HALIFAX – If you operate a home-based business, chances are you are paying too much tax. That’s what Halifax’s Doug Collins, a long-time entrepreneur, has learned over the years. He firmly believes not enough business owners understand the tax system and what can be written off come tax season.

That’s why in 2020, while bored and restless during the pandemic, Collins wrote a 100-page book called “The Home-Based Business Guide To Write-Off Almost Anything!” The book was released in August of 2020 and, over the past year, has been listed as a #1 seller on Amazon in the international tax category. It has also reached #1 in the small business taxes category.

“I’m not an accountant, I don’t have a tax background, per se,” says Collins. “I’ve just been in the trenches doing it for decades and I’ve learned it.”

“That’s why it resonates so well with home-based businesses.”

Collins, who operates an at-home online marketing business, has been in the one tax trench no one wants to be in; he was once audited by the CRA. And the audit didn’t go his way, to say the least.

At the end of the audit, the CRA insisted he owed $15,000 in unpaid tax. The CRA disagreed with some of the items Collins wrote off in his initial tax filings. But Collins decided to fight the CRA’s findings.

He wrote two objection letters, which CRA both rejected. Still, he planned to fight a third time.

“So, in the meantime, penalties and interest are accumulating,” recalls Collins.

In preparing for his third objection, he approached a man who used to work for the CRA to help him with his tax fight. The only issue was, the guy wanted a $2,000 retainer for his services. So, Collins decided to go it alone.

“It looked like I was going to court; it looked like I wrote an affidavit,” recalls Collins. “It was three or four inches thick; I put it in a box and I shipped it off to Revenue Canada.”

“I was fighting it on principle.”

More than half a year later, the CRA gave in and reversed their previous decision. In total, Collins’ battle with the CRA lasted well over a year.

It’s this kind of experience that gives Collins confidence in giving other home-based business owners tax advice.

He firmly believes there are not enough home-based business tax experts out there. He even has a chapter boldly titled, “Your Tax Preparer Is Giving You Bad Advice.”

“There’s not a lot of tax preparers who are focused on the home-based business,” says Collins.

“And most books like that have been written by tax people who probably aren’t in a home-based business.”

One of the biggest pieces of advice Collins gives out is simple but effective: every home-based business owner should have an office in their home.

“It’s that piece of real estate in your home that you assign as a business,” says Collins. “It’s not setting up your office at the kitchen table – it’s assigning a room and saying, ‘that’s my office.’”

“My office almost represents 20 percent of my house.”

By assigning an office in your home, says Collins, you can write off a portion of household expenses. Since Collins’ office takes up 20 percent of his home, he can claim 20 percent of utilities at tax time, for example.

Collins says too many home businesses fail to do this simple, money-saving task because they don’t see the benefit in a home office.

He even tries to convince contracted delivery drivers from places like Uber to set up an office to do their paperwork so they can write off some expenses.

“I meet the (delivery) guy at the door and talk to him about it and give him a book; that’s his tip because they own a home-based business,” says Collins.

“They only look at their vehicle as the business, so they only keep expenses around the vehicle. What I’m saying is, you got to have a home office.”

Another problem with a lot of home business owners (and a lot of taxpayers in general) is lack of organization. Too many people don’t file away their receipts properly or keep tax information organized throughout the year.

“What I do is teach them to be organized on a monthly basis, know where they’re at on our expenses and, when tax season comes, you’re organized – there’s no work,” says Collins.

The success of Collins’ book has created a large community, which he regularly keeps in touch with. Collins runs the Facebook group “Home Business Tax Secrets.”

Every day, through this online community, Collins gets feedback on the book and a lot of praise from business owners who are grateful for learning about tax benefits. For the author, that’s more important than being ranked #1.

“It was more of (the impact) than saying I’m number 1 because that’s short-lived. You can be number 1 for a day and then not,” he says.

* This was a Feature story published on Sep 17, 2021 by Derek Montague of Huddle.Today. Click here for the original story.