10 Ways to Get Your Finances in Order
Managing your business finances is not an easy task. However, it is extremely important to keep your accounts in order for your company’s future. You can make more informed decisions when you understand how your revenue and expenses are stacking up. Companies offering accounting services can help you manage your expenditures. They can make tax reporting and payments a lot more convenient.
At Hurren Sinclair MacIntyre, our team of experienced professionals offers relevant solutions in an ever-changing business environment.
Maintain a Bank Account
Open a separate bank account to save your company’s income. Business-checking accounts have higher fees than personal banking. Make sure you get all the information about fee structures before selecting a bank.
Ensure to keep your personal money separate from any commercial amount even if you are the sole proprietor. This will help you in keeping distinct records, organizing funds, and planning for taxes. You can also consider requesting for a business credit card.
Track the Expenses
Tracking your expenses effectively is crucial to monitor the growth of your business and build financial statements. It will also help you keep track of deductible expenses and prepare your tax return report.
Establish a system to organize receipts and other important records. If managing your own finances is starting to get difficult for you, hire a qualified accountant.
If you are looking for experienced bookkeepers, Hurren Sinclair MacIntyre is the answer. We offer accounting services to clients throughout the Durham region and across the GTA.
Select Accounting Software for Your Business
It is necessary for you to record your day-to-day process transactions, categorize them, and reconcile bank statements. Canadian business owners legally need to use the accrual method of accounting.
You can still use the cash method throughout the year and make a single adjusting entry at year end. By doing so, you can account for outstanding receivables and payables for tax purposes.
There is a variety of accounting software solutions available online. You can pick the right one for your business.
Keep Your Finances Organized
Monitor your accounts and plan for future revenue and expenses. This will allow you to make better long-term decisions for your business. You should plan at least 10 years of finances to stay ahead of the competition.
This will help you tackle unexpected expenses and avoid major problems.
Plan a Budget
Creating a budget is an essential part of a business plan. It provides you with a framework to make clear-headed decisions. For instance, you can increase your marketing spend or cut the expansion costs to keep your profits on track.
Use your budget as a guide to make adjustments where necessary.
Setup a System to Manage Payroll
While hiring, establish whether the individual is an employee or an independent contractor.
For the former, decide on a payroll schedule and withhold the correct taxes. For the latter, track how much you are paying each person.
Manage Your Invoices
Check your invoices every morning. Try to clear them off before starting your work.
Make sure you track all payments due and record when each invoice is paid. Note how long customers generally take to pay and which customers have delayed their payments in the past.
Find out Your Tax Obligations
Tax obligations differ based on the legal structure of the business. You can claim professional income on your personal tax return if you are self-employed.
If you are a part of a corporation, your income will be taxed as an employee. This is because corporations are taxed independently from owners. You can simplify your tax planning process by hiring professionals to do the job.
Our chartered professional accountants have significant experience in providing taxation services to clients from different sectors.
Re-Evaluate Your Methods
You can use a simple spreadsheet to manage your finances when you first start out. As you grow, you may have to consider more advanced methods like Bench.
It is good to continually reassess the amount of time you spend on your accounts and how it affects your business. A good bookkeeping solution can help you in saving a lot of money.
If you want your enterprise to grow, it is essential for you to keep your finances in order for long-term stability and sustainability.
Preparing business accounts is a time-consuming process, but the end results are worth the effort. Whether you are looking for taxation or accounting services, contact us today!