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Government took all my Adsense earnings
Dantol



 
Msg#: 8825 posted 3:06 am on Aug 23, 2005 (gmt 0)

Dear friends,
I haven't been on this forum for quite some time.
Since I started my website, some 4 months ago, I earned close to $2000 (including July 2005 earnings). Now, I got the tax bill for 2004 from Canadian Government with close to $2000 in balance owing.

All the money that I earned from Adsense will now go to the pockets of this bloodthirsty Canadian government.

I am extremely dissapointed for losing everything that I earned with Adsense. All my earnings will be gone.

I am very dissapointed. So why I am telling you all this? Because I will feel better once I tell you that I was robbed by heavily taxed bloodthirsty government.

Any comments are appreciated. I wish you all good luck with your Adsense earnings. I will keep fighting and trying until I become wealthy.

I believe that Adsense has tremendous potential and I am working hard to increase my earnings.

How are your earnings doing for August?

 

Frequent

5+ Year Member



 
Msg#: 8825 posted 3:13 am on Aug 23, 2005 (gmt 0)

Look on the bright side. Without adsense you'd have to come up with those taxes elsewhere.

Good Luck!

Freq---

2oddSox

10+ Year Member



 
Msg#: 8825 posted 3:15 am on Aug 23, 2005 (gmt 0)

As they say, there's only two things in life that are certain - Taxes and Death.

You've now been taxed.

Dantol



 
Msg#: 8825 posted 3:26 am on Aug 23, 2005 (gmt 0)

Thank you Adsensers, you positive comments already made me feel better.

How are your August earnings doing?

SilverSiR

5+ Year Member



 
Msg#: 8825 posted 3:28 am on Aug 23, 2005 (gmt 0)

How did they find out, did you claim your Google income?

Gargen

5+ Year Member



 
Msg#: 8825 posted 3:33 am on Aug 23, 2005 (gmt 0)

Google has to claim it you submit a tax form, but its not like you were paying 100% taxes on it thats all the tax so you would have had to pay it any way

buckworks

WebmasterWorld Administrator buckworks us a WebmasterWorld Top Contributor of All Time 10+ Year Member



 
Msg#: 8825 posted 4:09 am on Aug 23, 2005 (gmt 0)

Be sure you keep good records to document all the costs you incurred to earn the Adsense income, so you don't miss any legitimate deductions. Hosting, domain registrations, advertising, computer equipment and software, office expenses, relevant books and subscriptions, etc. etc can be claimed against your website's income, as long as the expenses are adequately documented. Get some advice from an accountant who has experience with fledgling home businesses.

----------

I just spent three weeks travelling in a country where there is no old age security other than what one's family can provide, no health care except what one's family can pay for, and the water from the taps is not safe to drink. Try it sometime ... such a trip will give you a new perspective on what your tax dollars accomplish.

spaceylacie

WebmasterWorld Senior Member 5+ Year Member



 
Msg#: 8825 posted 4:25 am on Aug 23, 2005 (gmt 0)

In Canada, you can claim expenses, correct? So, put your money back into the business if you don't want to give it all away. I'm going on a shopping spree tomorrow to purchase everything I need for a new site I will be starting.

Have fun putting the money back into your business and keep good records. Attend the next WebmasterWorld conference and claim your travel expenses. That's better than giving it away to the government, isn't it?

Yes, do pay your share(plus some if you want to), but... by all means, invest your money toward your future with the Internet.

morpheus83

10+ Year Member



 
Msg#: 8825 posted 4:35 am on Aug 23, 2005 (gmt 0)

I guess Canada has the highest tax rates in the world!

jenkers

10+ Year Member



 
Msg#: 8825 posted 4:41 am on Aug 23, 2005 (gmt 0)

Dantol - you need to hire an accountant. What's the level of tax over there in Canada? Either something is seriously wrong or that tax bill is not just for your adsense earnings...

Just reread your post - I guess taxes are filed differently over there. Well, at least you had the Adsense earnings to cover your taxes.

webnoob

5+ Year Member



 
Msg#: 8825 posted 4:53 am on Aug 23, 2005 (gmt 0)

well, the canadian government must get something in return.. after all they provide you with free medicare.. there is a down-side to everything..

BlackRaven

10+ Year Member



 
Msg#: 8825 posted 5:48 am on Aug 23, 2005 (gmt 0)

Dantol did you accept payment by direct deposit? or cheque?

Lex_Luther

5+ Year Member



 
Msg#: 8825 posted 8:47 am on Aug 23, 2005 (gmt 0)

Sneak over the border to the free state, New Hampshire, live as an illegal alien while you set up an second identity, easy, and screw both governments.

dave741

10+ Year Member



 
Msg#: 8825 posted 9:09 am on Aug 23, 2005 (gmt 0)

Dantol, exuse me but I do not think there is 100% taxes in Canada.

OK, your AdSense income is 2000, you paid 2000 tax. But what is included in 2000 tax? Adsense only? Or more of your activities?

irock

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 8825 posted 10:26 am on Aug 23, 2005 (gmt 0)

webnoob,

I have to pay $150 per quarter to get my 'free' medicare.

I can ensure you that the medicare system in Canada is close to collapse. The financial burden to the CAN government is close to unbearable. The authority will need more tax to cover the expense, and most people will leave Canada.

But I think Dantol probably has made a mistake with his personal tax filing, b/c people with less than $8000 annual income don't have to pay tax. The only exception is that if you have other incomes.

You should really contact your accountant immediately.

If you believe the site will gradually generate more income, start a sole prop and write off expense like PCs, salary, Internet expense...

OptiRex



 
Msg#: 8825 posted 10:34 am on Aug 23, 2005 (gmt 0)

I just spent three weeks travelling in a country where there is no old age security other than what one's family can provide, no health care except what one's family can pay for, and the water from the taps is not safe to drink. Try it sometime ... such a trip will give you a new perspective on what your tax dollars accomplish.

So, did you like the United Kingdom?

I jest not...!

webnoob

5+ Year Member



 
Msg#: 8825 posted 10:34 am on Aug 23, 2005 (gmt 0)

well i find it funny that you just started adsense and you already received the tax claim for it? dunno about canada but here in the states you get the tax claims a year after your earnings...

lammert

WebmasterWorld Senior Member lammert us a WebmasterWorld Top Contributor of All Time 5+ Year Member



 
Msg#: 8825 posted 11:08 am on Aug 23, 2005 (gmt 0)

For all those who didn't read the original post:

Now, I got the tax bill for 2004

Dantol is venting his anger because his current earnings all flowed to the government, but as he only started his website 4 months ago, there is no relation between the tax and the AdSense earnings.

Dantol, to answer your question:
My August earnings are great, and this will probably be my best month ever.

foxtunes

10+ Year Member



 
Msg#: 8825 posted 11:26 am on Aug 23, 2005 (gmt 0)

So, did you like the United Kingdom?

I jest not...!

Ha nice one optirex.

I hear people saying write off the costs of computer equipment against your taxes. Here in the uk the inland revenue would only allow me to put my computer down as a capital allowance....Can you believe that? A computer is essential for me to run my business, if I don't have a PC they don't make take their 40 percent from me....But no I can only claim 40 percent off the price of the PC off my taxes for the first year.....Also you can not write off the cost of business lunches/entertainment expenses with clients.

On the other side I have a friend in Switzerland, he claims back almost everything, the tax system is so liberal there.

OptiRex



 
Msg#: 8825 posted 12:01 pm on Aug 23, 2005 (gmt 0)

foxtunes

But no I can only claim 40 percent off the price of the PC off my taxes for the first year

It's now 50% or 40%, depending on whether the business is classed as small interprise (50%) or medium enterprise (40%) however if you lease it you get 100% tax allowance!

I believe repairs are 100% allowable therefore it can make sense to upgrade rather than buy new!

Also you can not write off the cost of business lunches/entertainment expenses with clients.

The Hooray Henrys put paid to that one and now the rest of us have to suffer for their extravagance!

Expenditure on entertaining is not allowable for corporation tax relief and no VAT input claims can be made however try claiming for it as a subsistence allowance...unless it's a massive bill for you and your mates at a local restaurant!

I do a lot of travelling and my local tax office have no qualms about me entering it as a necessary business expense and even more so when I am outside of the UK however I don't take the p!$$.

itloc

10+ Year Member



 
Msg#: 8825 posted 12:23 pm on Aug 23, 2005 (gmt 0)

foxtunes:

I am in switzerland. And believe me - I am looking for ways to get out. Liberal taxes here? No way. Only for foreigners which decide to reside here. They can make a tax deal...

Perfect for Phil Collins, Tina Turner or Michael Schumacher - but not for the small webmaster...

Sometimes I do get the impression I do work only for the federal tax offices.

itloc

Wonderstuff

5+ Year Member



 
Msg#: 8825 posted 12:47 pm on Aug 23, 2005 (gmt 0)

So if an accountant is the answer to effective tax advice, how much would you expect to pay for one in the UK, and what should you ask him or her to do for their corn?

Roadkill

10+ Year Member



 
Msg#: 8825 posted 12:49 pm on Aug 23, 2005 (gmt 0)

I dont know how things are set up in Canada. But this is a good time for everyone to pay attention to what they are doing in regards to taxes.

In the US if your buisness is a sole proprietor it will end up costing you 30% because of self employment tax and such. If you are a Corp. (S) type its a flat 15%.

Keep all records and right off all exspences and pay attention to where your are (tax liability wise) throughout the year. You do not want to be in December and panicing because you just found out you have a large liability.

Good luck

Dayo_UK

10+ Year Member



 
Msg#: 8825 posted 12:54 pm on Aug 23, 2005 (gmt 0)

Roadkill

Similar situation in the UK. (Although different rates obv)

Wonderstuff

Couple of Hundred Quid for yearly returns (Maybe bit more.) Depends on how complicated your accounts are :)

abbeyvet

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 8825 posted 1:21 pm on Aug 23, 2005 (gmt 0)

Government took all my Adsense earnings

Seems to me this should read "Google paid last year's tax for me!"

OptiRex



 
Msg#: 8825 posted 1:23 pm on Aug 23, 2005 (gmt 0)

how much would you expect to pay for one in the UK

Believe it or not the cheapest method, i.e. free, is to let the taxman do it! I sit down with them every year face to face and go through everything with them and quite often they are aware of stuff that accountants are not up-to-date with.

Since I took control of presenting my own accounts many years ago, instead of paying 4k per annum to an accountant, my tax bill has been negligible.

Always insist upon the accountants being ratified through the local tax commissioners so that they cannot turn around in a few years time claiming they "made a mistake"!

Mods: Please allow this link since it is a useful UK government tax assistance helpline:

[direct.gov.uk...]

Wonderstuff

5+ Year Member



 
Msg#: 8825 posted 3:22 pm on Aug 23, 2005 (gmt 0)

Many thanks Dayo_Uk and OptiRex for your sound advice.

James

5+ Year Member



 
Msg#: 8825 posted 3:38 pm on Aug 23, 2005 (gmt 0)

Dantol

The $2000 you mention has nothing to do with Google, as far I understand it, it relates to income made prior to adsense. Again from what I can see, all you are doing is paying a tax bill using money made with adsense....Better than getting the same bill and not having adsense!

Somebody mentioned Michael Schumacher. Michael Schumacher is a resident of Monaco, although he has a villa in Switzerland. His tax is based around the rules in Monaco rather than Switzerland.

EricGiguere

5+ Year Member



 
Msg#: 8825 posted 3:54 pm on Aug 23, 2005 (gmt 0)

Talk about a bogus thread. The original poster should be happy that he made $2000 with AdSense to pay off that $2000 tax bill he incurred doing something with no relation to AdSense.

Canada, like most countries, requires you to report income earned from any source. Google does not deduct anything from the money it sends to Canadian residents, but the publisher must of course declare that money in its entirety to the government on the next tax return and pay the appropriate taxes. This is no different than anything else. Just don't forget to deduct your legitimate income-related expenses, like your hosting fees. It's up to you to put money aside to pay the tax bill when it arrives next year.

Eric

creepychris

10+ Year Member



 
Msg#: 8825 posted 4:22 pm on Aug 23, 2005 (gmt 0)

Dantol,

This was really a misleading post on your part. I am also Canadian and I claimed my Adsense earnings (I have been with it since the beginning). For other Canadian webmasters doing your taxes next year. It is not only the income tax that you have to pay but you will also have to put into the pension plan as well. And since you are self-employed you have to put the full amount required by law (as opposed to employed people who get half put in by their employers). Make sure you put away a little something to cover these expenses.

Things I wrote off:
My computer (but like the UK case, I only got a % this year since it was a 'capital investment'. All software I purchased (except for games!). A portion all my electricity, heating, and water. Gas for the car. The car. So, so, so many little things. Interest on the mortgage payments.

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