This document provides a bird's view of the operational costs of setting up and running a small business in North America, Canada region.

1. 2015
Vijay Mohire
vijaymohire@gmail.com,
skype: vijaymohire
1/1/2015
Operating costs : Small business
Toronto, ON, Canada

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Operating a small business in Toronto, with short trips to US
Minimum base salary: CAD $66,000 per annum
Cost break- up
Employer wages and payroll deductions per month:
1. Salary: CAD $5500
2. Tax+ EI: CAD $1,469.48 - Calculated as per Canadian revenue Calculator
Take home: $4,030.52
Fixed Cost / Expenses:
1. Furnished apartment or Live /Work loft with Internet and utilities: $2500
2. Food expenses: $1000
3. Local travel: Monthly pass: $120
4. US 2 day trip (2 way Bus ticket + One night stay + Food) = $500
Total expenses = $ 4120
Compensatory deviations +- 5%
Out of pocket expenses incurred for business expenses (variable expenses) will be claimed as per
actual. Employer will be informed about the cost prior to incurring the expense. Once approved
employer should settle the bill claimed in next months’ salary or 30 days time frame whichever is
convenient
US – Canada trips
Crossing the border is a daunting task for many. This involves US-VISIT program based Biometric
checks and stamping on passport by Officer. This has replaced I 95 stamping. If I 95 is needed
then an e-copy is obtained from US website.
To avoid lengthy time, leverage NEXUS, CAN PASS AIR. Additional costs: $50 application fee
+ postage + travel charges for interviews as actual
Travel by Bus is cheapest however takes long time to destination. Typically Megabus /
Greyhound can be used
For a trip to NY megabus charges $150-200 for a round trip.
Hi speed trains originate from UNION station, downtown Toronto and travel upto NY City.
AMTRAK is good option which covers most of the US major cities. New York, NY - Penn Station
(NYP), Newark, NJ - Penn Station (NWK) etc

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If time is urgent then Air travel is better. Air Canada has good service with round trip costs of $700.
At Airport one needs to transfer to other local trains like NJ SUBWAY and use a TAXI for commute
from Subway to end client office. So additional costs will be incurred based on actual
Short term accommodation+ Office in US + CANADA + UK + Europe
Agencies like Regus have an excellent network of corporate solutions across the world. Regus
furnished Office and their tie up with Oakwood’s Execustay is great value for money. One night
bachelor stay costs $150/night. Prices are high however if near to work then excellent
Long stay accommodation + Office in US + CANADA + UK + Europe
Based on client location, one needs to decide to stay; if there are DESI people then it will be
cheaper. HI rise furnished apts / lofts are better than basement or single homes; there is security
and better for wireless phones as you go up for business. There are corporate housing agencies
that provide serviced apartments for doing business. As time is prime, better to use a Ready to
Use office + Home.
Typically you get good suites in range $2500-3000/month with Utilities and Wireless with In house
Kitchen, Laundry, and Dryer etc. In UK rates are typically GBP 1000 / month, in EU Euros 1000 /
month
Visas
If there is a need for extended stay or work in the USA, then US H1 B needs to be filed. This year
onwards the costs are about $5,000 for filing and interview. A B1 costs $160 /person
UK Business Visitor visas cost £83 per person + charges for interview and logistics
Schengen Business Visitor visas cost Euros 99 per person + charges for interview and logistics
Forex
All figures mentioned are in their currency format. Salary will be paid in CAD and for client visits
suitable conversion will be applied and the costs will be recovered in CAD.
Conversions: 1 CAD = INR 55 = USD 0.86 = GBP 0.55 = EUR 0.7
Business registration
If you plan to operate systematically it will be more fun. Canada has a great infrastructure;
uninterrupted power supply, easy Govt. policies and nearness to North American market makes it
a great place to start and do business. For a $1000 budget, you can register a corporate which
includes tax and service provider fees. You can add related services like Payroll procession,
Accounts and Book keeping for a small monthly or annual fee with start range from $100 /month
for each type of service.
Typical work and deliverables
Based on visa category (Canadian green card and Business visa to US), being employed for
Technical jobs in Canada and Business in US, several roles can be played- like Technical expert /
advisor, onsite co-coordinator, account manager, client engagement manager. Conducts tasks via

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phone, email, conduct business workshops, Gap analysis, Requirements analysis, visit client for
business deals, and prepare RFP responses. Typical time will be spent in capturing the client pain
points, documenting needs, generating the business value from the company, TCO analysis,
feature benefits of the proposed solutions, Cost analysis, technical, business, competitor analysis,
go-to-market strategy and any techno-commercial-managerial tasks. Follow up on the deal till
hand over to delivery. Provide oversight of project plan, enterprise architecture, end deliverables,
UAT and related onsite tasks. Repeat business leveraging existing clients and new clients. Travel
to client places as needed with short notices of 1-2 days across US, Canada and Europe. Be
ready for extended stay and travel of about 50% time. Provide accurate statements of expenses
and variable expenses
Revenue generation and profit sharing
Employee will take due responsibility to bring in revenues through possible channels and client
visits. However adhere to local laws and respect them (like no spam or unsolicited approaches)
Based on the business conducted with client, revenue will be documented and accounted as per
regulatory needs of the Govt of India, US and Canada for preventing of double taxation and fair
wage policy monitoring purpose and external auditing. Book of transaction records for all
expenses and revenue generated will be retained
Profits into this account will be generated post sales of deal project or any work that generates
revenue. A 5% commission will be charged on the Total Contract value or deal size. For
example if there is a win of $ 1 million worth project, a flat rate commission charges of $50,000
(includes taxes) will be the liability of the employer that needs to be settled in a 30 day period.
The percentage of profit sharing can be changed as per mutual agreed upon discussions.
Annual tax returns
As this is an Employer-Employee relation, company is liable to get auditor’s report, file suitable
returns. Support for local in person tasks can be provided as requested. Suitable tax deductions at
source forms shall be given to employee. Suitable tax treaties law need to be applied for tax
deducted at source to avoid double taxation and subsequent dip in profit margins.
Code of conduct
Both parties, Employer and Employee will not assume anything outside the specified company
laws or Govt. regulations. There will be no discrimination based on sensitive or personal attributes
like color, race, gender or social status includes religion, caste, tribe etc. Any issues arising for
acts, behavior due to either purposeful or due to ignorance should be dealt with properly to rectify
the issue on mutual understanding or legal intervention as needed. Local and international laws
are applicable as required for safe inclusion or exclusion of company laws
Termination of job /contract
Both parties have equal rights and proper notices have to be given like a 1 month written notice
period and satisfactory handover and exit formalities. Local laws related to fair exit policies have to
be adhered and no harassment or heavy penalty should be fined for not clear reason. Also
working for competitor should be allowed if laid-off. Other standard company legal rules prevail