Track Your Expenses

Expenses can be hard to track, which means that you may be missing tax write-offs that you could have benefited from.

Business credit cards can be handy tools to make sure all expenses are kept together and tracked. As long as you keep up to date with your payments that is. Most providers have now adopted the service of categorizing your bill into types of expenses, meaning one less task for you to do.

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To help prepare for audits, it is also useful for you to make notes in your calendar of the clients that you are meeting for each of those coffee dates, lunches and events. This will help substantiate your expenses for your tax records, should you be audited.

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That goes for car mileage too. When driving long distances to meetings, make sure you either keep track of your mileage or do a calculation with Google Maps to log how far you travelled and the associated costs.

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Record Deposits Correctly

Whether it’s a pocket notebook and pencil, an Excel spreadsheet or financial software like Quickbooks, make sure you keep track of what is being deposited into your business bank account.

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You are likely to make a variety of deposits in your account throughout the year. From loans, to sales revenue, to cash infusions from your personal savings. If you cannot account for where each of the deposits have come from you’re leaving yourself open to paying taxes on money that isn’t income.

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Set Aside Money for Taxes

You know that you’re going to have to pay taxes and you know when. So systematically put money aside for it. Unpaid taxes can incur penalties and interest from the CRA, so make sure the money is there when you need it.

By putting money aside each month, or each time a contract is paid, it will come as less of a sting when they are due.

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Keep an Eye on Your Invoices

Late and unpaid bills can hurt your cash flow. Assign someone to track your billing. Then put a process in place for if a bill goes unpaid. That can be issuing a second invoice, making a phone call and even levying penalties such as extra fees at certain deadlines.

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Make a plan for if clients are 30, 60 and 90 days late. Remember, every late payment is an interest-free loan that hurts your cash flow.

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Software & Apps

We recommend using apps that help you ease the day-to-day process when it comes to bookepping.

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Quickbooks is an application that connects with your bank and allows you to categorize all your transactions, from sales, expenses, capital injection, and more.

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Dext is an application that allows you to take photos of your receipts and automatically scans them and uploads them to quickbook if connected, without the need to type the amounts and description.