For a small business, the end of the year might be one of the busiest times as they try to organize their accounting issues. You need to finish several small and large activities to ensure that your company is prepared for a new beginning in the coming year. The common ones like T4s, taxes, reconciliations, and financial statements come to mind when thinking about year-end.
However, you need take into account the less obvious, which is your business plan.
When reviewing your company plan, ask the following two very explicit questions to yourself:
- Have we achieved our objectives for the present year?
- What do we want to achieve in the upcoming year?
- How can we accomplish these objectives?
These are relatively simple queries, but using them to gain insight from you and your team can develop a sense of unity around your corporate goals.
Key tax changes – 2022 and beyond
According to the new mandatory disclosure rules that are being proposed, you might be compelled to declare some transactions in 2023. In particular, if you or your business engages in transactions that are deemed “notifiable transactions” or “reportable transactions” in accordance with the new regulations, you must typically report these transactions to the CRA within 45 days of the transaction date.
Payroll
Every employee who earned more than $500 in total earnings throughout the financial year MUST receive a T4 by February 28th.
No Casual Labour
- A T4A is required for everyone receiving commissions, bonuses, retirement benefits, and other sorts of special payments.
- A Workers Compensation Reconciliation report must probably be submitted to your provincial government.
- A health tax reconciliation with the provincial government might be required.
- You must make sure that ALL of your employees have accurate, current TD1 forms on file; failure to do so will result in a $25 per employee per day punishment.
Make sure your staff data is correct
Make sure your year-end payroll and cost figures are accurate. The employer, not the employee, is in charge of ensuring that CPP and EI deductions are accurate.
Do your housekeeping
Invoices, receipts, and statements should be organised and stored in a way that makes them easy to find in your files. In case the CRA ever requests your records, you must keep them on hand for three years.
Corporate Tax:
The most crucial thing to conduct at year’s end is to make absolutely sure your financial data is correct and comprehensive.
The submission of complete and accurate information goes a long way toward cutting down on the audit time and potential fines if you are ever subject to audit or review by the CRA or one of the sales tax organisations.
Being in constant contact with your bookkeeper
As a small business owner, it’s probable that you’ll interact with your external accountant or bookkeeper the most during tax season and at the end of the year. It’s important that you communicate your expectations with your accountant during these busy periods. Consider the day of the month you like to check in, the file type you prefer to receive, and any special reporting standards you may have.
If you have any queries or worries regarding your year-end filing responsibilities, feel free to contact finnection via email at info@finnection.ca or call us at (647) 795-5462
Disclaimer: Above information is subject to change and represent the views of the author. It is shared for educational purposes only. Readers are advised to use their own judgement and seek specific professional advice before making any decision. Finnection Inc. is not liable for any actions taken by reader based on the information shared in this article. You may consult with us before using this information for any purpose.