Small Business Budget Breaks
The new Canadian budget has measures that will reduce red tape and give $1000 tax credits to small business in order to offset Employment Insurance (EI) premiums. This is hiring credit that will applied against any increase in EI premiums paid in 2011. Only companies who paid less than $10,000 in EI premiums in 2010 qualify for the credit, so it is targeted at the smallest of the small.
It is estimated that about 525,000 businesses would be eligible for the credit, saving them a combined $165 million in 2011. The small business federation was also seeking to shelter companies from legal or tax consequences of following incorrect advice from the Canada Revenue Agency (CRA), and they say that provisions in the budget represent a step in that direction. This is an important issue, as a recent survey found that more than 20% of the time, advice given out over the phone by the CRA was either incomplete or incorrect.