Income-based financing for self-employed Canadians

Cash received matters more than invoices issued

A self-employed person may show strong sales while having little cash available after supplies, taxes and operating expenses. An income-based loan application should therefore explain actual receipts, seasonal changes and the money that can be drawn for personal use. Bank statements, tax information and a simple cash-flow forecast can help make irregular earnings understandable. An unpaid customer invoice should not be counted as certain cash for an imminent instalment.

Separate turnover from spendable earnings

Match the financing route to its purpose: household borrowing and funding business equipment involve different assessments. BDC’s business lending considers company performance and credit information; it is not a substitute marketed without checks. A personal budget review with Credit Canada can help separate household obligations from the enterprise’s needs. Before accepting a daily or weekly debit arrangement, calculate the effect of delayed customer payments and a quieter trading period on both sets of expenses.