As a small business owner in Calgary or Vancouver, your number-one priority is running your company. Whether you have orders to fill, clients to meet, or patients requiring attention, the accounting aspects of your business are not likely your core strength.
Still, ensuring that your accounting is taken care of in an efficient and timely manner is very crucial for any enterprise. Whether you are launching a new start-up or own an established small company, following are the key areas to keep in check.
New Business Accounting
Before getting too far with launching your new company, you will most likely need to apply for a business number. This is required if you plan to hire employees for your company, and if sales exceed the limit of $30,000 over four consecutive quarters.
It is also critical to acquaint yourself with the important deadlines throughout the year. Business owners who are self-employed can wait until June 15 to file. Any balances owing, however, must be settled by the regular April 30 deadline.
Regular monthly accounting
The first task is to install the best possible accounting software on your computers. From there, you can decide which tasks will be handled by your staff, an outside bookkeeper, or a professional accountant.
These tasks may include reconciling bank accounts, the posting of invoices and payments, and filing of GST/HST (more related to that below). The proper and timely recording of this information, and ensuring the various expenses and revenues are posted to the accurate accounts, will save time at tax season.
GST: Registering, Filing & Collecting
Most companies are required to register for a GST number when applying for a business number. If not, the six-character GST code will be applied as a suffix to your existing business number. If your company has exceeded $30,000 in sales over the past four quarters, you will need to apply and file for GST.
Learn more about registering, filing and collecting GST/HST with our guide here.
You will be required to file your GST return either monthly, quarterly, or annually. Information regarding the taxable sales over this period must be filed to the federal government ahead of the deadline. A qualified accountant will ensure your company is GST-compliant, with your return handled in good time.
Preparing for Tax Season & Year-End
If your small business is incorporated, a T2 income tax return must be filed.This involves helping you to organize receipts and paperwork in advance, preparing financial statements, filing the return, and staying by your side in the event of a CRA audit.
But a good tax accountant does not stop there. Efforts can be made to minimize your income tax and maximize your return. Reductions to the small business tax rate mean further opportunities exist.
Managing employees
Not to be forgotten is the bookkeeping of employees’ salaries. Payroll deductions must be remitted to the federal government on a regular basis. There is also the matter of calculating vacation pay, and organizing bonuses and benefits.
Depending on the amount of bookkeeping work you decide to take on, a professional accountant can either handle these tasks entirely or help to guide you throughout the process.
