S & P Accounting Services

Why small business owners should have a business bank account

Are you still using your personal checking account to manage your business finances? Regardless of whether you own a home-based business or are building a multi-million dollar enterprise, there are several benefits to differentiating between your personal and business finances. In this article, we will discuss the following: The numerous reasons you should have a business bank account and how to open up a business bank account.

The reasons you should have a business account

Having a business account will ensure that you keep your business funds separate from your personal funds.

Here are some of the worthwhile reasons:

1. Having a business bank account gives your new business credibility and professionalism. This is particularly important if you have customers that pay with cheques. It definitely looks more professional when you ask your clients to write a cheque to  “XYZ Enterprise” as opposed to  “Bob Smith.” It also looks more business-like and credible when you use separate business cheques and a separate business credit card to pay suppliers and other companies for their services.

2. Having a business bank account is advantageous for tax purposes. Maintaining a separate business bank account will help you keep track of all your business-related transactions and will make it easier to pay your taxes when tax season rolls around. It will also provide you with a clear trail of your business revenue and expenses in case the CRA decides to audit you.

3. Although having a separate business bank account is advisable for businesses that are sole proprietorships or partnerships, it is especially recommended for corporations (more about these business structures later in this article).  A corporation refers to a business that is a separate and distinct entity from its owners and as such the personal assets of the owners are sheltered from potential liability.  However,  sometimes courts will hold the corporation’s owners, members, and shareholders personally liable for business debts. When this occurs, it’s called “piercing the corporate veil.” For instance, if the corporation has been utilized as an instrument of fraud and improper conduct, or was incorporated for no valid business purposes, then the court may deem the shareholders personally liable. One of the criteria which may be used to decide whether the court should “pierce the corporate veil” is the degree of separation between the financial activities of the business and those of the owners of the business. As such, it is vital that an incorporated company have a separate business bank account.

4. The most obvious reason to have a business bank account is that you will be able to keep track of your cash flow and to see if your business is profiting.  A business checking account ensures that all your business transactions are separate from your personal financial transactions. This helps you monitor your business’s profitability.  If you were to combine your personal financial transactions with your business financial transactions into one account, you might have a difficulty determining your profit margin because to determine your profitability, you must remember which expenses were personal and omit them.

How to open up a business bank account

There are three main steps to opening a business bank account: 1. choose a business structure, 2. decide on who will be the primary business representatives and 3. provide the bank with several critical documents.

1. Choose a business structure

Prior to setting up a business account, it is imperative to decide which type of business structure you will be running. Is it a sole proprietorship? partnership? or corporation?

In a nutshell, here are the differences between the three business structures:

  1. A sole-proprietorship refers to a business in which you are the sole owner and fully responsible for all debts and responsibilities related to your business. One of the advantages of this business structure is that all profits go directly to you. However, one of the disadvantages is that you are subject to unlimited liability which means that a creditor can make claims against your personal assets to pay off your business debts.
  2. A partnership refers to a business in which you and another individual or multiple individuals have a legal relationship to operate a business as co-owners. In a partnership, you and your business partner(s) combine your financial resources into the business. You and your partner(s) share the management, profits, and assets of the business as outlined by the legal agreement you have formulated. One of the benefits of this business structure is that there is a tax advantage. For instance, if income from the partnership is low or loses money, you and your partner(s) include your shares of the partnership in your individual tax returns. One of the disadvantages is that there is no legal difference between you and your business so similar to owning a sole-proprietorship,  you have unlimited liability.
  3. A corporation refers to a business entity that is separate from its owners. The majority of corporations have shareholders, and the shares are held only by a few individuals, or they may be available for sale to the public (publicly held). One advantage of this business structure is that as a shareholder of a corporation, you will not be personally liable for the debts, obligations or acts of the corporation.  One of the disadvantages of owning a corporation is that it is more expensive and time-consuming to set up than other business forms. We advise that you seek legal advice if you plan on incorporating.

If you’d like to read some of the advantages and disadvantages of having a sole-praetorship, partnership, and corporation, check out this article from Canada Business Network.

2.  Decide who will be your primary business representatives

Next, after you decide on a business structure, determine who will be the primary representative for your business. In other words, who will have the authority to sign on contracts, cheques as well as perform certain functions such as withdrawals, transfers, and payments on behalf of the company?

3.   Provide the bank with several critical documents

Typically, banks require that all owners and signing officers provide two pieces of approved personal identification.

Also, depending on your business’ legal structure, you will be required to provide additional documents to the business bank specialist. For instance, for each of the following business structures, you will need to provide the following documents:

Sole Proprietorship

– Certificate of Registration of Business Name

Partnership

– Certificate of Registration of Partnership. Partnership Agreement (if available)

Corporation

– Articles of Incorporation. Certificate of Registration of Business Name (if available).

-Most current filing with your incorporating jurisdiction listing your directors

-Trade Name Registration (if applicable)

An important note:  Please contact the bank that will be managing your business bank account to determine if you require additional documentation and what their exact procedures are for opening a business account.


If you require additional consultation or want to learn more about our professional accounting services, please do not hesitate to contact S & P Accounting Services.

Polina Presman, CPA, CA

T- 416-371-6017
F- 416-667-0404

Shani Marzin, CPA, CA

T- 416-731-9031
F- 416-667-0404

S&P Accounting Services LLP
2727 Steeles Ave. W. Suite 300
North York, ON, M3J 3G9
www.spaccountingservices.ca

Disclaimer: We strive to ensure all information on our site is accurate and up to date. However, the contents of the site are naturally subject to change from time to time. That means, we can’t always guarantee the accuracy of all information on the site. YOU ARE RESPONSIBLE FOR CHECKING THE ACCURACY OF RELEVANT FACTS AND OPINIONS GIVEN ON THE SITE BEFORE ENTERING INTO ANY COMMITMENT BASED UPON THEM.

This post was written by Biz Source, a content creation company and is for illustration purposes only. For professional advice, please contact S & P Accounting Services.

Five steps to creating a successful monthly budget

What is a monthly budget?

A monthly budget is a tool that helps you manage your money. It allows you determine how much money you are earning, spending and saving. Devising a budget can help you balance your income with your regular expenses and guide your spending habits to help you attain your monetary objectives.

Creating a budget can initially be overwhelming and a difficult feat, yet as you read through the following five steps, you’ll see that it’s feasible and definitely worth the effort.

What are the steps to creating a monthly budget?

Overall, the steps for creating a monthly budget are as follows: 1. Track your spending to determine where your money is going, 2. Divide your expenses into various categories, 3. Record your daily expenses, 4. Assess where you can cut your expenses and 5. Define your financial goals, make a plan and stick to it.

1. Track your spending to determine where your money is going. For a month or two jot down every single cent you spend, yes even that $3.75 caffe latte you sip at your daughter’s ballet practice and the chow mein meal you devour after dancing the night away with your girlfriends.  

At the end of the month add the total expenditures and subtract this total from your net earnings to see whether or not you’ve spent more than you’ve earned. This calculator will show you how seemingly inconsequential purchases can add up over time.  For instance, if you spend $2.50 on a daily coffee, it will cost you more than $900 per year.   On the flip side, if you make small changes to your spending habits, such as reduce the amount of coffee you buy, this minor change can have a positive effect on your budget and your ability to save.

2. Examine what you spend money on during the 1 to 2 month period and divide your expenses into various categories. You could divide your expenses into broad categories such as housing, car, food, and then set up sub-categories within them. For instance, under the category housing, you could further divide it into mortgage payments, rent, utilities, and repairs.

3. Consistently keep a tab of your daily expenses. Write down all your purchases on a Post-it Note and keep it conveniently in your wallet. Then when you get home, transfer your purchases to an excel spreadsheet or a budget app. Here is an excellent budget calculator worth checking out.

4. Assess where you can cut your expenses. This is where the real fun begins. It’s now time to examine each category (see step 2) and determine where you can trim your expenses. You may be surprised by the seemingly minor purchases that are eating away at your credit card, such as the extra $50 you rack up at the grocery store simply because you are purchasing food when you are hungry or not adhering to a grocery list.  Carefully review your spending habits and devise a list of items to par.

The accompanying activity might help you figure out which spending to cut from your budget. Divide your expenses into two classes: “needs” (e.g., groceries and utilities) and “wants” (e.g., tickets to a show). Assess your needs and wants. A need is something that is important, required or fundamental. For instance, a roof over your head, heat for your home, nourishment, clothing or medicine. On the contrary, a want is something that you’d like, however, don’t really require. Dinners at restaurants, coffee from Second Cup, tickets to a concert, a gym membership or designer clothes and shoes are examples of wants. Needs and wants aren’t the same for everybody. One individual’s want might be someone else’s need. Let me explain. If for instance, you live in a metropolitan area near a bus route, a car may be more of a want rather than a need. On the other hand, if you live in the suburbs, and don’t easily have access to public transportation or can’t walk or cycle to work, a car may be a need.

Some suggestions on how to cut your expenses include: borrowing books from your local library instead of buying them on Amazon; borrowing movies from the library instead of going to the movie theatre; running or walking outside instead of purchasing a gym membership;  getting rid of one car and relying on public transportation; using the washer and dryer during off-peak hours; and shopping at discount food stores or using the app Flipp, which could help you price match and save on weekly food essentials. These changes no matter how small may save you hundreds or even thousands of dollars each year.

5. Define your financial goals, make a plan and stick to it. Creating a budget won’t magically transform your spending behaviour.  You will need to consistently monitor your spending and define your goals and priorities and stick to them. Monitoring your spending could be done by consistently writing down your weekly budget and reviewing it to see if you are spending less than you earn.  Whereas defining your goals involves sitting down and reflecting on where you want to be financially in a year, three years or five years from now. One important goal you should consider is to increase the amount of money you deposit into your savings account each year.  Yet, this goal should be a priority only after you have paid off your debts because it won’t make sense to put money away while you are paying interest on your debts. Other goals that are worth attaining include setting up an emergency fund, paying off your mortgage in x amount of years or saving money for your children’s post-secondary school education. 

What are some tips that could help you to adhere to your budget?

  1. Minimize your spending behaviour as much as possible to what is in your budget. try to stick to buying products and services that are needs rather than wants.
  2. Record your receipts and bills in your budget app or excel spreadsheet.
  3. List your income and expenses and compare the two at the end of the month to see if you are spending more than you earn.
  4. Evaluate your monthly budget to see if you are your spending greatly differs from your budget. If this is the case, you may need to reevaluate the figures to make it more sensible and realistic.
  5. When contrasting your budget with your actual spending, ask yourself the following:
    1. Are there huge or little differences between your actual spending and budget?
    2. Which categories have the biggest differences?
    3. Are differences due to an atypical circumstance (e.g., repairing the washer) or is this prone to happen every month?
    4. Are you able to save enough money to achieve your financial objectives or pay off your debts?
    5. Continue to reflect on your spending behaviour and to ask yourself these above questions every month.
    6. You are going in the right direction if your spending differs a bit from your budget.

Are you looking for more info on how to make smarter financial choices?

A great resource to check out is MyMoneyCoach.ca.

MyMoneyCoach.ca is a free public service provided by the Credit Counselling Society (CCS). The Credit Counselling Society is a non-profit, government registered, charitable organization dedicated to helping individuals and families find solutions to their debt and money problems. CCS provides consumers with confidential and free counselling services, credit education, and debt management programs.

Source: https://www.canada.ca/en/financial-consumer-agency/services/make-budget.html


About S & P Accounting Services

S & P Accounting Services is a professional accounting firm situated in North York, Ontario. We are chartered accountants with extensive experience with audit, review, tax and bookkeeping. We strive to operate in accordance with our principles of quality, professionalism, and integrity and are dedicated to excellent service.  We aim to ensure that our clients receive the highest quality of financial, tax and accounting services and advice. We happily serve clients in Toronto, North York, Mississauga, Vaughan, Richmond Hill and in other cities in the GTA.

If you have any questions or inquiries about our accounting services, please contact S & P Accounting Services.

S&P Accounting Services LLP
2727 Steeles Ave. W. Suite 300
North York, ON, M3J 3G9
www.spaccountingservices.ca

Disclaimer: We strive to ensure all information on our site is accurate and up to date. However, the contents of the site are naturally subject to change from time to time. That means, we can’t always guarantee the accuracy of all information on the site. YOU ARE RESPONSIBLE FOR CHECKING THE ACCURACY OF RELEVANT FACTS AND OPINIONS GIVEN ON THE SITE BEFORE ENTERING INTO ANY COMMITMENT BASED UPON THEM.

This post was written by Biz Source, a content creation company and is for illustration purposes only. For professional advice, please contact S & P Accounting Services.

How to budget wisely – top five tips from an accounting firm

S & P Accounting Services is an accounting firm situated in the Greater Toronto Area. A common question that our clients ask us is how could I budget wisely?

Overall, the top five tips that we recommend to our clients are:

1. Spend less than you earn. 

This is easier said than done, yet if you follow through with this, you could be well on your way to paying off debts, saving for your retirement, getting your hands on that next generation Macbook or buying that beautiful home you dreamed of.

2. Create a monthly budget and adhere to it.

In order to know how much money is coming in and out each month, it is essential to devise a budget. There are different smartphone apps that make it easy to track your expenditure such as, Mint.com, YNAB, or Freshbooks. Conversely, you could simply create a monthly budget on excel spreadsheet for free.

Creating a monthly budget could definitely be an eye opener for you.  It will allow you to see how much money you are spending on those sushi outings with friends or daily Starbucks fixes and may propel you to want to change your spending habits.

3. Pay with cash instead of credit cards.

A good way to reduce your spending is to pay your daily expenses with real cash instead of credit cards. Cash offers a real tangible experience. When you run out of cash in your wallet, you no longer have any more money to spend. “You see this and process it.” On the contrary, with credit cards, “it seems like it would be easier for someone to purchase more because a card, while tangible, does not represent actual money. It’s just a piece of plastic, and a shopper does not see the result of their expenditure for almost a month.”1


One well-documented study conducted by Dun & Bradstreet found that people spend 12-18% more when purchasing with credit cards instead of cash. McDonald’s reports that when customers purchase with credit cards, the average ticket is $7 as opposed to $4.50 with cash. Therefore, we advise that it is best to keep cash rather than credit cards in your wallet.2

4. Stick to your grocery list and brown bag your lunch.

Having a grocery list will save you money and time. Have you ever rushed to the grocery store two days in a row simply because you forgot that one important staple on your first trip to the grocery store?  Or have you ever gone to the grocery store wandering aimlessly through the aisles, with little knowledge of what you have in your pantry and fridge and ended up buying multiples of the same product?

Having a grocery list will remind you what you need to buy and will ensure that you are purchasing food you know you will eat. Unfortunately, people throw away too much money on food because they purchase it and never eat it, or it gets moldy or rotten. Purchasing food that you intend to consume because it’s on your grocery list will help minimize wasted food.

A good way to create a grocery list is to first create your meal plan for the week.  After completing your meal plan, write down the necessary ingredients on your grocery list. Make sure to take note of what you already have in your fridge and pantry in order to avoid buying duplicate items.

One meal planning app worth checking is Today’s Parent Mealtime. It could help you create a weekly meal plan from thousands of family-friendly recipes and then create a grocery list that you could email to family members so that you are all on board with what’s needed.

We also recommend that you brown bag your lunch. This will save you hundreds or even thousands of dollars per year and as an added bonus it is usually healthier to eat a homemade meal.

5. Don’t buy on impulse.

Consumer psychologist, Ian Zimmerman, Ph.D., points out that “impulse buying is related to anxiety and unhappiness…The impulse buyer may feel unhappy and may think that being seen with an expensive new purchase will bring respect and happiness. This perceived road to happiness motivates the impulse buyer to go shopping…likes [a] product, and experiences pleasure at the thought of being able to purchase it immediately and go home with it.”3

Therefore, when you are down in the ruts, don’t use shopping as a therapy to give you a quick pick me upper. Instead try to find different avenues to deal with frustrations, boredom, and fatigue such as meditation, exercising, writing, drawing which are all practically free. One technique that could help you avoid impulse shopping is doing deep breathing exercises. You are window shopping with no intention of buying anything and you see those new Nike shoes and want them like now…”Take a breath and try this instead: Tell yourself you can buy it, but not until next month. By then, you’ll either have enough saved up or you’ll decide you don’t like it that much after all. Even better, if you wait it may be on sale! Problem solved.”4

In the same vein, when you go grocery shopping, stick to the items on your grocery list and never shop hungry.

Related: What motivates impulse buying

In conclusion, in order to budget wisely and help achieve your financial goals, it is well worth it to follow these five tips: 1. spend less than you earn, 2. create a monthly budget and adhere to it, 3. pay with cash instead of credit cards, 4. stick to your grocery list and brown bag your lunch, and 5. don’t buy on impulse.

Sources:

https://www.nerdwallet.com/blog/credit-cards/credit-cards-make-you-spend-more/

http://www.businessinsider.com/studies-help-explain-why-credit-cards-make-us-spend-more-2014-7

https://www.psychologytoday.com/blog/sold/201207/what-motivates-impulse-buying

https://www.everydollar.com/blog/8-steps-to-help-you-stick-to-your-budget

 


About S & P Accounting Services

S & P Accounting Services is a professional accounting firm situated in North York, Ontario. We are chartered accountants with extensive experience with audit, review, tax and bookkeeping. We strive to operate in accordance with our principles of quality, professionalism, and integrity and are dedicated to excellent service.  We aim to ensure that our clients receive the highest quality of financial, tax and accounting services and advice. We happily serve clients in Toronto, North York, Mississauga, Vaughan, Richmond Hill and in other cities in the GTA.

If you have any questions or inquiries about our accounting services, please contact S & P Accounting Services.

S&P Accounting Services LLP
2727 Steeles Ave. W. Suite 300
North York, ON, M3J 3G9
www.spaccountingservices.ca

Disclaimer: We strive to ensure all information on our site is accurate and up to date. However, the contents of the site are naturally subject to change from time to time. That means, we can’t always guarantee the accuracy of all information on the site. YOU ARE RESPONSIBLE FOR CHECKING THE ACCURACY OF RELEVANT FACTS AND OPINIONS GIVEN ON THE SITE BEFORE ENTERING INTO ANY COMMITMENT BASED UPON THEM.

This post was written by Biz Source, a content creation company and is for illustration purposes only. For professional advice, please contact S & P Accounting Services.

Here are some FAQs about income tax returns

Here are answers to some commonly asked questions about income tax returns

1. What income do I need to report on my income tax return?

All income is taxable. You’ll need to report all income on your tax return (also known as Income Tax and Benefit Return) and calculate how much tax you owe.

Income that you must report to the CRA (Canada Revenue Agency) includes:

  • Part-time and self-generated income
  • Employment income earned both inside and outside of Canada
  • Income from rental property or renting out a section of your house
  • Investments (e.g. interest, dividends, capital gains)
  • Being self-employed (e.g. a home business)
  • Your pension
  • Income from more than one job

2. Do I qualify for tax credits and benefits?

You may qualify for the following:

  • Ontario Children’s Activity Tax Credit
  • Ontario Political Contribution Tax Credit
  • Healthy Homes Renovation Tax Credit
  • Ontario Trillium Benefit
  • Ontario Senior Homeowners’ Property Tax Grant
  • medical expenses, caregiver amounts, disability amounts, etc.

All you need to do is file a tax return and fill in three forms ON 479, ON-BEN and ON 428.

If you are submitting a paper tax return form, complete and mail the forms below when you mail your tax return.

Yet, if you are submitting your tax return online, the majority of accounting and tax return software will automatically ask you questions related to tax credits and benefits.

3. What if I have no income from last year, do I still file a tax return?

It’s important to file your taxes even if you have no earnings.

Even if you don’t have an income from the previous year, it’s beneficial to file your taxes because you may be eligible for various government benefits such as, the Ontario Trillium Benefit, the Ontario Child Benefit and Healthy Smiles Ontario.

However, please note two cases which it is mandatory to file an income tax return even though you have no earnings from the previous year: 1. if you owe taxes to the government and 2. if the CRA sent you a request in the mail to file your taxes.

4. Will I receive a refund?

The CRA will process your tax return and mail you a notice of assessment. If you qualify for a refund, you’ll get money back.

How much money you receive is contingent on a number of factors: your location, age, the size of your family, how much money you make and your expenses. Not everyone qualifies for a refund.

If you owe the CRA money, you will receive a letter in the mail stating that you need to pay by April 30. You can pay online, at your bank, or by mail with a cheque or money order.

5. From where do I get a tax return form?

To get a tax return form, you can either:

  • Download one from the CRA website
  • Visit your local post office or postal outlet
  • Visit a Service Canada office
  • Call 1-800-959-8281

The tax return forms are available at the above locations between February and early May.

6. Can I get help completing my tax return?

You may be eligible to get help from a free tax preparation clinic if you have a modest income and a simple tax situation. These tax clinics are offered through the Community Volunteer Income Tax.

Remember to bring your tax information slips and receipts such as old age security (OAS), employment insurance (EI) and Canada pension plan (CPP) tax slips. Volunteers will need them to prepare your income tax.

If you do not qualify for free tax services, you can get help from an accountant or a tax preparation company.

Our professional chartered accountants are committed to assisting you with your tax return and are highly qualified at finding the best tax credits and deductions that will maximize your refund from the government. Here is some more information about our professional accounting services. If you have any questions about tax returns or any accounting related inquiries, please contact S & P Accounting Services.

Here is an infographic which provides answers to some commonly asked questions about income tax returns. 

Income tax return FAQs

Income tax return infographic

S&P Accounting Services LLP
2727 Steeles Ave. W. Suite 300
North York, ON, M3J 3G9
www.spaccountingservices.ca

Disclaimer: We strive to ensure all information on our site is accurate and up to date. However, the contents of the site are naturally subject to change from time to time. That means, we can’t always guarantee the accuracy of all information on the site. YOU ARE RESPONSIBLE FOR CHECKING THE ACCURACY OF RELEVANT FACTS AND OPINIONS GIVEN ON THE SITE BEFORE ENTERING INTO ANY COMMITMENT BASED UPON THEM.

This post was written by Biz Source, a content creation company and is for illustration purposes only. For professional advice, please contact S & P Accounting Services.

Are you looking for a tax accountant in Toronto to help you with your tax return?

You may be eligible for free tax services

If you are looking for a tax accountant in the Toronto or North York area, yet have a simple tax situation and modest income, you may be eligible for free tax services.

In fact, there are many community organizations throughout Canada that have volunteers completing tax returns for eligible individuals. These tax clinics are made feasible through the Community Volunteer Income Tax Program (CVITP).

You might qualify for theses services if you have a modest income and a simple tax situation.

1. What is a modest income?

Modest income means that your family income is less than the amount shown in the chart below. Verify with the community organization in your vicinity to see if you are eligible as some organizations have different eligibility requirements. 

Family size Total family income
One person $30,000
One person with one dependant $35,000 (add $2,500 for each additional dependant)
Couple $40,000 (add $2,500 for each dependant)

2. Do you have a simple tax situation?

In general, your tax situation is simple if you have no income or if your income comes from these sources:

  • employment
  • pension
  • benefits such as CPP, disability, CCB, EI, social assistance
  • RRSP
  • support payments
  • scholarships, fellowships, bursaries or grants
  • interest (under $1,000)

Your tax situation is not simple if you:

  • are self-employed or have employment expenses
  • have business or rental income and expenses
  • have capital gains or losses
  • file for bankruptcy
  • are completing a tax return for a deceased person

In such circumstances, you may wish to seek advice and assistance from a tax accountant.

3. When are these free tax services offered?

Volunteer tax preparation clinics are generally offered each year between February and April but many are operating all year at various locations across Canada.

4. Where are the tax preparation clinics located?

Here is a list of free tax preparation clinics in:

5. What to bring to the tax preparation clinic?

 In order for volunteers to complete your income tax and benefit return for you, make sure to bring your:

  • Tax information slips
  • Receipts
  • Social Insurance Number
  • Identification

Volunteers need the above items to prepare your income tax and benefit return.

7. How do you get your slips?

You can visit Service Canada‘s secure site to get access to your current year and prior year old age security (OAS), employment insurance (EI) and Canada pension plan (CPP) tax slips electronically. 

For more information, see Information slips – T4 and other slips.

8. What if I require assistance with my taxes and don’t qualify for assistance from one of the free tax clinics?

If you require assistance with your taxes and are not eligible for assistance from one of the free tax clinics, you may contact S & P Accounting Services. We are a full-service accounting firm handling taxation, bookkeeping, payroll and accounting. We happily serve clients in North York, Toronto, Vaughan, Mississauga, Richmond Hill and other cities situated in the GTA. If you require consultation or a have any accounting inquiries, please do not hesitate to contact us.

Polina Presman, CPA, CA

T- 416-371-6017
F- 416-667-0404

Shani Marzin, CPA, CA

T- 416-731-9031
F- 416-667-0404

S&P Accounting Services LLP
2727 Steeles Ave. W. Suite 300
North York, ON, M3J 3G9
www.spaccountingservices.ca

Disclaimer:

We strive to ensure all information on our site is accurate and up to date. However, the contents of the site are naturally subject to change from time to time. That means, we can’t always guarantee the accuracy of all information on the site. YOU ARE RESPONSIBLE FOR CHECKING THE ACCURACY OF RELEVANT FACTS AND OPINIONS GIVEN ON THE SITE BEFORE ENTERING INTO ANY COMMITMENT BASED UPON THEM.

This post was written by Biz Source, a content creation company and is for illustration purposes only. For professional advice, please contact S & P Accounting Services.

 

 

We offer bookkeeping services in the GTA

We offer bookkeeping services in the GTA

Whether you have a start-up business or a well-established business, S&P Accounting could provide you with professional bookkeeping to meet your business needs. We offer bookkeeping services to clients in the GTA which includes Toronto, North York, Thornhill, Vaughan and Richmond Hill.

We provide a full range of bookkeeping services 

Our bookkeeping services include:

  1. Books set-up,
  2. Data entry, banking, and reporting,
  3. Payroll setup, processing, monthly remittances and yearly tax reporting,
  4. HST, WSIB and Employer health tax filings….and more.

Our bookkeeping services are highly professional

In Canada, bookkeeping, unlike the accounting profession, is completely unregulated. This means that when it comes to bookkeeping, there are no criteria for educational credentials or for professional conduct. Virtually anybody with little to no education or training could call themselves a bookkeeper. Unfortunately, using the service of an unqualified bookkeeper, has had detrimental consequences for businesses. For instance, according to Edward Nagel, a forensic accountant,  unethical bookkeepers could create “large-scale misappropriation — from fictitious vendors and ghost employees to cheque fraud, and everything in between. And, since many bookkeepers and their employees often have no formal fraud-prevention training, this increases the likelihood of a fraud going undetected for months, if not years. ” Mr. Nagel proceeds to say that it’s important to stay clear of bookkeepers that profess to be knowledgeable in the profession, yet refuse to answer straight-forward accounting questions. That’s definitely a red flag!

At S & P Accounting Services, our Chartered Accountants perform the bookkeeping services.  This means that our high level of educational, professional and ethical standards ensures that our clients receive top level bookkeeping services. As our client, you could feel confident knowing that our Chartered Accountants will ensure that your books are properly maintained. We will accurately and proficiently perform all your bookkeeping services, as well as give you advice and answer any questions that you may have about your business’ finances. Our qualified bookkeepers are able to customize a bookkeeping solution around your financial and business needs.

We offer bookkeeping services in both QuickBooks and Simply Accounting, and we offer these services at your office or ours, whatever you prefer. Our office is conveniently located in the the GTA.

Our bookkeeping services are affordable and efficient

Our bookkeeping services are an affordable and efficient way to get small and large sized businesses up-to-date with their bookkeeping records. We regularly look over your file and help ensure that your books are properly and accurately maintained. By providing you with professional bookkeeping services, you will have more time to focus on what’s really important -running your business.

If you require additional consultation or a have any bookkeeping inquires, please do not hesitate to contact us. We serve clients in Toronto, North York, Vaughan, Thornhill, Richmond Hill, and all other GTA cities.

Polina Presman, CPA, CA

T- 416-371- 6017
F- 416-667-0404

Shani Marzin, CPA, CA

T- 416-731-9031
F- 416-667-0404

S&P Accounting Services LLP
2727 Steeles Ave. W. Suite 300
North York, ON, M3J 3G9
www.spaccountingservices.ca

The benefits of good business accounting services

Good Business Accounting Will Help You Focus on What’s Important…Your Business

Professional business accounting services can save you money and time, but that is not all. A good accountant can also help you make more money, grow your business and avoid bad business decisions. Here is how:

Good business accounting services help save on taxes

If you are in any way similar to the typical business owner, you may be paying more tax than you should. A good accountant will make sure that you are reporting all the right business expenses without missing any opportunity to lower your tax bill. A good accountant will also find ways to structure your return, in compliance with the regulations, in a way that will minimize your taxes. The time invested in finding a good accountant can save you thousands in taxes. Note that tax laws are changing all the time and what worked for you last year may not be effective or even allowed this year. A good accountant will be up to date with the latest changes.

You won’t pay unnecessary fees and penalties

Once you’ve found a reliable business accounting service, you can relax knowing that your accountant keeps a watchful eye and won’t let you fall behind on your payment to government agencies and regulatory bodies. This will not only save you from unnecessary payments, but also from the unpleasant and restrictive effects of penalties for late payment.

You’ll save time on bureaucratic stuff

As a business owner you are probably less familiar with the accounting world than you are with your own business. This can become a time consuming issue in situations when you need to fill out specific forms, apply government programs or just deal effectively with CRA. Your accountant can save you precious time by helping you with these issues.

Your business will grow faster and safer

An experienced accountant may have already seen businesses in situations that are somewhat similar to yours. Your accountant has intimate knowledge of the financial aspects of your business and can help you evaluate new opportunities probably better than other advisors can. A good accountant should have the ability to analyze those opportunities from a cold, financial perspective that you may not have as someone who is deeply involved. Your accountant can help you identify opportunities for growth as well as those that need to be avoided.

If you require additional consultation or a tax planning strategy, please do not hesitate to contact us. We serve clients in Toronto, North York, Vaughan, Thornhill, Richmond Hill, and all other GTA cities.

Polina Presman, CPA, CA

T- 416-371- 6017
F- 416-667-0404

Shani Marzin, CPA, CA

T- 416-731-9031
F- 416-667-0404

S&P Accounting Services LLP
2727 Steeles Ave. W. Suite 300
North York, ON, M3J 3G9
www.spaccountingservices.ca

The role of a good small business CPA

A good small business CPA will provide its clients with advice beyond the areas of tax preparation and auditing

Many of our clients are small business owners. Even those who own big companies started a few years ago as small business owners. Small business is the backbone of our Canadian economy and should be treated as such. Therefore, A good small business CPA will provide its clients with advice beyond the areas of tax preparation and auditing, and will also help its clients capture the many business opportunities that are available to them in order for the maximize their profitability and reduce their liabilities.

Good small business CPA provide clients with advice in areas that are beyond tax preparation and auditing

In our role as a small business CPA, we meet many clients who can benefit from advice in areas that are beyond tax preparation and auditing. Many business owners can increase their profitability through a better understanding of how cash flows in their business, the true value of different business opportunities and the true value of assets and liabilities. For instance, the type of business structure you choose to have, whether it is a proprietorship, partnership, or corporation  will impact how you report your business income, the type of returns you have to complete, and many other aspects of your business. A good CPA will advise you on which business structure is most suitable for your business and the benefits that you are eligible for and how to increase your profitability.

Good small business CPA help clients capture business opportunities

A small business CPA should also help business owners capture opportunities for increasing profits that are not always so obvious to the untrained eye. An accountant has the advantage of having the full perspective of the financial situation of the business as well as the experience of dealing and improving different business situations for its clients. For instance, the following is one example of how a small business CPA could help clients improve their business situation. The Federal Budget 2017 has made changes to the way business professionals will report work in progress (WIP) on their income. This policy could mean that professionals such as lawyers, doctors, accountants, veterinarians, and chiropractors will have to pay more taxes upfront and stain their cash flow.  In order minimize this strain on business professionals income,  a good CPA will advise such professionals on the different options that are available to them.  Such recommendations  could include how they could change the way their WIP is calculated, the benefits of incorporating their practice, the advantage of creating a holding company for excess cash, as well as the value of splitting income with family members.  A good small business CPA will be well versed in the federal policies in place and will know which options are best for its clients in order to maximize opportunities and minimize any strain on their income so that the could carry on business as usual.

We believe that as a small business owner you can expect your CPA to give you this level of consulting.

If you require additional consultation or a tax planning strategy, please do not hesitate to contact us. We serve clients in Toronto, North York, Vaughan, Thornhill, Richmond Hill, and all other GTA cities.

Polina Presman, CPA, CA

T- 416-371- 6017
F- 416-667-0404

Shani Marzin, CPA, CA

T- 416-731-9031
F- 416-667-0404

S&P Accounting Services LLP
2727 Steeles Ave. W. Suite 300
North York, ON, M3J 3G9
www.spaccountingservices.ca

A Tax Accountant shares the nitty gritty of being tax audited

As a Tax Accountant, I believe that it is my responsibility to reduce the chances of my clients being audited.

In fact, being audited can be overwhelming and it is definitely something you’d want to avoid. In this article, I explain, Why CRA audits? and What a tax audit is?

Why does CRA audit?

Canada Revenue Agency (CRA) is responsible for administering tax and benefit programs for all Canadians.  In order to ensure that the tax system is fair for everyone and that all Canadians receive the benefits and amounts that they are eligible for, the CRA audits businesses that may not have calculated their taxes correctly. In fact, the Canadian tax system relies on self-assessment. This means individuals register their business as applicable and at the end of the year or at the end of the reporting period, individuals calculate their own taxes and submit a tax return to the CRA along with any payments required. So the auditing is one way to ensure that businesses fulfill their obligations and receive any amounts and benefits that they are eligible for.

What is a tax audit?

When CRA receives a tax return it typically goes through an initial processing that checks basic information and calculates the information. From this initial processing, you receive a notice of assessment

A tax audit, on the other hand is a more detailed examination of your books and records. Records are financial documents that sum up your transactions and include documents to support these transactions. A tax audit is conducted after you’ve received your notice of assessment to find out if you’ve calculated your taxes correctly.

While undergoing a tax audit, the CRA first reviews the income and expenses you’ve reported. GST registrants might be more familiar with the terms supplies and input tax credits.

Next, the CRA may compare the income and expenses you’ve reported with other sources they have on file in order to affirm that you’ve followed the tax laws and that your calculations are accurate.

During this time, CRA also checks to see that you’ve reported revenues from all sources and that the expenses you claimed are deductible and supported by receipts. For GST/HST audits, CRA ensures that GST/HST is collected and reported on all taxable supplies, that you are entitled to the input tax credits you’ve claimed and that you have receipts to support your claims.

Finally, at the end of the audit, CRA will send you a letter and affirm one of three things.

1) that the previous Notice of Assessment was correct and nothing more needs to be done, or 2) that an adjustment needs to be made in more tax (reassessment) and you will have to pay the balance owing or 3) that an adjustment needs to be made, resulting in less tax (reassessment) and you will qualify for a refund. In most cases, audits result in a reassessment with mores taxes being owed to the Government of Canada.

If the adjustment results in more taxes being owed, the auditor can provide you with an approximation of the balance owing before the CRA issues a notice of assessment or notice of reassessment. This will give you the chance to prevent more interest charges from accruing by paying all or part of what you owe immediately. For more information, go to Make a payment to the Canada Revenue Agency.

I believe that a good Tax Accountant reminds clients of their responsibilities and requirements as tax-paying citizens. Businesses are obligated to to meet registration, reporting, filing and payment responsibilities which are written under the CRA laws.

Specifically, this means that you must keep your books and records up to date and generally for six years from the day that you file your tax return. You must also keep your books and records in an accessible and readable format either on paper or electronically.  Lastly, you must also provide your books and records and supporting documents to the auditor upon request.  All these steps will help reduce the chances that you will be audited and help ensure that you report your taxes correctly.  

If you require additional consultation or a tax planning strategy, please do not hesitate to contact us.

Polina Presman, CPA, CA

T- 416-371-6017
F- 416-667-0404

Shani Marzin, CPA, CA

T- 416-731-9031
F- 416-667-0404

S&P Accounting Services LLP
2727 Steeles Ave. W. Suite 300
North York, ON, M3J 3G9
www.spaccountingservices.ca

Source:

http://www.cra-arc.gc.ca/tx/bsnss/tpcs/lf-vnts/dt/menu-eng.html

A Chartered Accountant advises parents on how children could become more financially literate

As a Chartered Accountant, many of my clients ask me how they could help their children become more financially literate.

As a Chartered Accountant and parent, I could understand why they are concerned. Being financially literate is a life skill that children will carry with them even after high school. They need this knowledge in order to responsibly file their tax returns, help pay off debts and credit cards and save for their future. Lacking financial skills could definitely lead to financial troubles.

The good news is there are many different initiatives across Ontario that are helping children and youth gain money skills. For instance, the Ontario Ministry of Education is engaged in a pilot project that is helping revamp the Grade 10 careers courses and is laying the groundwork for financial literacy to become part of the curriculum for the fall of 2018.

Also, findings released this week by the Organisation for Economic Cooperation and Development (OCED) reveal that Canadian youth are among the top global performancers in financial literacy. Canada came second in financial literacy out of 15 countries that participated in the Programme for International Student Assessment (PISA) survey. Eighty-seven per cent of about 3,400 Canadian students who participated in the survey, demonstrated at least a baseline level of financial literacy and Twenty-two per cent of Canadian students demonstrated advanced levels of financial literacy, well above the OECD average.

What could you as parents do to help your children gain money skills?

I recommend talking with your children about money early on and doing so as often as possible. In fact, the PISA survey revealed that Canadian students who discussed money issues with their parents tended to score higher with those discussing money issues at home once or twice a week scoring the highest.

As a Chartered Accountant, from my experience, it is also beneficial for parents to encourage their youth to start handling money early on that way the youth gain greater practical knowledge on how to budget, save and spend wisely. In fact, the PISA survey found that Canadian teenagers who held occasional jobs like gardening and babysitting had, on average  the highest financial scores. Children and youth learn about money by doing. Here is an example of about 100 summer jobs for teens, one of them might peak your children’s interest.

What unbiased resources are out there that could help us parents discuss money matters with our children?

Chartered Professional Accountants Canada (CPA) offers free unbiased financial literacy sessions to the general public. The program is run by Chartered Accountants that volunteer their time and expertise and is available to adults, seniors, workplace, new Canadians, schools, post-secondary students, small and medium businesses and entrepreneurs. For instance, some of the topics that parents could learn at the sessions are how to teach their kids to be money-smart and how to become good financial role models for their children. If you are interested, you may request  a session here.

Another informative website is Teaching Children About Money which offers many programs and activities for youth and children. Some topics discussed are:  “What to consider when deciding to give an allowance: how much to give, how often to give and if it should be earned” as well as “What to teach your preschool, school-aged, preteen and teenaged children about money management.”

There is a also a Financial Literacy Database for Canadian parents which offers some educational and fun resources such as how to teach children about money management in a fun and interactive way, how parents could save for their children’s education and an e-book on how children could learn to be smart spenders.

Also, besides teaching children and youth about the value and importance of money and helping them take on seasonal jobs early on, it is important for parents to attend financial literacy workshops. Such workshops will give parents more confidence in their knowledge and skills about money, help them be better role models when it comes to handling money and make them feel more comfortable to initiate such conversations at the dinner table.

If you require additional consultation or a tax planning strategy, please do not hesitate to contact:

Polina Presman, CPA, CA

T- 416-371- 6017
F- 416-667-0404

Shani Marzin, CPA, CA

T- 416-731-9031
F- 416-667-0404

S&P Accounting Services LLP
2727 Steeles Ave. W. Suite 300
North York, ON, M3J 3G9
www.spaccountingservices.ca

Sources:

https://www.thestar.com/news/gta/2017/03/23/ontario-launches-plan-to-teach-high-school-kids-financial-skills.html

https://www.cpacanada.ca/en/the-cpa-profession/financial-literacy/financial-literacy-program-faqs

http://theprovince.com/opinion/op-ed/opinion-canadian-students-among-top-global-performers-in-financial-literacy

https://itools-ioutils.fcac-acfc.gc.ca/RDCV-BRVC/sear-rech-eng.aspx

https://www.thepennyhoarder.com/jobs-making-money/100-summer-jobs-for-teens/

https://www.canada.ca/en/financial-consumer-agency/services/teaching-children-money.html