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  • U.S. introduces fiduciary rule for advisors and brokers | Small Biz Advisor
    obligated to acknowledge their status and the status of their individual advisers as fiduciaries adds the department Firms and advisers will be required to make prudent investment recommendations without regard to their own interests or the interests of those other than the customer charge only reasonable compensation and make no misrepresentations to their customers regarding recommended investments The new rule comes into effect in 2017 but even then if a client s money isn t earmarked for retirement the advisor doesn t have to obey the fiduciary rule reports CNBC About 4 5 trillion were in 401 k retirement accounts as of Sept 30 plus 2 trillion in other defined contribution plans such as federal employees plans and 7 3 trillion in Individual Retirement Accounts according to the Investment Company Institute an industry group The White House estimates investors lose at least 17 billion annually because of brokers conflicts of interest Regulators say problems often arise when people who are retiring or leaving a company roll over their employer based 401 k account into an individual retirement account A broker they hire to make that shift might persuade them to move their money into a variable annuity or other investment that could be risky or expensive The Consumer Federation of America called the government action a historic win for consumers The financial industry though warns that the new requirements for brokers will likely reduce investors choices of financial products and could cause brokers to abandon retirement savers with smaller accounts Perez said that in drafting the final rules his department considered many of the industry s concerns and made revisions to accommodate them The period for the rules to begin taking effect for example was extended from eight months as originally proposed to one year At ground level the new

    Original URL path: http://www.smallbizadvisor.ca/your-business/u-s-introduces-fiduciary-rule-for-advisors-and-brokers-4279?Print (2016-04-26)
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  • How to choose the right business software | Small Biz Advisor
    for your organization Here are her top tips 1 Know your needs The first thing is to get really clear on your requirements Hayes says Create a prioritized list of must haves and nice to haves and use these requirements to evaluate potential vendors in an organized manner 2 Know your deal breakers For one customer it was the fact they needed their data to reside in Canada Hayes says not an easy requirement to meet but one that made it simple to narrow down the vendor list 3 Have a process Once you ve got a short list of tools it s time for demos But provide salespeople with guidelines she says We ll give vendors a script so they demo the same features in the same order and aren t wasting time on features we don t care about 4 Negotiate Vendors are typically pretty flexible on their pricing Hayes says You don t have to feel like the sticker price is the sticker price Cost structures and licensing models can be convoluted so be aware of what s included and what is priced as an add on or per transaction fee and know what the implementation costs

    Original URL path: http://www.smallbizadvisor.ca/your-business/how-to-choose-the-right-business-software-4275?Print (2016-04-26)
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  • Budget could sting biz owners, zap advisor AUM | Small Biz Advisor
    of raw materials from nature and include agriculture forestry the fishing and hunting sector and the mining quarrying and oil and gas extraction sector So if your client is a farmer with one employee he gets the lower rate If she s a lawyer with four employees she also gets it But if he s a doctor with one employee no dice Kraft notes some estimates suggest the federal government stands to gain 500 million in tax revenue if it adopts the Quebec model nationwide The original intent of the SBD says Kraft was to allow businesspeople to pay less tax and reinvest in their businesses The goal was to help energize small business which accounts for an important part of our economy But some professionals are currently using the deduction in a way that amounts to an investment portfolio subsidy When you don t have many employees and you accumulate vast sums of money should that be government sponsored Also on the corporate front Kraft wonders if the Liberals will nix or stall the Conservatives phased corporate tax rate cuts from 11 to 9 by 2019 It s easier to deny something that s going to come in the future than to change something that s already in place Income splitting CCPCs The tax community is also watching for a possible rule change that would prevent clients from using their Canadian Controlled Private Corporations CCPCs as income splitting tools The concern revolves around shareholders who are not active in the company says Lynne Zulian partner Tax Services at Grant Thornton LLP in Barrie Ont If you pay an inflated salary to somebody that s subject to scrutiny CRA can come back and say that s an unreasonable salary But if somebody s a shareholder there isn t the same reasonability test For example say your client incorporated his or her business on day one and the spouse got the same number of shares But perhaps the spouse doesn t work outside the home Dividends out of the company can be paid to anybody who s a shareholder So rather than the first spouse who s active in the business taking high rate dividends to keep the family going they can split it between the two spouses and everybody gets marginal tax rates Zulian says it s possible the government may restrict who can be shareholders Active or passive income Tax practitioners are hoping Budget 2016 brings some much needed clarity to the rules surrounding income generated from property such as rental units storage units and camp grounds With few exceptions this income is considered passive It doesn t therefore qualify for the favourable tax rate active business income gets However if your client has an income generating property business that has more than five full time employees throughout the year he or she will qualify for the active income tax rate Sounds like a simple rule though in practice it s been anything but If Americans can debate what

    Original URL path: http://www.smallbizadvisor.ca/your-business/budget-could-sting-biz-owners-zap-advisor-aum-4223 (2016-04-26)
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  • In difficult times, checking in a good idea | Small Biz Advisor
    approach involves more listening than talking It doesn t have to be about emotions if you re not inclined that way she says Just pick up the phone more regularly and let them know you re out there and willing to help I give clients in these situations a call every few weeks to see if they need extra advice or support This may also be a good time she says to let clients know that you can put them in touch with people who may be able to offer extra help such as HR or taxation experts Nizamuddin says owners facing hard choices may worry that it s necessary to eliminate their group benefit plans to save money This can be a difficult conversation since owners generally don t feel good about removing something they ve offered their employees Nizamuddin s advice is to reassure clients that they may be able to save enough money simply by modifying the plan rather than cutting it entirely For example one strategy is to switch to a health spending account This way you can have an exact budget and stay within it she says Another strategy is to make small changes within

    Original URL path: http://www.smallbizadvisor.ca/your-business/in-difficult-times-checking-in-a-good-idea-4221 (2016-04-26)
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  • Remind U.S. clients about tax changes | Small Biz Advisor
    the ACA now is the time to make sure you have the information you need says Keith Hall president and CEO of the National Association for the Self Employed And don t forget to be creative If you have a kid at home under age 18 who helps in your business create a job and you can save over 2 400 in taxes for money that you are already giving

    Original URL path: http://www.smallbizadvisor.ca/your-business/remind-u-s-clients-about-tax-changes-4213 (2016-04-26)
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  • Five ways to reduce risk of fraud | Small Biz Advisor
    before they re slated for destruction When it s time to dispose of sensitive material documents should be securely shredded Phishing scams Risk Identity thieves and fraudsters often capitalize on tax season by impersonating government agencies such as the Canadian Revenue Agency CRA or banks to request private account information or credentials These fraudulent communications are designed to look legitimate and may insist that this information is needed for the organization to receive a refund or to avoid serious penalties They may also urge the employee to visit a fake site where they are then asked to verify their identity by entering confidential information2 Solution Legitimate organizations like a bank or a government authority will not expect you to send personal information by an email or online3 Businesses should be vigilant when they received a fraudulent communication that claims to be from the CRA or any financial institution requesting private information Account or credential information should never be entered into a link from an email even if the site appears like a credible source s website It is always a best practice to navigate to a secure site from your bookmarks or by typing in the website directly Unsecure documents Risk As employees prepare the necessary information to complete a tax filing confidential documents are often pulled from various location and digital copies are frequently printed to be used as backup material This can result in loose paperwork being stored on desktops or left at printing stations leaving the sensitive data vulnerable to snooping and data theft and available to outside staff such as cleaners and building maintenance Solution Instituting a clear desk policy and having lockable storage units for employees can help protect confidential information not only during tax season but throughout the year Requiring employees to use a

    Original URL path: http://www.smallbizadvisor.ca/your-business/five-ways-to-reduce-risk-of-fraud-4210 (2016-04-26)
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  • How to communicate with clients during bad markets | Small Biz Advisor
    very important To do this focus on a client s goals and the progress he s making to achieve those goals instead of his rate of return This way your client will be less emotionally sensitive to the volatility of the markets We recently spoke with a retired couple who was concerned the recent downturn in markets meant they had lost a lot of money Our first step in responding to their concerns was to focus on their long term retirement projections Based on a quick review we were able to show them that the recent downturn had very little effect on their ability to achieve their goals The clients left our office feeling reassured and didn t make any rash decisions with their portfolio 2 Be cautious with portfolios We tend to err on the side of caution with all our portfolios We go through an in depth discussion with new clients to get a good appreciation for their ability to handle risk and volatility Then we ll design a portfolio with the minimum amount of risk possible that will still allow them to achieve their goals and meet their expectations For example in 2015 we ve been allocating an equal weighting to international equities and Canadian equities This helped diversify our clients portfolios and protect their capital last year 3 Communicate with clients The best thing you can do is be proactive with your communication during periods of poor market performance Be consistent but you don t have to be frequent in your communication If you re emailing your clients every day about what went on in the market you ll send the wrong message and may even scare them In January we sent out one communication to talk about the volatility in markets and how we were

    Original URL path: http://www.smallbizadvisor.ca/your-business/how-to-communicate-with-clients-during-bad-markets-4208 (2016-04-26)
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  • What millennial consumers think of themselves | Small Biz Advisor
    spoiled 48 Other characteristics millennials believe they personally possess are hardworking ambitious 60 and responsible 57 while fewer see their peers as hardworking ambitious 45 or responsible 19 In a report Mintel notes the popularity of social media trends like selfies and sharing experiences online may be contributing to an environment where millennials feel pitted against each other And in an era where people constantly see posts of only the best experiences of their peers a sense of competition among the generation is fostered and contradictory perceptions between themselves and peers form says Carol Wong Li senior lifestyles and leisure analyst at Mintel Millennials positive descriptions of themselves are not unfounded however According to the survey 62 of millennials are primarily responsible for their living expenses and 23 share living expenses with someone else others The majority of millennials are living independently 39 live with their own nuclear family spouse and or children and 21 live alone One quarter 25 of millennials still live with their parents driven primarily by 18 24 year olds 37 There is this stereotype that millennials are kind of lazy and not hardworking but the fact that they re growing up they are embracing responsibilities and their values align to those of the boomers being hardworking and family oriented says Wong Li Millennials independence doesn t come without financial stress nearly half 48 of those surveyed feel constantly stressed about their money well above the average consumer 36 Additionally 56 say saving even a little bit of money each month is difficult However recent economic conditions have demonstrated the importance of saving for retirement for 70 of millennials When it comes to shopping the top characteristics millennials look for when buying products are quality 65 and affordability 58 indicating they place value on both long

    Original URL path: http://www.smallbizadvisor.ca/your-business/what-millennial-consumers-think-of-htemselves-4201 (2016-04-26)
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