreneurial plunge.
Entrepreneurialism is on the rise, with many so-called “wage slaves” dreaming of breaking free and starting their own businesses. But, before you abandon the security of your nine-to-five, you better be sure you’re ready to take the leap. We talk to two experts—CPAs Eugene Chong and Nicole Heighington—to find out exactly what questions you should be asking your accountant—and yourself.
How should I structure my business?
When you’re starting out, you must choose whether to operate as an unincorporated sole proprietorship, incorporate your business federally with Corporations Canada, or incorporate provincially with the relevant authority. If you have partners, that adds another layer of complexity to consider. A CPA can help you identify the best option and mitigate the risks associated with whatever path you select.
How should I finance my business?
You may choose to dip into your personal savings or hit up family and friends, take on debt or give up part of your equity. There’s no right or wrong way to start a business, but a CPA can help you work through the pros and cons of each option. With the tightening of Canadian mortgage rules in 2018, Chong notes that some entrepreneurs “may have to lean toward private lenders or the ‘Bank of Mom and Dad.’”