To save on payroll taxes and workers' compensation premiums, many employers arrange their affairs in such a way that those working for them are self-employed, independent contractors. This is good tax planning.

On other hand, some employers take position that all those working for them are self-employed, whether they are or not. Although it is tempting to eliminate payroll taxes and workers' compensation premiums, care should be taken to do so legally.

Whether those working for you are employed or self-employed is a question of fact (which can be determined by Courts). Do you supply tools and vehicles? Do you determine working hours? Do you have right to control how job will be done? Do you pay a flat-rate or by-the-hour or a salary? Does your worker have other clients?

By asking several such questions, a pattern will emerge as to whether your worker is employed or self-employed. If it turns out that your worker fits all criteria of an employee, don't say he's self-employed. On audit, you would still be responsible for payroll taxes (and penalties and interest as well).

Even if your workers are considered independent contractors by Income Tax Department, it is still possible that they will be considered to be "workers" for purposes of Workers' Compensation legislation. Thus, it is responsibility of employer to determine whether such coverage is necessary or not. Failure to obtain proper coverage could subject you to substantial (and unnecessary) costs.

In review, calling someone self-employed, doesn't necessarily make them self-employed. If you have a dog, call it a dog. Your position that your dog is really a cat will not be successful. Likewise, make sure that your position regarding your workers is legally correct.

Popular Misconception #8: ------------------------- "My Accountant Charges Too Much. -------------------------------- I Can't Afford It Anymore." --------------------------- Is Your Accountant Worth His Fee? ---------------------------------

Many business persons view bookkeeping, accounting, and tax preparation as necessary evils. In their view, accounting fees are an expense to be reduced, deferred or even completely eliminated.

A good accountant, however, can give you benefits far in excess of fees charged. Well-designed accounting systems will enable you to extract meaningful financial information for your business that will help you to manage it properly, avoid business failure, and alert you to declining sales, excessive expenses, tax opportunities, cashflow problems, and many other vital concerns for your business.

Your accountant can save you lots of money with advice you receive on tax and other business matters. As well, a competent accountant can be a valuable resource in discussing business problems and opportunities with you.

Popular Misconception #9: ------------------------- "Nobody Makes Money On The Internet." ------------------------------------- Can You REALLY Profit From The Internet? ----------------------------------------

Many people feel that internet is all hype. Many others feel that it is overrated. Still others are of opinion that it may be good for some types of business, but not theirs.

Typical comments heard include: "I've lost money on internet...Major corporations have lost millions...Do you personally know anyone who has made money from internet?"

However, if you check out list of recent billionaires, a high proportion of these are internet-related, and many of them under forty years of age. As well as very rich, you can find many cases of more modest financial prosperity resulting from internet commerce.

It is true that many are losing money on internet. It is also true that many don't know what they're doing. However, with proper assistance, you, too, could profit from net.

J. Stephen Pope, President of Pope Consulting Inc., http://www.popeconsultinginc.com/ has been helping clients to earn maximum business profits for over twenty years.

Make A Six Month Survival Plan Give yourself some peace of mind by making a six-month survival plan. Once you know exactly what you will need to stay on top, your anxiety will lesson and your creativity will increase. This is a perfect example of being pro-active instead of reactive.

Understand The Ebb and Flow of Your Business Keep exact records of sales week-to-week and month-to-month every single year. By doing this you will begin to understand busy times and slow times of your business. In turn this will allow you to plan financially for slow times. Every business has a slow period during year, it's important that you know what yours is in order to plan for success of your business.

Diversify Your Marketing Techniques Do not depend on one marketing avenue to get you through tough times. Perhaps this one marketing technique has worked for you in past, but obviously something has changed, and now so must you. Make a list of possible marketing avenues and begin researching which methods are most cost effective in relation to results.

Get Professional Help If You Need It Smart business people understand when they need outside help. Do you? If your business is doing more sinking than swimming it's time to seek a professional to help you put your business on stable ground. Many, many businesses have filed bankruptcy when it wasn't necessary. Professional financial mediators can help you with creditors and get your business moving in right direction again.

A downward shift in economy can cause heart-stopping reactions where your business is concerned, but once you learn how to work through situation you soon realize you and your business can weather any storm.

Peter Robben is a professional business mediator who helps business owners find solutions to debt, creditor problems, and financial insolvency. If your business is struggling, contact him today by first visiting www.WeSolveDebt.com