I first heard about this line years ago from Nick Karadza at the Rock Star Inner Circle member event.
When I was in my early twenties, I thought success means that living in a nice home while driving a Mercedes. I did it to appear successful, at least in my parents’ eyes.
As it turns out, living paycheck by paycheck cannot really be considered “successful”.
Years later, I started my accounting business when my daughter was 10 months old.
My dad asked me how much I made after the first year in business… and I couldn’t respond, I net less than $30K that year. To put it in perspective, at the time, if I were to work for a corporation in the accounting capacity, I would be making around a 6-figure salary.
I was juggling being a new mom, starting a new business and managing my real estate portfolio.
I did weekly blog post and free consultation. I drove to different real estate events to market myself. I had to do follow up with prospective clients and provide quotes. I saw prospective clients in the morning, at night and over the weekend. I saw them in Markham and Oakville, while I lived in Burlington.
Once they decide to work with me, I gather information from clients, prepare the returns, review them 2nd time by myself, ask client questions, collect response, prepare invoices, receive e-transfer, deposit cheques, follow up with accounts receivable.
When I was working for someone else, I spent a lot of time during work hours on personal stuff. I was such a bad employee. Then I started my business, my life turned upside down.
When I finished my book Complete Taxation Guide to Real Estate Investing, I woke up everyday at 5am to put it together. Otherwise, who would have the time to finish putting a book together?
Today, I’m grateful to have a team to work with me… but I still can’t find time to buy a pair of hiking shoes.
Hiring, office management, cash flow forecast, marketing, manage and coach my team…
Today, my definition of success is to be the best version of myself. If I can be better than yesterday, even by a little bit, I consider myself successful.
This may mean, choosing to have a black coffee over my favourite Second Cup Mocha, which contains over 1,000 calories. 😉
This may mean, waking up early to spend a bit more time with my kids.
This may even include paying more taxes. I know, paying more taxes sucks! But the reality is that, you need to make more money to qualify to pay more taxes.
But…not everyone has the same philosophy though.
In a recent court case, two individual taxpayers formed a corporation to purchase a restaurant business.
The restaurant was run on a point-of-sale system (POS), which recorded all the sales. The restaurant accepted cash, Interac and credit card payments.
At the end of the day, the individual taxpayer downloaded all the transactions from the POS and amended them to eliminate all cash sales.
He then delivered the amended record to the accountant for bookkeeping and tax return filing purpose.
They amended 9,715 sales entries to no sales entries in 4 taxation years.
They essentially pocketed ALL cash sales and HST on all these sales.
The corporation is liable to pay back all HST AND the income tax owed on all cash sales.
The two individual shareholders are also liable to pay personal income taxes on all cash sales that they pocketed, plus, gross negligence penalty 50% on the tax payable.
People do go out of their way to make sure they get to keep more money in their pocket – even illegally.
Do get better everyday, legally, not illegally.
Until next time, happy Canadian Real Estate Investing.
Cherry Chan, CPA, CA
Your Real Estate Accountant