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5 Common Bookkeeping Mistakes Canadian Small Businesses Make (and How to Avoid Them)
Running a small business in Canada is challenging, and bookkeeping often takes a backseat. However, financial mistakes can be costly. At Northern Numbers, we’ve identified 5 common bookkeeping errors and how to avoid them:
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1. Mixing Personal and Business Finances
Using one account for personal and business expenses creates confusion and complicates tax filings.
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Fix It: Open a separate business account and credit card.
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2. Missing GST/HST Deadlines
Late GST/HST filings lead to CRA penalties.
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Fix It: Set reminders or let Northern Numbers handle your filings.
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3. Failing to Reconcile Accounts
Skipping reconciliations can result in errors or undetected fraud.
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Fix It: Reconcile monthly or use accounting software to automate the process.
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4. Not Tracking Expenses Properly
Poor expense tracking means missed deductions and inaccurate reports.
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Fix It: Keep receipts organized and use expense-tracking tools.
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5. DIY Bookkeeping Without Expertise
DIY bookkeeping often leads to errors and compliance issues.
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Fix It: Hire professionals like Northern Numbers to manage your finances.
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Let Northern Numbers Simplify Your Bookkeeping
Avoid these mistakes with our expert bookkeeping, payroll, and tax services. Focus on your business while we handle the numbers.
Yukon Budget 2024: Key Tax Changes & How They Impact Your Business
Whitehorse, YT – The newly released Yukon Budget 2024 includes several tax and incentive changes that could affect local businesses. Here’s what you need to know: 1. Small Business Tax Credit Expansion The Yukon government has increased the Small Business Tax Credit threshold from 500 , 000 t o 500,000to600,000 in taxable income. Impact: Eligible businesses will see reduced territorial tax rates on their first $600K of income. 2. Carbon Tax Rebate Boost A new 10% rebate increase for small businesses investing in energy-efficient equipment. Deadline: Applications open June 1, 2024. 3. Hiring Incentives $5,000 grants for Yukon employers hiring apprentices in skilled trades (carpentry, electrical, etc.). 4. GST Filing Simplification Businesses with under 250 K r e v e n u e c a n n o w f i l e G S T a n n u a l l y ( w a s 250KrevenuecannowfileGSTannually(was150K). What This Means for You "These changes could put thousands back into your cash flow," says [Your Name], Founder of Northern Numbers. "But deadlines matter—especially for rebates." Need Help Navigating the Changes? Our team can help you: Maximize tax credits Apply for rebates Adjust your bookkeeping for new rules
What’s New in Canadian Tax Laws for 2024: What Businesses Need to Know
Tax laws in Canada are constantly evolving, and staying updated is crucial for businesses to remain compliant and maximize savings. Here’s a quick overview of key changes in 2024 and how they might impact your business: 1. Increased Small Business Deduction Limit The small business deduction limit has been adjusted to reflect inflation, allowing more businesses to benefit from lower tax rates on their first $500,000 of income. What It Means: If your business earns under the threshold, you could pay less in taxes. 2. Changes to GST/HST Reporting New reporting requirements for GST/HST aim to streamline processes but may require businesses to update their systems. What It Means: Ensure your accounting software is up-to-date or work with Northern Numbers to stay compliant. 3. Enhanced Carbon Tax Rebates The federal carbon tax rebate has been expanded, offering more support to small businesses affected by rising energy costs. What It Means: Check if your business qualifies for additional rebates. 4. Stricter CRA Audits The CRA is increasing audits for small businesses, particularly around payroll and GST/HST compliance. What It Means: Double-check your records or let Northern Numbers handle your filings to avoid penalties. 5. Digital Services Tax (DST) A new Digital Services Tax may apply to businesses earning revenue from digital products or services. What It Means: If you operate online, review how this tax impacts your revenue. Stay Ahead with Northern Numbers Navigating tax law changes can be overwhelming, but you don’t have to do it alone. Northern Numbers offers expert tax preparation, compliance, and advisory services to keep your business on track.
​Why Cloud Accounting is the Future for Canadian Businesses
In today’s fast-paced business world, cloud accounting is revolutionizing how companies manage their finances. Here’s why cloud accounting is a game-changer for Canadian businesses: 1. Real-Time Financial Data Cloud accounting software like QuickBooks Online and Xero provides instant access to your financial data, so you can make informed decisions anytime, anywhere. Why It Matters: No more waiting for month-end reports—stay updated in real time. 2. Remote Access With cloud accounting, your financial data is accessible from any device with an internet connection. Why It Matters: Manage your finances on the go, whether you’re in the office or on-site with a client. 3. Automated Processes From bank feeds to invoice reminders, cloud accounting automates repetitive tasks, saving you time and reducing errors. Why It Matters: Focus on growing your business while the software handles the busywork. 4. Enhanced Collaboration Cloud accounting allows multiple users, like your bookkeeper and accountant, to access the same data simultaneously. Why It Matters: Streamline communication and ensure everyone is on the same page. 5. Scalability As your business grows, cloud accounting grows with you. Add features or users as needed without costly upgrades. Why It Matters: A flexible solution that adapts to your business needs. Let Northern Numbers Help You Transition Ready to embrace the future of accounting? Northern Numbers can help you set up and manage cloud accounting software tailored to your business.
​Payroll Management in Canada: Best Practices for Small Businesses
Payroll is one of the most critical—and complex—aspects of running a business in Canada. Get it wrong, and you could face penalties from the CRA. Here are 5 best practices to simplify payroll management: 1. Stay Compliant with CRA Regulations Ensure you’re up-to-date on payroll deductions, remittances, and reporting requirements. Why It Matters: Avoid costly penalties and audits by staying compliant. 2. Use Payroll Software Invest in payroll software to automate calculations, deductions, and tax filings. Why It Matters: Save time and reduce errors with automated processes. 3. Keep Accurate Records Maintain detailed records of hours worked, pay rates, and deductions for each employee. Why It Matters: Accurate records are essential for CRA compliance and resolving disputes. 4. File T4s on Time Ensure T4 slips are prepared and filed by the CRA’s deadline (usually the end of February). Why It Matters: Late filings can result in penalties and unhappy employees. 5. Outsource to Experts Managing payroll in-house can be time-consuming and error-prone. Consider outsourcing to professionals like Northern Numbers. Why It Matters: Focus on your business while experts handle your payroll. Let Northern Numbers Handle Your Payroll From payroll processing to T4 preparation, Northern Numbers ensures your payroll is accurate, compliant, and stress-free.
​How to Choose the Right Accounting Partner for Your Canadian Business
Choosing the right accounting partner is one of the most important decisions you’ll make for your business. Here’s what to look for when selecting a bookkeeping or accounting service in Canada: 1. Expertise and Certifications Ensure the firm has certified professionals with experience in Canadian tax laws and accounting standards. Why It Matters: Expertise ensures accuracy and compliance. 2. Range of Services Look for a provider that offers a full range of services, from bookkeeping and payroll to tax filing and financial advisory. Why It Matters: A one-stop shop saves you time and hassle. 3. Technology and Tools Choose a firm that uses modern accounting software like QuickBooks or Xero for efficient and accurate financial management. Why It Matters: Technology streamlines processes and provides real-time insights. 4. Responsive Customer Support Your accounting partner should be accessible and responsive to your needs. Why It Matters: Quick support means fewer delays and less stress. 5. Client-Focused Approach Look for a partner that takes the time to understand your business and tailors their services to your needs. Why It Matters: Personalized service ensures your unique needs are met. Why Choose Northern Numbers? At Northern Numbers, we check all the boxes. With certified professionals, a full range of services, and a client-focused approach, we’re here to help your business thrive.
​Year-End Tax Tips for Canadian Small Businesses: Don’t Miss These Deadlines
As the year comes to a close, small businesses in Canada need to prepare for tax season. Missing deadlines or overlooking key tasks can lead to penalties, stress, and missed opportunities to save money. Here’s a quick checklist to help you stay on top of your year-end tax responsibilities: 1. Reconcile Your Accounts Ensure your financial records match your bank statements. This includes reviewing accounts payable, accounts receivable, and payroll. Why It’s Important: Accurate records are essential for filing taxes and identifying discrepancies. 2. File T4 Slips for Employees If you have employees, you must prepare and file T4 slips by February 28, 2024. Why It’s Important: Late filings can result in CRA penalties. 3. Maximize Deductions Review your expenses to ensure you’re claiming all eligible deductions, such as office supplies, travel, and home office expenses. Why It’s Important: Deductions reduce your taxable income and save you money. 4. Submit GST/HST Returns If your business is registered for GST/HST, ensure your returns are filed and any amounts owing are paid by the deadline. Why It’s Important: Late or incorrect filings can lead to penalties and interest charges. 5. Plan for Next Year Use your year-end financial data to create a budget and set goals for the upcoming year. Why It’s Important: Planning helps you stay organized and financially prepared. Let Northern Numbers Handle Your Year-End Taxes Year-end tax preparation doesn’t have to be stressful. At Northern Numbers, we specialize in helping Canadian small businesses stay compliant and maximize savings. From reconciling accounts to filing T4s and GST/HST returns, we’ve got you covered.
The Benefits of Outsourcing Your Bookkeeping: Why Canadian Businesses Are Making the Switch
Running a business is hard work, and managing your own bookkeeping can add unnecessary stress. That’s why more Canadian businesses are outsourcing their bookkeeping to professionals. Here’s why outsourcing might be the best decision for your business: 1. Save Time and Focus on Your Business Bookkeeping is time-consuming, especially if you’re not an expert. Outsourcing frees up your time so you can focus on what you do best—growing your business. Why It Matters: Spend less time on paperwork and more time on your customers and products. 2. Access to Expertise Professional bookkeepers are trained to handle complex financial tasks, from payroll to tax filings, with accuracy and efficiency. Why It Matters: Avoid costly mistakes and ensure compliance with CRA regulations. 3. Cost Savings Hiring an in-house bookkeeper can be expensive. Outsourcing gives you access to top-tier expertise at a fraction of the cost. Why It Matters: Reduce overhead costs while still getting high-quality service. 4. Scalability As your business grows, your bookkeeping needs will change. Outsourced services can scale with you, adding or reducing support as needed. Why It Matters: A flexible solution that grows with your business. 5. Peace of Mind With professionals handling your finances, you can rest easy knowing your books are accurate, up-to-date, and compliant. Why It Matters: Less stress and more confidence in your financial decisions. Why Choose Northern Numbers? At Northern Numbers, we make outsourcing easy. Our team of certified bookkeepers provides tailored solutions to meet your business needs, from daily bookkeeping to payroll and tax filings. Let us handle the numbers so you can focus on your business.
Understanding GST/HST for Canadian Businesses: A Beginner’s Guide
If you run a business in Canada, understanding GST/HST is essential. Whether you’re just starting out or need a refresher, this guide will walk you through the basics of GST/HST and how to manage it effectively. 1. What is GST/HST? GST (Goods and Services Tax) and HST (Harmonized Sales Tax) are consumption taxes applied to most goods and services in Canada. The rate varies by province: GST: 5% (applies in Alberta, British Columbia, Manitoba, Northwest Territories, Nunavut, Quebec, Saskatchewan, and Yukon). HST: Ranges from 13% to 15% (applies in Ontario, New Brunswick, Newfoundland and Labrador, Nova Scotia, and Prince Edward Island). Why It Matters: Knowing your rate ensures you charge and remit the correct amount. 2. Do You Need to Register? You must register for GST/HST if your business earns more than $30,000 in taxable revenue over four consecutive quarters. Voluntary registration is also an option for smaller businesses. Why It Matters: Registering allows you to claim input tax credits (ITCs) on business expenses. 3. Filing and Remittance Once registered, you’ll need to file GST/HST returns and remit the tax collected. Filing frequency depends on your business’s revenue: Annual: If revenue is $1.5 million or less. Quarterly: If revenue is over 1.5 m i l l i o n b u t u n d e r 1.5millionbutunder6 million. Monthly: If revenue exceeds $6 million. Why It Matters: Missing deadlines can result in penalties and interest charges. 4. Claiming Input Tax Credits (ITCs) ITCs allow you to recover GST/HST paid on business expenses, such as office supplies, equipment, and services. Why It Matters: ITCs reduce your net GST/HST payable, saving you money. 5. Common Mistakes to Avoid Not Charging GST/HST: Failing to charge GST/HST when required. Incorrect Remittance: Sending the wrong amount to the CRA. Late Filings: Missing deadlines and incurring penalties. Why It Matters: Avoiding mistakes ensures compliance and saves you from costly penalties. Let Northern Numbers Simplify Your GST/HST Managing GST/HST doesn’t have to be overwhelming. At Northern Numbers, we handle everything from registration to filing and remittance, so you can focus on running your business.
​How to Improve Cash Flow Management for Your Canadian Business
Cash flow is the lifeblood of any business. Without it, even profitable companies can struggle to pay bills, invest in growth, or weather unexpected challenges. Here are 5 practical tips to improve cash flow management for your Canadian business: 1. Invoice Promptly and Accurately Delayed invoicing can lead to delayed payments. Send invoices as soon as work is completed or products are delivered, and ensure they’re accurate to avoid disputes. Why It Matters: Faster invoicing means faster payments and better cash flow. 2. Track Expenses Closely Keep a close eye on your expenses and identify areas where you can cut costs without sacrificing quality. Why It Matters: Reducing unnecessary expenses frees up cash for essential operations. 3. Offer Early Payment Incentives Encourage clients to pay early by offering discounts or other incentives for prompt payment. Why It Matters: Improved cash flow and stronger client relationships. 4. Monitor Accounts Receivable Regularly review your accounts receivable to identify overdue invoices and follow up with clients. Why It Matters: Staying on top of receivables ensures you’re paid on time. 5. Forecast Your Cash Flow Create a cash flow forecast to predict future income and expenses. This helps you plan for lean periods and make informed financial decisions. Why It Matters: Proactive planning prevents cash flow crises. Let Northern Numbers Help You Optimize Cash Flow At Northern Numbers, we specialize in helping Canadian businesses improve their cash flow through accurate bookkeeping, financial reporting, and strategic planning. Let us help you take control of your finances.
​The Top Accounting Software for Canadian Small Businesses in 2024
Choosing the right accounting software is crucial for managing your business finances efficiently. With so many options available, it can be overwhelming to decide which one is best for your needs. Here’s a breakdown of the top accounting software for Canadian small businesses in 2024: 1. QuickBooks Online Features: Invoicing, expense tracking, payroll, GST/HST tracking, and financial reporting. Best For: Small to medium-sized businesses looking for an all-in-one solution. Why It’s Great: User-friendly, cloud-based, and integrates with many other tools. 2. Xero Features: Bank reconciliation, invoicing, inventory management, and multi-currency support. Best For: Businesses with international clients or complex inventory needs. Why It’s Great: Scalable and offers a clean, intuitive interface. 3. Wave Features: Free invoicing, expense tracking, and receipt scanning. Best For: Startups and very small businesses on a tight budget. Why It’s Great: Completely free for basic features, with optional paid add-ons. 4. FreshBooks Features: Time tracking, project management, invoicing, and expense tracking. Best For: Service-based businesses and freelancers. Why It’s Great: Excellent for tracking billable hours and managing client projects. 5. Sage Business Cloud Accounting Features: Invoicing, cash flow management, and financial reporting. Best For: Small businesses looking for robust reporting and compliance features. Why It’s Great: Strong focus on compliance with Canadian tax laws. Need Help Choosing the Right Software? At Northern Numbers, we can help you select and set up the best accounting software for your business. From QuickBooks to Xero, we’ll ensure you’re equipped with the right tools to manage your finances effectively.
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