5 Tips To Prepare For Tax Season
Updated: Oct 2, 2022
The arrival of tax season might be inevitable, but it’s also a source of stress for many business owners. You can make tax season easier and help minimize your tax burden with careful planning and advice. But where should you start? The following tips can help you to keep your business organized at tax time—and throughout the year.
1 - How do I stay on top of taxes throughout the year?
As with all tax matters, keeping accurate records is essential. Here are some tips to keep your tax information organized and up to date:
Keep your business and personal finances separate.
Keep receipts to support your income, expenses, and deductions.
Track your income monthly.
Work with an advisor to ensure you have the optimal tax structure for your business.
Assume all CRA correspondence is time-sensitive—don’t wait to open those envelopes!
Set recurring reminders in your calendar for all tax matters.
Regardless of your business’s size or structure, know all applicable tax deadlines and file on time—many people aren’t aware that the penalties and interest can add up to as much as the taxes you owe.
2 - How do I know I’m claiming everything I should be?
Some of the most common business expenses include the following:
gross salaries and wages, plus benefits
direct costs, including raw materials, shipping, and contractors
rent and utilities
office and business supplies
travel and entertainment expenses
Claiming expenses isn’t a one-size-fits-all formula, so it’s best to work with your Grant Thornton advisor to help maximize your tax deductions.
3 - How has COVID-19 affected the 2021 tax season?
Many small businesses continue to face challenges as the pandemic continues. The federal government introduced several programs to support businesses, including the following:
Canada Recovery Benefit (CRB)
Most of the federal support programs generate taxable income and have specific filing deadlines, so it’s best to work with your advisor to determine what program(s) best suit your business’s current and ongoing needs. We closely monitor these programs and will continue to share additional updates and insights on our website: www.grantthornton.ca.
4 - Can technology help with tax planning?
I get it—tax administration and planning can be tedious and is often too easy to put off. A robust cloud-based accounting system can free up time by automating traditional bookkeeping tasks and offering real-time access to your business’s information—no more shoeboxes overflowing with receipts! Another bonus—cloud-based accounting programs can be customized according to your business’s unique needs.
5 - What are the biggest challenges most businesses face during tax season, and how can an advisor help?
Working with an advisor can help make sense of tax season and offer you greater peace of mind throughout the year. We can help you make decisions around annual compliance costs for financial and tax reporting, keep track of what needs to be filed and when, determine the optimal timing of your income and tax deductions, and stay on top of changing tax legislation.
Have questions? Let us help.
Tax season can be stressful—but you aren’t alone. With a comprehensive plan we will help you transition from being a reactive tax filer to a proactive one. No matter how big or small your business is, our advisors will work with you to find the best way forward.
Connie Dolomount, Tax Partner, Grant Thornton LLP (Corner Brook)
Connie Dolomount is a Tax Partner with Grant Thornton LLP in our Corner Brook office. Her passion for tax shines through her work. She advises and supports her clients to ensure they are meeting their strategic financial and personal objectives. Connie’s expertise includes
domestic income tax, succession planning, and estate planning for corporate reorganizations. Connie and her team have the expertise to help you navigate any change.
Contact her at 709-634-8242 or Connie.Dolomount@ca.gt.com.