How To Budget Your Accounting Expenses
Choosing a good accountant can save you a substantial amount of money every year on taxes, help you be compliant with Canada Revenue Agency (CRA) guidelines, and save you many hassles when dealing with CRA audits. But, to avail of their services, you need to pay them a fee, which in some cases can cancel out the financial savings accountants provide. The fees charged for accounting services can range from $800 to $25000 depending on the services required.
If you’re reconsidering hiring an accountant, understand that the benefits they bring to your business are numerous and cannot be measured in cash alone. The maintenance of business records, preparation of financial statements, decision making, and taxation matters depend on accounting. Similarly, accounting offers evidence in legal issues, provides information to related parties, and plays a significant part in the business’s evaluation.
However, if you’re a small business, you may not be flush with funds to invest in expensive accounting tools or personnel. So if you want to manage your company books without spending too much, Taxxlution Accounting Professionals has outlined a few tips and tricks on how to budget your accounting expenses.
Keep as many receipts as possible and organize them categorically
In business, things get busy, and while this is a good thing, it’s easy to lose track of your bills and receipts. Maintaining proper receipts will help you separate taxable and nontaxable income and identify your actual deductions. Filing receipts of all your transactions will also help you claim all of your possible deductions, saving you money.
Do not claim personal expenses in your business accounts
People are sometimes under the impression that they can claim their personal expenses through their business, and no one will be the wiser. In reality, accountants are smart enough to figure out the discrepancy and charge these expenses to your personal shareholder account. Moreover, doing this increases the accountant’s work resulting in higher accounting fees.
If you can, take on bookkeeping responsibilities yourself
If you have recently established your business, have minimal expenses and some accounting skills, you can easily save some money by taking care of your companies bookkeeping responsibilities yourself. Just make an excel sheet of the expenses you had throughout the year, keep track of your capital assets, and this will help you save a fair amount of money from your accounting fee.
Keep the number of accounts you operate to a minimum
Utilizing many different bank accounts, credit cards, and unnecessary cash accounts is a bad idea as it takes up more of your accountant’s time. As with most professions, time is money, causing a rise in accounting fees. It is also good to keep the number of accounts you operate to a minimum because it will be a lot easier for your accountant to spot deductions and not miss potential saving opportunities.
Avoid fancy accounting software
While useful in some situations, complex and expensive accounting software is often unnecessary and a waste of resources. People presume that the more expensive the software, the easier it is to operate. This misconception leads them to spend money when in reality, all they need is routine accounting that can be done with a pen, paper, and due diligence.
If necessary, spend on organization
If possible, it is wise to spend money on organizing your receipts and invoices. There are now multiple applications available that can quickly scan your documents, arranging them neatly and ready for use. It is also a good idea to make sure the application you use is compatible with your accountant’s software, so they take less time on your case and charge you less.
For more tips on how to avail of the best accounting solutions for your business on a budget, reach out to Taxxlution Accounting Professionals. We are a boutique accounting and bookkeeping firm that is technology and solution-oriented. Our staff includes experts in corporate income taxes and bookkeeping and comes along with extensive experience in accounting and Canadian tax legislation. We serve clients across Edmonton, St. Albert, Sherwood Park, Nisku, Leduc, Devon, Namao, Beaumont, Woodbend, Acheson, Alberta, and other provinces.