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Business/Taxes setup for Affiliate Marketer in Canada (13)

08-20-2018 01:52 AM #1 smoochy (Member)
Business/Taxes setup for Affiliate Marketer in Canada

Hello STMers!

Does anyone have any resources or advice on setting up your business/tax for AM work in Canada to protect my own ass so to speak. Things are ramping up with native and pop traffic and obviously at some point goverment is gonna want some of it too. If somebody can share some of their setup or any suggestions would be much appreciated. Right now everything is done via personal account, so obviously that's probably not the best way to go about this.

Thanks in advance!

08-22-2018 05:47 PM #2 smoochy (Member)

Shameless bump

08-22-2018 05:50 PM #3 manu_adefy (Veteran Member)

Should be some Canadians around honestly...

Canada has different taxes per province, right? Might help if you also add that info.

And... As always with these things, you should also talk to a professional before you do anything, and only use the advice here to point you in the best direction.

08-22-2018 07:10 PM #4 smoochy (Member)

Yeah some direction to at least get me started is what I am looking for and perhaps some contacts. Due to the nature of the traffic (POP), I am not necesarily looking to setup a business in Canada, just trying to see what other people are doing who are from Canada. Perhaps an offshore corp situation or anything else. It is very hard to find good information as applcable to Affiliate Marketers when it comes to taxation and banking.

08-27-2018 06:04 AM #5 Digitas (Moderator)

Quote Originally Posted by smoochy View Post
Hello STMers!

Does anyone have any resources or advice on setting up your business/tax for AM work in Canada to protect my own ass so to speak. Things are ramping up with native and pop traffic and obviously at some point goverment is gonna want some of it too. If somebody can share some of their setup or any suggestions would be much appreciated. Right now everything is done via personal account, so obviously that's probably not the best way to go about this.

Thanks in advance!
If you are not looking to operate in Canada itself then you can always incorporate a Provincial level entity. Each province has different rules in terms of resident directors etc. If you can let me know the province you intend to open I can let you know the details around that.

Moreover you can always look for an offshore incorporation for a more tax free structure. You can consider registering a company in Hong Kong or a freezone entity setup in Dubai.

08-27-2018 12:47 PM #6 iAmAttila (Veteran Member)

i recommend opening a US company and running through that so you can collect travel miles...

08-27-2018 06:39 PM #7 smoochy (Member)

I've been slowly getting my head wrapped around this whole process, and you are right it does look like in Canada for US business chequing accounts and US Visa Credit Card, there isn't much options in terms of rewards.
I am at the point where I bring in a consistent profit with POP traffic, but really unsure on what the best course of action is for me in terms of limiting liability and paying less tax.

08-27-2018 09:46 PM #8 cmdeal (Veteran Member)

Quote Originally Posted by smoochy View Post
I've been slowly getting my head wrapped around this whole process, and you are right it does look like in Canada for US business chequing accounts and US Visa Credit Card, there isn't much options in terms of rewards.
I am at the point where I bring in a consistent profit with POP traffic, but really unsure on what the best course of action is for me in terms of limiting liability and paying less tax.
Roughly what amount of profit are you talking about? There is a point where tax planning makes sense, but below that point, the cost and complexity can outweigh any advantages.

08-28-2018 12:20 PM #9 smoochy (Member)

Quote Originally Posted by cmdeal View Post
Roughly what amount of profit are you talking about? There is a point where tax planning makes sense, but below that point, the cost and complexity can outweigh any advantages.
400-700 USD per day

08-28-2018 01:30 PM #10 cmdeal (Veteran Member)

Quote Originally Posted by smoochy View Post
400-700 USD per day
Yeah it probably makes sense for you to look into proper planning.

08-29-2018 01:19 PM #11 Digitas (Moderator)

Quote Originally Posted by smoochy View Post
400-700 USD per day
I agree with cmdeal to consider a proper tax planning here as this could make a material impact on your profit figures that you can cash out.

You may consider an offshore setup in HK. The setup costs are quite cheap.

08-30-2018 02:58 PM #12 xxf8xx (Member)

I'm in Canada. I currently run everything through my personal account but ideally you want to incorporate which only costs like $300 or something like that, at least through my accountant. You also need to be charging every Canadian affiliate network (Mundo, YTZ, Oasis, others I can't think of right now) you work with HST. So if you do 10k in rev with them, you need to invoice them for 10k + HST based on the province you live in. That money sits in an account and you pay it to the government quarterly or yearly.

You will also owe like 30% of all total profits in income tax. Make sure you have proper tracking of all your expenses, even STM is an expense. If you can afford it, hire an accountant full time and just send them everything to take care of it.

The whole collecting HST thing has really screwed me over in the past. I got caught up using it as cash flow and almost couldn't pay it. Don't ever do that.

I am not a CPA or lawyer this is just some advice.

Cheers,
Brad

EDIT: I see people mentioning an offshore account. I know nothing about that and it's probably way more trouble than it's worth for where you are right now. Also mentioned you could open a US account, but then you need to pay US taxes AND Canada taxes which can further complicate things. What I am planning to do is open up a US chequing account and a US credit card through my Canadian bank. You won't earn points of any kind but hey, you won't be paying 2.5% forex fees on every account top up, and that beats any kind of points reward I think.

08-30-2018 06:15 PM #13 smoochy (Member)

Quote Originally Posted by xxf8xx View Post
I'm in Canada. I currently run everything through my personal account but ideally you want to incorporate which only costs like $300 or something like that, at least through my accountant. You also need to be charging every Canadian affiliate network (Mundo, YTZ, Oasis, others I can't think of right now) you work with HST. So if you do 10k in rev with them, you need to invoice them for 10k + HST based on the province you live in. That money sits in an account and you pay it to the government quarterly or yearly.

You will also owe like 30% of all total profits in income tax. Make sure you have proper tracking of all your expenses, even STM is an expense. If you can afford it, hire an accountant full time and just send them everything to take care of it.

The whole collecting HST thing has really screwed me over in the past. I got caught up using it as cash flow and almost couldn't pay it. Don't ever do that.

I am not a CPA or lawyer this is just some advice.

Cheers,
Brad

EDIT: I see people mentioning an offshore account. I know nothing about that and it's probably way more trouble than it's worth for where you are right now. Also mentioned you could open a US account, but then you need to pay US taxes AND Canada taxes which can further complicate things. What I am planning to do is open up a US chequing account and a US credit card through my Canadian bank. You won't earn points of any kind but hey, you won't be paying 2.5% forex fees on every account top up, and that beats any kind of points reward I think.
Oh wow some good information here. This is really helpful and solidifies a lot of the things I have been reading. Is there a particular reason as to why you have not incorporated yet and instead still run everything through your personal account? Or just haven't gotten around to that. And you are abolutely right about the FX exchange vs rewards benefits. Also if Affiliate Networks I run through are not Canadian then I don't have to worry about HST right? I think MaxBounty is the only one I've done some business with and from what I know they are in Ottawa. Not sure about GlobalWideMedia as they do have an office in Victoria but also in bunch of other places. You wouldn't know how this works with them by any chance would you? (I will ask my AM regardless).

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