Wow, the holidays have nearly arrived.
Which also means year end is almost here. I hate to admit it but I am definitely not as prepared as I would prefer to be. But you know what? That’s okay, I am giving myself permission to be less than perfect for one of the most stressful times of the year. You should do the same. Today let us focus on all of the good and amazing things that have come to be this year. Celebrate your wins and the wins of others!
As your financial year is coming to end now is a good idea to take inventory (not necessarily literally) and make a strategy to get your game face on for tax time.
Here are five things you can do today to prepare.
In the most stress free way possible of course.
- Set a date on your calendar that you need to have your taxes done by. I suggest not later than March 15, 2015. Make it real and put it in your calendar. While your at it, why not schedule in a few reminders. Or if you are like me and love your apps the CRA has made it easy for you by creating a Business Tax Reminders mobile app. How cool is that?!
- Login to your online banking and download and file all of your monthly account statements. Most online banking services will only keep your statements online for about 18 months. So it is a good idea to log in sometime before year-end to get everything you will need, (before you need it). From there I find Evernote* is an amazing resource for keeping your digital business records. Don’t worry if you can’t figure it out straight away. I have plans to create Evernote tutorials for the new year. You’re going to love it, it’s so easy once you get going. Not to mention powerful, oh and FREEEEEEE!!!
- Gather all of you receipt hard copies and organize them chronologically. This will minimize the time it takes to enter them into your accounting software. Of if you’re one step ahead. Review your bank statements to make sure you have a copy of everything you need. Did you know that you are required to keep copies (yes actual copies) of all of your receipts for 6 years from the date you file in Canada and up to 7 for the United States? Well love you do. Just one more reason to get set up with Evernote. I
- Get a second opinion. Talk to your bookkeeper or accountant and review to make sure you are recording all of the deductions you are entitled to. It’s all about Tax Planning and NOT Tax Evasion. Tax Planning is implementing a strategy to legally reduce your tax liability. The key term being “legally”. While Tax Evasion is intentionally and illegally avoiding paying your tax liability. Now no one will say you should pay more taxes than you need to, the key here is using the legal means available to you. This is why it is best to work with an accounting and or financial professional.
- Save!! It is a totally different ball game when you are self-employed. You no longer have “The Man” taking up to 30% off your paycheque each week. It’s all on you now babe, so be sure to set aside some cash for your taxes. Did I ever tell you about my first year in business as a newly graduated Massage Therapist? Boy was that a wake up call! Even if you end up receiving a refund you will be glad you have set aside a little nest egg because it well set you on the right course for the next year. While you’re at it, why not put that money into a Tax Free Savings Account (TFSA) and invest it short-term? Win-win. Every Canadian should have a TFSA!
Now that this year is quickly coming to an end I’d love to know, have you made any big plans for 2015? I feel like so many amazing things are just upon the horizon. I hope you can feel it too.
My biggest resolution (don’t laugh) is to get super diligent about creating the most useful accounting blog I can. Writing doesn’t come naturally for me but I am embracing the discomfort and pushing myself to grow.
So how about you? Anything exciting, amazing, juicy, expansive, or otherwise fucking awesome planned for 2105!
As always you have my deepest gratitude for joining me. XO and happy holidays whatever they may be for you.
*Affiliate link, but you also get a free month of the premium this way 🙂