![\"photo](\"http:\/\/www.jewishindependent.ca\/wp-content\/uploads\/2014\/10\/oct-24-FinLaw.24.Startups-Eli-Joseph.jpg\")
<\/a>Eli Joseph, a senior account manager, business and personal, with RBC, is often surprised at how few people know about government funding options.<\/p>\n
Joseph works with businesses on day-to-day banking, as well as lending solutions through the Canada Small Business Financing Loan (CSBFL) or the Business Development Bank of Canada.<\/p>\n
Clients who fall in the \u201csmall business\u201d category typically have gross sales under $2 million, with fewer than 15 employees, and who need loans up to $250,000.<\/p>\n
\u201cNinety-eight percent fall under this category,\u201d he said.<\/p>\n
The CSBFL has very specific applications, however, such as investing in new equipment or trucks, buying furniture or expanding a business. It won\u2019t cover the cost of hiring staff, a franchise fee or planning a marketing campaign. For that, Joseph suggests looking at a line of credit.<\/p>\n
But even before signing up for some fresh cash, Joseph cautions business owners to take stock of where they are.<\/p>\n
\u201cNinety percent start their business asking for money,\u201d said Joseph. \u201cI try to slow down the conversation, I ask, \u2018Do we have a business here?\u2019 There were three examples where we had to slow it down and go through the numbers; in all three, after doing footwork, they realized they didn\u2019t have a valid business.<\/p>\n
\u201cThat\u2019s where people jump the gun \u2013 they haven\u2019t done the research; and they don\u2019t have a business plan.\u201d<\/p>\n
Tax planner Alexei Schwartzman also underlines how important it is to get professional advice before heading too far into the business.<\/p>\n
\u201cIt is important to involve someone who understands the tax implication of the business, but it\u2019s essential to get someone involved before the business is officially running,\u201d he said. \u201cOften people do not think of asking the questions until they are already operational and, by that point, it might be too late for certain things.\u201d<\/p>\n
This is particularly important if your business has an innovative component that might be eligible for tax credits through the Scientific Research and Experimental Development Tax Incentive Program (also known as SR&ED). Businesses wanting to take advantage of this government credit need to incorporate before incurring research and development costs. A good tax consultant can help determine if the cost of incorporation and filing SR&ED tax returns, which can be substantial, will be worth the actual money saved.<\/p>\n
Also be sure to look at the Public Works and Government Services Canada\u2019s Build in Canada Innovation Program (buyandsell.gc.ca<\/a>), as well as the National Research Council Canada\u2019s Industrial Research Assistance Program (nrc-cnrc.gc.ca\/eng\/ irap\/index.html<\/a>). Both of these have loans and grants that help kickstart businesses to get their innovative products and services from the lab to the marketplace.<\/p>\n No matter what type of funding you\u2019re looking for, both Schwartzman and Joseph agree that the biggest mistakes business owners make are not having a business plan, not doing proper market research or trying to do everything themselves rather than turning for advice to experts who have already done the legwork.<\/p>\n For general information on government loans\/tax credits for small business, contact Rob McGarry, concierge service, National Research Council Canada, c\/o Small Business BC, 601 West Cordova St., 604-499-2804, robert.mcgarry@nrc-cnrc.gc.ca<\/a>, concierge.portal.gc.ca<\/a>.<\/p>\n Baila Lazarus<\/strong> teaches media communications at Small Business BC. Register for her courses at phase2coaching.com<\/a>.<\/em><\/p>\n Upcoming Events<\/strong><\/p>\n\n
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