Automate Your Small Business Accounting

When you started your small business enterprise, you expected some paperwork; but did your expect that much?  Probably not.  One way to cut down on the administrative tasks is to automate as much as possible.

Payroll – This is probably one of the most time-consuming tasks.  Adding new employees means tax documents and the variety of other paperwork to be sure everything is completed.  Check out a program called Collage.  It can calculate hourly, salaries, bonuses, taxable benefits, and more. 

Invoicing and Collections – Find the best program that suits your needs.  It should have the ability to generate invoices on an automatic and recurring basis, especially for fixed-rate customers (like retainers).  Be sure it also has a reminder system that will send out an appropriate prompt for late payment and so that you can keep track of any outstanding collectibles. 

Document Storage – There are a number of scanning programs available.  Beyond transferring a paper document into electronic data, there are programs that will capture the information and compile reports.  Be sure that it is accessible.  If you use multiple devices, make certain the program is available across whatever you use.  Store securely.  Cloud storage is becoming more popular by the day.

Employee Issues – First there is recruiting.  ZipRecruiter will submit your job posting to a number of different sites and still lets you manage the applications.  Training is an ongoing process, but you should also be sure to document how the person is succeeding, or not.  As you grow your business and add new employees, you will find the need for tracking programs against set goals to provide documentation for annual wage increases or bonuses.  Under the law, you will need to keep lots of personal information on your employees, like emergency contacts, time off, and tax records.  Go back to the program Collage and you will find just the spot to store all the information.

Social Media – Today many of our customer contacts come through Twitter and Facebook.  There is a program called Buffer that will let you create the post at your convenience and then release the information at scheduled intervals.  You will use your time more efficiently, including those spare minutes you find on occasion.

Email – Be sure to automate your email to sort the junk from the important stuff.  There is an adage that says handle every piece of paper only once.  Apply that to your electronic correspondence as well. 

MailChimp is a free program that has multiple uses including automatic responses and messaging.  You can upgrade for a fee and get even more help.  There are also other sources that will let you have access to information like abandoned shopping carts, delivery updates and the like. 

E-commerce – Speaking of orders and deliveries, there are several programs that will simplify your shipping.  There are a number of non-custom programs that will help you maintain profiles, customer preferences, and track orders.   

As your business expands, you will be glad that you automated early in the process so that you can focus on the fun part of being a small business entrepreneur.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

Tips to Have a More Productive Work Week

Managing your work time is critical to your physical and mental well-being.  Knowing when to stop or reassign priorities or delegate means establishing realistic goals and overall will result in more productivity for you and the company.

Establish Increments

Looking at a huge project is overwhelming and can be depressing.  By mentally dividing it into segments you should be able to actually be more productive.  Just like performing repetitive tasks without a break will cause lapses in attention, working continuously on a project can be counterproductive.  Taking brief breaks can enhance focus and you will ultimately construct a better final product.  When each smaller increment is completed, there will be a sense of achievement and realization of the ultimate goal.

Prioritize 

Not everything can be the most important.  Limit yourself to five items that must be handled.  Then do those five things first.  After those are completed, look at the remaining tasks and start tackling them.  Before you leave your desk at night, write your list for the next day.

Look at the Big Picture

Spotlight the most important items and then move on to the next group.  If you have had to refocus from your original top choices, write down what you did accomplish and cross them off your list.  You will at least feel as though you were successful in some realm of your operations.

Measure Results 

Try to avoid thinking about how many hours you are devoting to some task, but how close you are to completing it.  Mentioned above was dividing it into smaller chunks.  Instead of thinking about the 20,000 words you need to write, concentrate on 200 words at a time.  As each section is complete, you should feel some elation at finishing what you set out to do, and perhaps a bit more.

Routine 

Establishing and maintaining a routine to start your day will trigger your mind and body into a productive mode.  Without that schedule, you can tend to procrastinate over the larger or more odious tasks you will need to complete that day.  Another technique is to turn off or put your phone away at least while eating.  It will give you a break and help you feel more refreshed.

Wasted Time

Try to find where you are wasting time.  If you are taking too long to choose an outfit for the day, take time over the weekend to set out ensembles for each day of the week.  You can add a little flexibility by having optional jackets if the weather changes or your meetings alter.   How many times a day do you stop to chat with a co-worker?  How long are each of them.  If you find yourself pinned down by a chatterbox, always keep a file folder handy so that you can wave it around and look harried and get back to your desk pronto.

Know When to Quit

Staying up all night to finish something really works against you.  You become too tired to function well.  It is much better to call it a night and re-start fresh.  You are less likely to make costly errors.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

Accountants in Mississauga

At Capex CPA we have a team of accountants dedicated to serving the Mississauga community.  Our goal is to collaborate with our small business and entrepreneur clients to provide them with the best service possible.  We go beyond year-end reporting and tax filings.  We offer advice and reporting that will move your business to the next level.  Our clientele includes many diverse industries including technology, hospitality and healthcare.

Working with cloud technology, we are able to bring a dynamic expertise to your business.  This increases efficiencies for our customers and improves their business perspective and, at the same time, allows them to create cost savings.

All of our accountants maintain an honourable membership in the Canadian Tax Foundation.  We supplement our credentials by incorporating other certifications including Elite Quickbooks Proadvisor, Certified Hubdoc Advisor, Certified Wagepoint Advisor, and others.  Not all accounting firms can claim this level of competency.  By judiciously choosing the right programs for your business, we can help you navigate through the business world during good times and bad.  Some of the highlights include: 

• Transparency - Full Access to your Accounting data.

• Fixed Prices - There are no surprise bills. Period.

• Awesome Support - Need a quick question answered? No Problem!

• Tax Strategy - We build a custom Tax strategy to your business.

• Robust Reporting - Tools that let you make decisions in real time.

• CFO Partnership - We add value above and beyond your taxes!

Advice

As partners in your operation we are here to offer advice regarding tax advantages.  In addition, we can help you gather the necessary financial data necessary when you pursue financing.  We understand what lenders and investors may expect and are happy to share this knowledge with our clients. 

Operationally we have experience in different business types and can help you make the best decision to reach the goals you have set.  As your company progresses, your goals will change and we are there to help you with this journey to success. 

Education

Part of our role is to be sure you understand the implications of your decisions.  Technology is adapting to the modern business and we help you adjust along the way.  Working through cloud technology is efficient and beneficial.  We hope to give you the tools to make your daily, monthly and annual accounting and tax processes as convenient as possible.

Our support team is available for your needs.  We can be easily reached through phone, email, Skype, WhatsApp, and social media.  We are proud of our approach to customer service.

If you are in the market for an accounting firm that is on the cutting edge of cloud technology, our chartered professional accountants in Mississauga are ready to help.  We are experts in this software and can guide you no matter your level of understanding.  Our rates are competitive and our invoices are easy to understand and accurate.

Please feel free to contact us to set an appointment with an accountant in Mississauga to discuss our services and how they can benefit you.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

5 Smart Ways So Safeguard Your Business in Uncertain Times

Even though every business owner hopes for smooth and easy progress, they also know that anything can happen to disturb the regular operation.  Larger companies usually have some advantages in terms of financing options or cutbacks in personnel or operations.  Small businesses generally do not have that luxury.  So, it becomes very important for the smaller concerns to have a plan in place for downturns and contingencies. 

Customers

If you are experiencing difficulties, it is very likely that your customers are too.  Adapting to their needs can help you navigate your own problems by keeping them on as paying clients.  Work with them to determine whether any changes will be short term or of long duration.

Staying visible to your customers is also important.  They need to know that you are open and ready to do business.  If the issue is just within your industry or company, contact your clients in a friendly way to let them know you are available to provide them with your service or goods.  If at all possible, increase your presence with an email campaign or through social media.

Concentrate on client retention at least long enough to endure the current crisis.

Become Essential

Even in good times, develop your own niche.  Find out what your customers really need and develop that trait as much as possible.  It could be as simple as outstanding customer service or short, casual conversations to help them understand you are on their side.  Inquire about something they are interested in, like sports, family, etc. 

Review your contracts for flexibility.  Be sure you are not going to be penalized if you can’t deliver, especially if it is no fault of your company.  Incentives for your clients should be considered, but instead of offering a discount, make sure they ask for it.  Or instead of a discount, give a price break for more volume.  If you can be flexible on your receivables terms, that can help out some other company that is also struggling in hard times.

Communicate

As much as possible, don’t keep secrets from your employees.  It is just as likely that they already recognize that your business is in difficulty.  Don’t dismiss suggestions without thinking it through.  If it is not feasible, explain why.  You have great resources in your staff and you should use them to your advantage.

If you want empathy from your clients, you need to show it to them.  Kindness will cost you nothing.  Offer patience with other people who are in the same boat.  Try to practice the Golden Rule.

Be Realistic

Start with the basics and review all expenses and income.  Try to find efficiencies to increase revenue without spending more than you can afford.  

If you have a relationship with an accounting firm or financial advisor or bank, go to them and see if they are able to help you find something you have missed.  They may have worked with other similar companies in comparable circumstances and have some insight into what worked and what didn’t. 

While times are good, develop a safety net.  Plan how you can economize when a downturn hits so that you will be in better shape to weather the difficulties.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

Don’t Make Cash Flow a Problem

Cash flow is one of the critical elements in any business, but especially in a small business environment.  One of the key factors to generating income is invoicing.  I know that sounds obvious, but careful management of your invoicing system can be one of the most important basics to running your business.

Invoices

As a deal is closed, whether it is for a single item or a large project, reiterate the billing schedule.  It can be a fixed date, upon delivery of goods, at milestones, or project completion.  As your bookkeeper or biller sets up the account, recap it for him or her.  It may seem like overkill but this is important stuff. 

Set up a personalized invoice.  Customize it if necessary for a repeat customer.  There are lots of templates available and most automated systems offer you some choices. 

Pay attention.  Don’t let invoices go unpaid.  There are a number of ways to follow up on late payments.

• Automation – It is a time saver.  It can be phrases as a friendly reminder that an invoice was overlooked.  There are also tactful ways to reiterate the statement when the deal was closed about when the payments would be due.

• Early Payment – It might be in your best interest to offer a slight discount if the bill is paid significantly early.  You will have better cash flow and the customer will be motivated to pay early.

• Telephone – The human touch is also a viable alternative.  Unless the payments are way out of hand, just a simple phone call is usually a motivator.  It should be friendly but firm.

Purchasing

Cash flow deals with money exiting your coffers as well as entering.  Be cautious with automated refills.  Be sure you need that much inventory whether office supplies or products for your business.  Check your payment schedule.  Unless the vendor is offering a discount for early payment, delay until you need to release the money.  

Try to pay before interest starts to accumulate.  If you get really behind, talk with your suppliers about payment flexibility.  Check out zero interest business credit cards. 

Sales Volume

Don’t confuse wishful thinking with a realistic estimate of your future sales.  Forecasting is difficult in many circumstances, but for a new business it is extremely hard.  You have little or no historical data to rely on.  You may be able to draw on information from related businesses.  Just be conservative with your projections.  This should help with overspending and then being caught in the squeeze.

Cash Flow Budget 

Don’t forget Accounting 101.  A cash-flow budget is a detail of all the cash in and out during a given time frame.  It allows the owner or manager to see the status on an ongoing basis.  It can help you plan for tight periods or off-season flux. 

In the vast majority of start-ups cash flow is a scary balancing act.  You are encouraged to keep at least two months of cash reserves to help with operating expenses, but that is not always possible.  While it is certainly a challenge, with some concentrated effort, you can win.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

Questions to Ask When Looking for an Accountant

If you own a business, chances are at some point you will need to hire an accountant.  There are some things you need to consider when shopping for this person or firm.

Expertise 

Just like other fields, accountants specialize. Someone who only deals with start-up companies in the tech field may not have the knowledge necessary for a large manufacturing company, for example.  Ask about their other clients in your industry or field and size of business. Most accountants will readily explain if your needs are outside their field or beyond their capacity.  If so, ask for a referral to someone they know who might be better suited. 

Experience

How long have they been doing accounting?  You should shoot for someone with at least five years under their belt.  Working with a larger firm will give you more individuals to choose from, plus if the person assigned to you is short on experience, they will have someone senior to consult with. 

Background 

Ask about the actual degree of the person who will be working on your account.  You should also find out if they are licensed.  A Certified Public Accountant license is nice to have, but not necessarily a requirement.  Attorneys specializing in taxes should have a degree in taxes.  There are other degrees that might be relevant like an MBA that focused on tax-related issues. Find out what continuing education they participate in and how recent were the classes.  There are many talented people out there, but you need to choose someone in whom you have confidence. 

Audits 

Should you be audited, will the accountant represent you at the hearing and through the process?  If not, you may want to keep looking.  If so, will there be an additional fee for the service?  Will they also review previous tax returns and will there be a charge for that?  It might be a good idea to have copies with you at the time of the interview so the accountant has an idea of what they will be working with. 

Fees

Usually the fees are charged by the hour, but not necessarily.  If you are dealing with a large accounting firm, a more junior staff member may be charged at a lower fee.  Be sure you understand what the fee will cover and what it will not.  Bring home a printed copy of their schedule so you can compare prices from one accountant or firm to another.  Ask if there is anything that you, as the client, can do to reduce the amount of the charge. The more organized your paperwork, the less time the accountant will need to spend sifting through the receipts and income statements.

Local or Not

Some of this is personal preference.  If you need to look him or her in the eye each time you have a return to file, then yes, they should be local.  Also, some firms and people have offices in areas other than downtown (with high overhead costs).  Some may even work out of their homes.  Don’t rule out working electronically.  Scanning the documents and submitting them through email, Dropbox, or Google Docs can be more efficient.  Telephone or Skyping also can resolve questions easier than texting several times.

The ultimate conclusion is whether you are comfortable with the person or company you choose.  Do they answer your questions to your satisfaction without making your feel foolish or using too much technical jargon?  Do you trust their abilities to do a good job?  These are all things to consider as you find professionals to help you with financial issues.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

Bad Bookkeeping Habits to Stay Away From

It is oh so easy to develop bad habits and very difficult to break them.  When you are talking about a business enterprise, bad habits can be disastrous.  Here are some things you might want to think about to help keep your operation in good working order and make your lenders and investors happy.

Budgets and Reports

One of the top projects to have up to date is a report of how you are faring compared to what you budgeted.  Along with that is looking at your profit margins, both gross and net.  Closely tied to these reports are your accounts receivable.  Staying on top of what is owed to you will help with your cash flow.

Establishing a Routine

If you don’t have a regular routine for posting information and generating reports, you should have.  If the reports are standardized and performed on a regular basis, you will have a better chance to review the key data for your company.  There are many accounting software packages that will help you with this project.

Synchronizing

When you choose your accounting software, be sure they will work well with each other.  The term is integration.  If all the platforms that they run on are compatible, you will have an easier time generating the information you need, as well as avoid wasting time re-entering or transferring data from one source to another.

Training

Be sure that someone else knows how to enter the data and retrieve information.  If something happens and you or your bookkeeper is suddenly gone for a week, work will still get done.  Cross training at least one other person is a necessity.

Along with that is keeping up with all of the changes in tax law and the accounting software.  Contact customer support for the program you run and see if they can help when necessary.

Allocating Funds

Be sure to reserve an appropriate amount of money for the payroll taxes.  The government doesn’t like to be forgotten and you would do well to stay on their good side.  Overhead and payroll are the next items to keep on your watch list.

Deadlines 

Having set deadlines means you will have the appropriate information at your fingertips when you need it.

Filing

Whether you keep paper files or electronic versions, the better your documents are organized the better chance you will have at finding the exact piece of information quickly when you need it.  Maybe it will mean adjusting work hours one day a week.  That is better than a missed deadline or overdue rent.

Mixing Personal and Business Accounts

If you are running your small business alone, be sure to keep your two accounts separate.  Have separate bank accounts and checks.  You will have a better picture of the health of your company. 

The survival of your business is based on a solid financial plan.  In order to be successful, you will need to develop the best bookkeeping and accounting habits possible to help you with the financial scrutiny you will have from the tax people and your investors.  If you are unsure of your footing, hire a professional at least as a consultant or as a long-term employee to keep things running smoothly and profitably.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

What Is Xero Accounting?

Accounting software has been developed to automate various accounting and bookkeeping functions and to allow reports to be generated without manual calculations.  It is frequently available for use across multiple devices and uses cloud storage.  It usually also integrates into the ability to produce invoices, pay bills, maintain payroll, and other functions, which is a significant positive. 

One of the hot accounting products on the market is produced by a New Zealand company called Xero.  It is currently used in over 180 different countries.

These programs are software as service (SaaS).  That means the software can be accessed at any time or anywhere as long as you have an internet connection and web browser.  It allows personnel to work from remote locations.  Their mobile apps work with iOS and Android and can generate an invoice immediately.  For sales people that means closing the deal on the spot.

For the small business owner especially, this means no investment in hardware like servers or maintaining an IT staff; the vendor takes care of any upgrades and troubleshooting.   

Xero’s significant characteristics include:

• Invoices

• Accounts payable

• Purchase orders

• Automatic bank feeds and reconciliation

• Standard reporting

• Payroll

• Inventory

• Depreciation

Because it is international, it handles tax rates and many currencies. The data is also very secure with encryption and authentication protocols.

It was developed specifically for small business operations and can accommodate integration with other business applications.  It has been priced to appeal to the small business owner.  It was designed to sync with other programs and to be easily learned, although, like most programs, there is a learning curve.  They have a strong support team including a 24-7 service team, blogs, and video library.

It will allow you to expand the number of users and to be specific about the levels of their security and abilities to access data.

Invoices can be customized for the business and it offers the ability to issue recurring invoices.  It is superior when working with bank statements and reconciling the double entry system it offers.  The reports seem to be one of its shining moments.

The developers offer a free trial version for up to 30 days to see if it is suited for your needs.  Then there are three different levels of plans depending upon the size of your company or to accommodate future expansion. 

Nothing is perfect and some of the concerns seem to be the lack of an ability to be notified of payment without first logging into the system.  Similarly it only accepts full payment rather than partial, nor does it accept automatic recurring payments.  It is definitely designed for small businesses and doesn’t work especially well for concerns that deal in larger purchases.

If you are tired of the tedium of bookkeeping tasks or want to avoid hiring someone to do it for you, Xero Accounting is a good product, especially if you deal with multiple currencies.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

Tax Tips for Business Owners Navigating the Pandemic

Operating a business during the Coronavirus (COVID-19) pandemic is a challenge.  It can be a complex decision about having employees return or being open to the public.  There are national and local guidelines and regulations to ensure the safety of all concerned. 

There are other issues to be considered that will impact your business financially, including lower revenues from customers avoiding your premises and fewer trained employees to serve.  You may also incur higher costs for sanitation and personal protective equipment. 

Tax Planning

Consider a loan at a prescribed rate that will split investment income with a family member.  With the move to lower interest rates by the central bank, you can possibly lock in a significantly beneficial interest rate. 

Check with your accountant about any passive investments and see if the passive income tax rules will apply.

Keep careful records of all office expenses, including those for home office operations for you and your employees.  The CRT will probably have some guidelines when it comes time to file the 2020 return and you want to have all the back up materials at hand. 

On a personal note, it is important to have all Wills, healthcare agreements, powers of attorney, etc. reviewed and updated as necessary. 

Federal Support

The Business Credit Availability Program (BCAP) is offering support through credit.  The Canada Emergency Business Account is allowing for bank loans up to $40,000 for small businesses.  These are interest free for the first year and up to $10,00 can be waived for repayment.  There are conditions and restrictions. 

Look into any municipal support available.  This could include deferrals of utilities or taxes.  Check into any credits or incentives even if you haven’t taken advantage of them previously.

Work Share

The work sharing program was extended to 76 weeks from its original 38.  This can be an advantage to employers who opted to reduce hours rather than lay off staff.

Supplemental Unemployment

A supplementary unemployment benefit plan helps with the wages of employees during unemployment, temporary or indefinite.

Employment Insurance (EI)

There are special benefits designed for the self employed as well as a temporary wage subsidy for small businesses that have employees.  Many of these small operations have closed and some are not sure if they will resume after the pandemic recedes.

Temporary Wage Subsidy

This is a program that will cover up to 75% of employees’ wages.  Check to see if your company is eligible and what it will take to use this benefit.

Prepare for a Setback

Even with phased openings, there is the possibility of a recurrence of the virus.  When this started in the spring it was reactionary.  Now you have the opportunity to plan should you need to evacuate a second time. 

Your accountant is available for consultation on a variety of financial issues.  Use this important resource for your small business or self employment.  They will be keeping tabs on the availability of subsidies and government programs.  They are also the experts who will be watching what the CRA will be allowing as deductions for next year’s tax return.

If you're looking for an accountant in Brampton or Mississauga, Contact our team at CapexCPA today for more information. Click on the link below to book a meeting.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

Important Tips for Setting up a Business

Starting your own business is a terrific adrenalin rush.  It is exciting and empowering.  It can all too soon become overwhelming and frightening.  Most small start-ups fail.  But you are not average and you can make your dream come true with a solid plan and advice.

Legal Structure

Choosing the correct corporate entity is a good start.  Depending on your choice, it will affect the amount of liability you are willing to undertake on a personal level, as well as the amount of paperwork.

• Sole Proprietorship – You have all the control and all the liability. You are personally responsible for all the financial obligations.

• Partnership – This is when two or more persons will share the responsibilities and the liabilities. All the partners are personally responsible for any financial obligations.

• Corporation – This gives the responsibilities to a legally established entity. It functions somewhat like a person and the corporation is responsible for the financial obligations, not individuals. This can also have an impact on taxes. In order to establish a corporation, it needs to be legally established and filed with the appropriate local and provincial governmental offices. There will be fees and lots and lots of record keeping and filings.

• Limited Liability Company (LLC) – This is a combination of a partnership and a corporation. It protects the owners from the personal liability of a sole proprietorship or partnership.

There is no perfect type of corporate structure.  Each has benefits and detriments.  Consult with an attorney and financial adviser to decide what is best for you and the circumstances of your business 

Growth

You have a great product or service.  Before you go too far, make sure there is enough of a market to sustain a business.  Know your target audience and develop ideas of how to get the word out.  In other words, marketing. 

Once things start to roll, be sure you can sustain the product.  Be sure you have the capacity and funding to move forward.  You may want to locate and consult with a “Growth Hacker”.  That is someone who can see the big picture and yet dissect it into manageable bites that you can handle as an entity and that your financier will view as productive and reasonable.

Follow the Money

One of the greatest concerns in a start-up operation is cash flow.  The entity needs to begin with strong financial flooring and then strong controls to be sure you can pay all the bills.  Part of this relies on accurate and timely record keeping, including inventory, personnel, and utilities.  The more you can pay on time, the better you will look to your backers, especially if you want a loan.

Goals

Make sure you document all your successes and set reasonable and achievable objectives.  This applies to the overall scope of the business plus anyone who is working for it.

A good idea is to work closely with reputable accountants who will guide and advise you along the way.   They can direct you to experts or mentors who will provide invaluable assistance in your venture.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

Are There Benefits to Income Splitting?

Canada’s interest rates have recently hit new lows.  With that comes an interesting side effect.  The Canada Revenue Agency’s prescribed rate drops.  These prescribed rates are tied to Treasury Bills, with 1% as the lowest prescribed rate possible.  In April 2018 it was set at 2% but for the third quarter of 2020, the prescribed rate will drop to 1%.  This will represent a significant opportunity for couples and families to income split.

This is a tactic that lets the spouse with the higher income reduce their taxable income for the CRA.  If both parties are in the same tax bracket, this won’t help them.  Nor is it beneficial for single parent families.  But for folks with disparate incomes, it is a boon.  It is a possible benefit for those who are interested in pension splitting if it either establishes a pension tax credit for the spouse or increases a current one.

Pension Splitting – Money is not actually transferred from one person to another.  It is just an accounting method of allocating income on the tax return.

Dividend Income – If the taxpayer is entitled to a spousal tax credit, all those dividends may be shifted to the spouse (or common law partner).  However, this is an all or nothing; no partial transfers allowed.

Capital Losses – Under the superficial loss rules, the capital losses can be moved to the spouse by having that person purchase the shares.  However, there is a window of 30 days on either side of the transaction.  The loss amount increases the cost basis of the investment and the spouse must retain the shares for over 30 days after the disposition.

Money Lending – The person in a higher tax bracket may loan money to the spouse or even a child.  The lent money can then be used to purchase investments and that income will be allocated to the lower bracket individual.  There are regulations about interest payments and arms’-length transactions. 

Employing Family Members – This is only for those who are self employed, but you can hire your spouse or children, pay them a reasonable wage and reap the benefits in tax splitting. 

As you can tell, there are some real opportunities here.  However, there are also many technicalities involved in saving tax dollars.  It is always best to consult an accountant to be sure you are following all of the rules and your attempts will not be disallowed. 

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

5 Tips to Avoid Common Accounting Mistakes

When you own a business there are many challenges you will face, like reaching your target market, whether you are in the right location for what your business offers, if you have employees that will add or decrease the value of your business and so on –  the biggest challenge you may face will be the possible mistakes you could make when it comes to the accounting of your business. 

As we know, the financial part of any business is the most important aspect and making common mistakes in this area may eventually determine the success of your business.

Properly Maintain Financial Records

The simplest of ways to avoid making any errors when it comes to the accounting of your finances is to keep each and every record of income and expenses related to your business. This way you will be able to track progress, compare rates and choose better options for what you want to achieve with your business. Of course, keeping track of big expenses is something every business owner is aware of right off the bat but it is important to remember that there are smaller expenses that all add up in the end.

Keep Your Accounts Separate

A very common mistake made by many business owners is not keeping business and personal expenses separate. Having a bank account for your business separate to your personal account will avoid any issues with audits as you will be able to effectively provide any and all records relating to income and expenses that are strictly business related. In addition, you will be able to more accurately identify any potential errors or problems that may have occurred during the year.

Make Sure You Have Data Back-Ups

In an age where everything is done electronically hard copies of data has become almost completely obsolete but one of the biggest challenges we face is potentially losing that data due to a system crash or failure. Keeping this in mind, it is always a good idea to keep detailed back-ups of all data stored on electronic devices, should something happen to the system you are using. Losing data that contains records of your business’s accounting can be a devastating blow to your business.

Keep Your Records Updated

Making sure your financial records are updated can save you massive amounts of time and money when it comes to being audited. This is one of the simplest solutions to keeping your business safe from any liabilities, legally and financially.

Go Digital With Bookkeeping

It is simply a fact that people often will make mistakes whether they are a professional or not – anything can happen. A simple way to avoid any human errors is to do your accounting using digital software. When doing your bookkeeping digitally, there is very little to no room for errors that could potentially cost you more time and money than you can afford. You can even ask your accountant to do your books digitally if you do not do them yourself.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

Why Is Accounting Important for Start Up Businesses?

When starting up a new business you face many challenges and one of the hardest ones can be managing your finances by yourself in a safe, efficient and legal way. Why not get someone to do it for you? That is where accounting services come in handy. Having someone at the wheel of one of the hardest parts of running a business can take a huge load off your mind as a small business owner so you can focus on what matters the most – providing good quality products or services.

Some people start small businesses as a hobby but let’s face it, the most important part of any business, big or small, is the money it brings in on a monthly basis.

Keeping Track of Finances

One of the biggest reasons business owners will hire accountants is to keep track of how much money comes in and goes out in a month. This way you will be able to make sure that your business is running smoothly and making enough money to cover necessary expenses.

Monitoring Productivity

Having an accountant to keep a clear record of your income and expenses may help you keep an eye on what is making your business money and what is costing it –  this way you can enhance your business productivity by boosting what makes your business successful and cutting out unnecessary expenses.

Dealing with Legal Matters

As a new business owner, naturally you will be excited about the new possibilities of having a business and some extra cash coming in but you might not be completely clued up on the legal side of it. That is where a professional charted or certified accountant comes in – as it what they specialise in, they will be able to take full responsibility of the legal side of running a business so you won’t have to go out and teach yourself all of the nitty gritty of running your business legally.

Your Business Might Grow Rapidly

Many people do prefer doing their own taxes as trusting someone else with all of your personal information can be quite stressful for some but one can never foresee how rapidly your business might grow. Doing the financial work for a small business is fairly simple but when it comes to the financial work of a bigger business, things might get a little more complicated and you will need a professional to stay on top of it.

Economic Issues

Hiring an accountant to deal with your finances doesn’t stop at keeping track of your current financial state but will also be helpful when it comes to economic drops and how to deal with them without putting your business at risk of things like bankruptcy. Your accountant will be able to properly advise you on what to do if the economy rapidly changes and your business might need to function in a slightly new way to accommodate it without losing any income or making drastic changes.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

What to Look for When Hiring a Tax Preparer Near Me

When you hire a professional to handle personal information, like your or your business’s taxes, you want to rest assured that everything is properly taken care of legally and efficiently. There are a few simple criteria that you can look at before hiring a tax preparer that will, when properly met, put your mind at ease so you can focus solely on the quality of your business.

Ask For Credentials

It is important to remember that when you hire a professional to take care of your taxes, they will not only be involved in your personal information like your income, social security number, bank accounts and expenses but also will be representing you in any and all tax audits. Keeping all of this in mind, it is always best to make sure the person you want to hire has all of the legal credentials to take on this massive responsibility.

Before hiring your tax preparer make sure they have a legal Preparer Tax Identification Number (PTIN). This is a requirement from the IRS for anyone who is involved in preparing or assisting another person with their federal tax returns for compensation. The IRS will also require this number to be included on your official tax return, when submitted.

Make Sure You Can Fully Trust Your Tax Preparer

Legally, when you have hired a professional tax preparer, they are required to sign any tax return documents that may come in. This can be potentially tricky if you do not have a trust worthy tax preparer as they can file the return with their own bank account number and steal your tax refund, which can be a lot of money to lose. Of course, this is another reason to make sure they have a PTIN to include on your tax return documents.

Absolutely do not trust any tax preparer that will ask you to sign a blank tax return document, this will allow them to enter their details on your return and steal your money.

Your Tax Preparer Should Always Be Available

Your tax preparer is almost as important as having your doctor on call at all times, making sure the person you have hired to deal with your personal information is always available is crucial. Though they are the ones taking charge of all the paper work, you will still be liable for any mistakes made by them or you.

Hiring someone who isn’t available at all times might mean that you will have to personally take responsibility for any mistakes they might have made on your documents – this can be a very difficult situation as you might not be aware of where they had made these mistakes while having to explain them. Having an a tax preparer that is readily available at any time will spare you this inconvenient situation by being able to iron out any mistakes they have made personally, absolving you of any serious repercussions that might come with it.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

Simple Tax Planning Tips for Business Owners and Individuals

To avoid confusion amongst those individuals that are new to world of business strategies, tax planning is a legal way to optimally minimize and reduce your personal or business’s tax liabilities in a year. In other words, it is an analysis of your individual or business’s financial state or situation from a point of view that is most efficient to your fiscal well-being.

Of course, this is something that should be done well within the boundaries of the law and not to be confused with tax evasion which, if not done properly, can very well become the case. Here are a few simple tips you can use to do your tax planning in a way that will help you get the most out of your business or personal tax situation.

File Your Taxes Online

This might not seem like any way to minimize how much tax you pay in a year but, believe it or not, it has a lot to with it simply due to the fact that if you make any errors, fill in your information wrong, miss anything or add value to things that aren’t accurate – you will end up paying more than you should every year. When filing your taxes online, the likelihood of you making any of these mistakes is drastically reduced.

Make Use of an Accountable Plan

Making use of accountable plan not only be a very beneficial move to make for your business but will also build good relationship between you and your employees. An accountable plan is an arrangement you make to reimburse your employees for their business expenses like travel and entertainment related to the business not counted as income – by doing this you will lower your and your employees’ income tax within the regulations set by the CRA.

Fringe Benefits for Your Employees

In short, there are certain benefits your business can offer your employees to avoid paying additional wages that might trigger higher employment tax, such as:

Transportation benefits within business hours.

Health benefits or insurance.

Disability cover or insurance.

Education benefits or assistance.

Employee meals covered at work.

Dependent care assistance for employees.

Group Term life insurance.

These are only some of the things your employees might need to cover in their day to day lives that will require you to pay them extra, offering some of these benefits as part of their employment might cut some extra costs for your business in the long run.

Manage and Keep Any and All Documentation

This might be the simplest and most effective way of lowering your business and personal tax. Keeping a clear record of your expenses during the year will help and allow you to file the most accurate tax documentation, avoiding any and all errors that might cost you or business extra money that could have been profitable. You can achieve this by simply keeping and filing even the smallest of receipts of any expenses.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

How to Find the Best Small Business Accounting Service

When starting up a business, especially a small one, many people might think that hiring an accountant can be unnecessary as there is a finite amount of work to be done, right? Wrong. Your business, whether it be service or product based, will need all of your attention to consistently provide good quality work to consumers – that makes managing every aspect of your business, especially financial aspects, potentially impossible.

There are many things to consider when starting up your own business and which accounting service to use should be one of the biggest ones you think of first.

Choose a Relevant Accountant

As with hiring staff, it is always best to hire an accountant who has worked with companies and businesses that relate to yours, this way you will make sure that it is familiar ground for the person you are trusting with your personal information and they know what they are doing. Hiring an accountant that has not worked in the same or similar fields as your business can be stressful as you cannot rest assured that they know exactly what is going on.

Hiring an accountant that has worked in your field will give you peace of mind that they have years of experience dealing with similar issues, giving you the freedom to focus on the services or product you provide.

Consider the Location

The location of your accountant is a personal preference and will very rarely affect the actual accounting. Some business owners prefer to have their accountant on hand or face-to-face to deal with their personal and financial information while others prefer to do their accounting online or via Cloud Accounting services.

This all depends on the nature of your business and how you, as a business owner, functions best. If your business requires you to travel more often than stay in one location, then Cloud Accounting might be a better option for you as it is done online, in real time. On the contrary, if your business requires you to go into work in one stationary location every day, you might find it easier to have an accountant that you can work with in person.

Chartered or Certified Accountants Are the Better Choice

Whether your business is a new start up business or you have been doing it for many years, hiring a certified or chartered accountant to deal with your finances will always be the best and safest way to go.

Finding an accountant with relevant experience to your business can be rather challenging if you have a unique business – hiring certified or charted accountants will ensure that you have a degree level and experienced accountant to take on any financial issues that might occur in your business, despite if they have not worked in your specific field. It will also ensure your finances and business will be properly and legally protected during tax audits, loans or personal reviews. Chartered accountants will also be able to add extensive value to your business should it grow bigger and faster than you expected.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

Working From Home with Kids - Survival Tips

Across the country there are a growing number of telecommuters, freelancers, and stay-at-home parents all who work out of their homes.  The forced isolation of COVID-19 has only accentuated the task of dealing with children who are out of school or home schooled.  There are some things you can do to lessen the tension for all concerned.

Designated Areas – Each working adult should have a designated space, even if it is only a corner or section of a table.  It may take some reinforcement but kids need to understand parameters.  If there are multiple adults, it might be a good idea to alternate supervising homework or study time so that one parent is not overwhelmed. 

Routine – Although it is tempting to stay up late and binge watch your favourite program and then sleep in, don’t.  Children especially need a schedule and it wouldn’t hurt the adults as they transition back into traditional work spaces.  It may mean setting an alarm clock or timer so that everyone knows when it is okay to take a break or switch projects. 

Break Time – The situation is difficult for all concerned.  Everyone is entitled to food breaks and some time to recharge.  If safety in your neighbourhood permits, make it a group outing of a walk or bike ride to blow off steam and get some fresh air.

Privacy Issues – Children don’t necessarily understand the need for confidentiality, especially in relation to telephone calls.  First explain it in terms they will understand like correlating it to test taking when it is important to keep quiet.  It might also be necessary for you to find a location where you are alone, like in the garage or even inside your vehicle in order to fully concentrate on the business at hand.

Leniency – Maybe it will be necessary to go a little softer on some of your rules, like extending computer or television time.  There is also a reward system, just be sure you explain that the treat is because they were patient while you were working.  

Surf the Net – Take a little of your own time to find blogs, TEDtalks, etc. to find activities that your children might enjoy to keep them occupied.  

Be Creative – If they are old enough, let your kids plan dinner.  Give them a list of the basics available, (chicken, salad, types of vegetables, kinds of sauces) and see how well they do at orchestrating a meal or two.  Let them help with the preparation and give praise, even if it is not as tasty as you would prefer. 

 If you're looking for an accountant in Brampton or Mississauga, Contact our team at CapexCPA today for more information. Click on the link below to book a meeting.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

Top Small Business Accounting Apps in 2020

Small business owners are always looking for ways to work more efficiently and to improve their operations.  One of the ways is to use a good accounting app.  Switching is not easy so you want to be sure it is right for you before embarking on the experience.  At any point it is important to keep in mind not only your current needs but to try to anticipate what you will need going forward.  So here are some 2020 apps that are worth looking into.

Sage One – This is a fundamental app and is rather stripped down.  It does not deal with payroll, billing for time, and reports are nominal.  What it does have are cloud-based functions that include income and expense tracking, online payments through PayPal, and the ability for multiple users with only a single fee.

FreshBooks – This is another cloud-based app that is somewhat minimal but does offer support for iPhone, iPad, and Androids.  It will cover invoicing including reminders, expense tracking, and some reports.  They are advertising a complimentary 30-day trial and if you want to purchase, there are four different plans. 

Zoho Books – This has a broader platform and works with the major browsers plus iPhone, iPad, Android, and Windows Phone.  It has three levels, Basic, Standard, and Professional.  Each level builds off the Basic and adds more bells and whistles.  One plus is its Customer Relationship Management (CRM).  It accepts PayPal. 

QuickBooks – This is one of the staples and most recognizable accounting software program.  Offered in Pro, Premier, and Enterprise, they all track income, expenses, invoices, invoices, and online link to financial entities.  Payroll is available at an additional charge.  The first 30 days are free in both desktop and online. 

Xero – This is another one you probably are hearing about.  Coming out of New Zealand, it can work with Android, iPhone/iPad.  It has three plans, Starter, Standard, and Premium and the option to upgrade or downgrade at any point.  There is no Canadian payroll component at this time.  It also has a 30-day free trial and if you want to buy it, expect to pay in U.S. dollars.

It is always a good idea to discuss your options with your accountant.  They work with a lot of different sized businesses and are a good resource about what would work best for your size and type company.

Contact your Accountants today click on this link —> https://capexcpa.com/contact 

- The Capex Team

3 Tips to Start Your Small Business Accounting off Right

Starting up your own business can be a very exciting venture as it opens up many new possibilities for you and your family financially. As much as it is about the product, service and experience, it is about the ability to manage the income your business will generate.

Keep Track of All Income and Expenses

There is nothing worse for your business, no matter how big or small, than not knowing where your hard earned money is going. Naturally, businesses have to spend a certain amount of money to be able to buy materials for the production of what they offer to generate an income – keeping track of those expenses will give you an exact estimation of how much your business must spend in a month to run smoothly.

After a short amount of time you, the business owner, will be able to see where you can cut costs and what is absolutely crucial to spend money on. This will also enable you to efficiently compare prices and choose the best options for your expenses.

Hire a Professional

Many business owners, especially those of small businesses, would prefer to do their own accounting but hiring a professional charted or certified accountant may drastically improve your business’s productivity in the long run. Professional accountants will able to help with much more than simply keeping accurate track of your income and expenses as there are other factors that go with running a business – namely, the legal side of things.

When hiring a professional to take care of your business’s accounting, they will also be able to represent you in business audits that may be done, advise you on the best way to manage your expenses and labour costs and take responsibility for keeping your business running smoothly when it comes to income so you don’t have to.

In addition, having a professional in your workforce will substantially take the pressure off when your business grows faster than you might have anticipated. Not to mention the fact that you will have more time on your hands to focus on your original business idea and keep the quality of your service or product at the highest level possible.

Keep Personal and Business Expenses Separate

Mixing up your personal and your business expenses can be a very slippery slope that may leave you with more debt than profit. When starting up your small business it is best to open up a bank account for it right away that is separate from your personal account – this way you will not only be keeping your personal finances safe from any economic dents to your business but you will also be able to better keep track of your business’s exact income and expenses.

Having an account specifically for your business will also be very beneficial and easier to manage when it comes to tax issues and returns, allowing you to get more out of your overall business experience.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team

How to Choose an Accountant For Your Small Business

Small business owners often underestimate how challenging it can be to manage business accounts. They engage basic accounting packages and think that will be enough to manage all of their information. Unfortunately, handling business accounts isn’t that easy, even if your business is small or just getting off the ground. At CapexCPA, we encourage business owners to hire a professional accountant for the purpose. Here are some tips that will help you find the best fit for your company:

1. Look Into the Accountant’s Qualifications

The first step is to look into the accountant’s qualification. Most professionals in this field need to pass specific examinations and get certified by industry authorities. The official title of these experts can vary from country to country, but they're mostly referred to as Chartered Accountants, and they are highly qualified. You can find professionals who aren't chartered or certified but investing in them can be risky. They might not have complete knowledge about taxation, compliance, and other such regulations.

2. Consider the Accountant’s Location

Modern technology has made it easier for businesses to hire professionals from all over the world without issues. It is possible to hire an accountant from a different province or city, but it might not be a wise idea for your business. Small businesses have a strong local presence and need to comply with local laws.

They also need to pay taxes imposed by their local government. An accountant from another side of the country might not be able to provide the most accurate information. They might not be familiar with taxation and regulations applicable to your business. It is best to reduce the margin for error by asking every accountant you consider whether they can help you with all rules applicable to your business.

3. Level of Experience

Chartered accounts with a few years of experience behind them are more comfortable and confident. They can handle large accounts, changes in accounting systems, and higher volumes of data with greater ease. Seasoned professionals also have keener instincts and can provide better insight into the data. These accountants know how to navigate the taxation system and find legitimate ways to reduce your tax burden. When you’re hunting for accountants for your small business, look for experts who have some experience in the field.

4. Reputation In The Industry

The Internet has made it easier for people to get information on different professionals and experts. You can read online reviews, contact past clients, explore the accountant’s profile or website, and then make a decision to hire them. You can contact local industry authorities to see if the accountant has a good record or if there are any complaints against them.

It is also a good idea to set up a meeting with the accountant directly and discuss your requirements with them. The first consultation will help you determine whether you can work with the expert down the line.

If you have trouble managing your accounts or need professional assistance, don’t hesitate to get in touch with us at CapexCPA contact us or call 416 903 4040. 

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team