Paying attention to your bookkeeping and accounting is a crucial factor when it comes to the success of your business. Whether your business is small or big, keeping a record of your financial transactions not only helps to track the flow of money but may also reduce the chances of getting audited by CRA.
Most business owners downplay the importance of an accountant and the need to hire one, by falling prey to some myths related to accounting. Hence, we’ve debunked three myths about book-keeping which may change your opinion about the need to appoint an accountant.
Myth 1: Bookkeeping and accounting are expensive.
For a business owner, time is very important. The time you spend on doing your own bookkeeping can be used to grow your business. An experienced bookkeeper or accountant could be more efficient and help you save money by doing it.
Myth 2: My tax return has been professionally prepared therefore CRA won't audit me.
While this might reduce your chance of being audited, it won't be absolute guarantee. CRA is getting more aggressive and will audit anyone. However, your accountant can help answer CRA correspondence and make it less stressful.
Myth 3: GST paid on a meal is 100% claimable as Input Tax Credit (ITC).
Most business owners assume GST paid on a meal is 100% claimable as Input Tax Credit. However, in reality, you can claim only 50% of the GST for a meal. Instead of manually calculating 50% of GST each time, an accountant could make things simpler by adding sales tax in accounting software for all meals.
At MR Fournier CPA, we make accounting and taxation simple, thereby allowing our clients to focus on what they love to do instead of worrying about the latest tax regulations, payroll updates, or bookkeeping rules. We help our clients with their personal taxes, retirement planning, small business bookkeeping, payroll including T4 preparation, GST/PST returns, financial statements preparation and corporate tax return. If you have any bookkeeping or accounting queries, contact us here.