Running a small business comes with many challenges; we get it, we are small business owners too. This article will explain how hiring an accountant can help you throughout the life cycle of your business.
Before starting a business, hire an accountant
If you are planning to start a business, an accountant can help you with a lot of things. An accountant can work with you to create a plan and help you avoid mistakes and problems that are common with new businesses. You might be surprised how much money is wasted when entrepreneurs don’t understand the complexities of running a business. This is where accountants shine!
When creating a Business plan
An accountant can help you create a business plan based on realistic information. Many startups fail because the assumptions used are too optimistic or not based on current market conditions. Optimism and risk tolerance are useful ingredients when starting a business. However, the accountant will help balance the plan. He can use the experience and knowledge he has gained to help many different businesses get off the ground and grow.
When creating forecasts
Forecasting is an essential part of creating your business plan. An accountant can help you understand and anticipate the various costs associated with starting and building a business. Trying to determine where to start and how to build a forecast can often be confusing. Your accountant should have a template you can use to get you started. They will also be able to sit down for you to crunch the numbers and create a balanced and accurate forecast.
For more information on required start-up funds, see our article on how much money you need to start a business.
When defining the Company structure
Should you incorporate your business or run it as a sole proprietor? This is a very common question and an important topic to understand. An accountant can look at your specific situation and help you make the right choice. Incorporating your business can have legal and tax advantages, but there are also some disadvantages. Your tax accountant will help you with this.
If you’ve decided that incorporation is right for you, check out our article on how to incorporate your business. Get in touch with accountants near me.
There are many different programs you can apply for when starting a new business, and it’s not always easy to determine what is required. An accountant can help you by making sure your small business is registered with the appropriate programs. Often this advice can save you time and money in the long run.
Common examples include:
- Register for GST/HST early to save money by claiming input tax credits.
- Consider using the express method for GST/HST to pay less tax.
- Sign up for Payroll to avoid hefty interest and late deposit penalties.
These are just a few of the many programs a new business may need to sign up for. The accountant will be able to understand them and make sure that the assignment takes place at the right time.
When buying a business
If you’d rather buy an existing business than start from scratch, an accountant can help you complete the transaction. Accountants can help do due diligence on a business to make sure the financials and purchase price make sense. They can also help structure the purchase in the most tax-efficient way. It is also a good idea to consult with a lawyer before buying a business. This team of accountants and attorneys can help you make sure your purchase is the right one, so you’re set up for success.
Hire an accountant after starting a business
If you were previously too busy getting your business off the ground to hire an accountant, don’t worry, it’s not too late. Along with many of the items mentioned above, there are many things an accountant can help you with once you start your business.
Not all accountants offer bookkeeping services, but it can be useful to combine bookkeeping and bookkeeping under one roof. Small business accounting can get complicated quickly. It can take up time that could be better spent working on your business. An accountant can also keep track of who owes money to a company that will have cash in the bank.
If you’re not sure how an accountant can help you, check out our article on what an accountant can do for your business. And if you’re wondering how much it will cost, we also have an article on bookkeeping and bookkeeping costs for small businesses.
When we talk about compliance, we’re talking about preparing and submitting the reports needed to satisfy government and other regulatory bodies.
- Preparation and submission of t2 tax returns (corporate or personal)
- Filing of sales tax returns (GST/HST and PST).
- Ensure payroll transfers are paid on time and correctly
Your accountant can keep you compliant and out of trouble, so you avoid paying costly late fees and penalties. It also gives you peace of mind knowing you’re keeping the CRA and other government agencies happy. No one wants an auditor knocking on their door.
Get in touch with accountants near me.
If you find an auditor knocking on your door, an accountant can be of great help. Audits are stressful and time-consuming, but with the help of an accountant, they go much more smoothly. It is not uncommon for an audit to result in zero additional fees owed.
Your accountant will communicate with the auditor to ensure that all required information is provided in the correct format. Auditors are human too, so mistakes can happen. Your accountant will help you spot any mistakes in the audit process to make sure you don’t pay more tax than you should.
You don’t have to go through the audit yourself; your accountant can provide advice and expertise.
Hire an accountant as you grow your business
Once you are at the stage where your business is functioning and you want to focus on growth, seek the help of an accountant. We don’t support growth for its own sake but understand that it is an important part of building a life-changing business. This will also help you when filing t2 tax returns.
Tax planning and advice
When people think of business accounting advice, they often actually think of tax and tax advice. There is a good reason for this; accountants know these things inside and out! A tax accountant can make sure your business is not only tax compliant but also tax efficient. For example, you may want to set up a holding company to save taxes or protect your company’s assets. There are many ways an accounting professional can help your business pay less tax. This will also help you when filing t2 tax returns.
There are also many financial aid and government grant opportunities that a tax accountant can identify and help secure for your business. Who doesn’t like free money? Speaking of free money, one of the biggest opportunities in Canada that an accountant can help with is tax credits for scientific research and experimental development.
Get in touch with accountants near me.