Owner Operator?

Oooh boy. Okay first things first
K.I.S.S. make a plan and keep it simple. Make a rough budget and go off that. Ex.

10,000mi X $1.50 = $15,000
6mpg X 10,000 = 1,666 gallons
1,666 gallons at $4.50 a gallon = $7497
So
15,000 - 7497 = $7503
Truck payment is 3-3500
7503 -3500 = $4003
Your WSIB is gonna be around $200 (rough)
Deductible buydown around $150 (rough)
And 'plates and insurance' which the company will hit you with a small fee is normally 50-100

Your left with $3553 take home roughly, based on 10k a month. 6mpg and fuel prices being high, and running a new truck.

Always budget your miles low, fuel bad, prices high, and truck payments crazy, if you can survive with everything like that then when

Your miles are amazing! Your fuel mileage is great! Fuel is cheap! And your payments are sensible, you're in the clear.

As for fuel subsidy. Don't really worry about it, in most cases it's on average only an additional .21 cpm in your pocket and it's all pre calculated and added to your pay.

 

Most companies do have fuel subsidies, or a 'surcharge'. Once you get their pay package to review and send in your application it should mention an average surcharge. It changes either weekly, bi weekly or monthly based on who is doing the calculations.

As for things like tires and brakes? When you first start get a line of credit, you want at least $10k. A full set of drives will cost you 3-4k easy, and steers are easily just as if not 2x as expensive. Brakes are cheap, if they are drums anyway.

That 10k will be for emergencies and is not to be touched unless it's needed. Then when you start making money open a savings account dubbed "maintenance" and put 250-500 each pay or each month in that account, And never stop doing that. That larger that account gets the better off you are.

OH AND A TRICK TO AVOID TAXES.

***TRADE SECRET SPOILER****
Pay yourself nothing.
900 every 2 weeks if you can.
That's 1,800 a month, and 21-23k a year.
Your not making enough to be taxed by the government for Income tax, and at the end of the year give yourself a 'bonus' of say 5k or 10k. It's untouchable most times.
** and you'll find when you do tax returns at the end of the year you'll get big returns, like 3-4k.

Your bonus is based on your companies revenue, there are 2 ways to run the business.
1. Make money, pay taxes.
2. Make money, fudge taxes.

To do #2 expense, expense, expense, if your books are in the "green" spend money on repairs, or bonuses, and put them in the black. That way you never have to pay business tax which can eat up to 50% of your revenue. Some things that can be expensed are as follows
* cell phones, laptops, stationary items, clothes, gas in personal vehicle to run errands, some food for 'business meetings', shoes, any safety equipment, showers, paid parking, ect. Ect. Ect.

 

You are essentially, but most people forget you're not the company. You're 3 people. 1. The owner trying to save money, 2. The payroll guy, 3. The company guy.

Also in 6 years. The fuel has never gone over $4.50 a gallon Canadian. I should have mentioned that. Us average price is 3.50. Its around 4.50 canadian a gallon.

It's not easy to start, but if you can make it past year 2 your laughing. Then you can start making changes. The first 2 years is setting everything up to make money.

 

People also don't realise if you buy a truck, all your doing is buying a job. That's all.

You won't get rich unless you land that special gig, and trust me that's a once in a lifetime deal. So all you'll be doing is guaranteeing your employment. If you wanna make money you need to start a trucking company. IE. 5+ trucks. All fleet spec throwaway money makers.

Then you'll be making serious coin, with serious headaches like keeping mush heads happy.

 

Two other ways to lessen the tax bite. Paying yourself dividends instead of employment income is taxed at a way lower rate. But the real gem is paying yourself back. Loan payments aren't classified as income. If you're incorporated, then you can pay yourself personally for the money you used (loaned to the company) to start everything in the first place. Loan payments are tax free.

 

Wrong..
Dividend vs t4 income is pretty well the same now... in Ontario at least.

Loan payments are tax free as far as the principle goes. Any interest your company writes off on a loan is considered taxable income to whoever your company pays it to. Even if you are the lender and also the company owner.

There is no free lunch.

 

Hah, don't charge your own company interest. And dividends are taxed 17%.

 

If I don't charge my company interest I can get a better rate of return in the market and borrow for less than my market return why lend the company a dime?

Perhaps you should be my accountant. We work it out every year. I draw a steady 75k regardless of how much I work. I take 1k a month for first 11 months then decision time for December. It always works out very close if I take it as income vs dividend.