Your Business Year End in Retrospect and Preparation

Posted by on Mar 10, 2011 in QuickBooks Tips | 0 comments

First of all I must give credit for the following information to Ledgers Canada, who I have found have timely tips and valuable insight.

The end of the year does not have to bring woes to your business, in fact, it should represent a time to reflect on the successes (and failures) of the previous year and a time to look forward to the upcoming year, your business plan and goals.

When thinking about year end, the obvious comes to mind; T4’s, taxes , reconciliation’s and financial statements. You should however consider the less obvious, that is, your business plan. When looking at your business plan, ask yourself a couple of very specific questions:

1. Did we reach our goals for the current year?

2. Why or Why Not?

3. What are our goals for the coming year?

4. How will we achieve these goals?

These are very basic questions, but asking them of yourself and your staff can provide insight and build a team atmosphere around your business objectives. Involving staff, partners and alliance partners in your planning process may provide you with insight into areas you cannot readily see.

If you operate a family business involve your family, including children, in the planning process. Children sometimes have uncanny insight into things ‘adults’ cannot recognize. If you plan to someday turnover your business to your children, involving them at a young age will also help guide the future of your business.

Business plans aside, what else should you consider at year end?

Payroll

All employees that have had cumulative earnings in excess of $500 in the calendar year MUST receive a T4, on or before February 28th. All persons receiving commissions, bonuses, retiring allowances and other types of payments must receive a T4A.

You will likely need to file a Workers Compensation Reconciliation report with the Provincial Government. You may need to file a Health tax reconciliation with the Provincial Government.

You will need to ensure you have accurate, up to date TD1  forms for ALL employees (the fine is $25 per day per employee for missing forms)

Corporate Tax

You will need to complete your financial statements, Accounts Receivable & Accounts Payable reconciliation’s.

You will need to file a Corporate tax return (if applicable) with the Federal Government (and some Provinces). The most important thing to do at year-end is to ensure you have accurate, complete financial information. If you have not filed in several years or your QuickBooks is not up-to-date, how will you know what is owing or possibly, owed to you (think GST)?

If you are ever subject to an Audit or Review by CRA or one of the Sales Tax agencies, the display of complete and accurate information goes a long way to reducing the audit time, and likely penalties. When considering who to assist you with year-end duties, remember it is a very common misnomer that a ‘firm’ needs to file your returns. This can be done by qualified trained people, who may be your QuickBooks Trainer or colleagues.

If you need help in preparing your books, setting up your QuickBooks, training, filing your income tax or consultation, they you can contact me.

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