Basic Bookkeeping Tips
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- Can I throw away the monthly statements I receive from my suppliers because I have already recorded their individual invoices?
- No don't throw them away. .
How often should I stop and to the actuals posted in my accounting ledger?
- Every month you should reconcile your bank AND credit card statements.
- Keep a listing of all your pre-authorized direct deposits and withdrawals to make reconciling your accounts easier.
- Keeping your manual cheque register up-to-date also helps reconciling your bank account easier.
Determine if your is an operating lease or a capital lease before you book your transaction.
- One can be expensed, the other cannot.
- - Think, "How do I pay myself?".If you are a sole proprietor, you do not need to complete a T4 slip for yourself ... that's because you are . When you file your annual tax return, you will have to pay income tax and CPP premiums (both the employer and employee portions) on your self employment income reported on form T2125. As of November 2009, a sole proprietor has the option ... not regular EI benefits. At some point, you will be making enough income that CRA will send you a notice informing you that you will have to begin . (They calculate the amount owing for you so you don't have to.) This requirement kicks in when you expect to owe more than $3,000 in net tax owing in the current year and have paid over $3,000 in net tax owing in either of the past 2 years. Remember to check with your provincial workers' compensation board to see if you must also pay premiums.
Stumped? It's two months later and with all the computer codes, sometimes it is hard to remember what that receipt is actually for?
- - It involves becoming familiar with your chart of accounts.
What is the correct way to book my monthly loan payment for equipment I purchased for the business?
- This is a tricky entry because you must pull out the interest expense and book it to a separate account. .
What are ? Are they the same thing as supporting documents?
- All the bookkeeping tips in the world won't do you any good without your source documents for backup to support the validity of your transaction.
Why do I need a ?
- If you were going to implement only one bookkeeping tip ... choose this one!
Do not forget to do this annual GST/HST task
- I learned this adjustment from The Jacks Institute Small Business Tax course. Once a year on your GST/HST return, add back 50% of your ITC pertaining to meals and entertainment expenses on line 104 if you claimed 100% of the GST/HST on meal expenses (and entertainment) throughout the year. If you use QuickBooks, you can setup a sales tax code M for meals and have the rate set to 50% of the current GST/HST rate. If you do this adjustment as you post each transaction, you will not have to make any annual adjustment. However, this may not be the best method for you if you have . Learn more about GST/HST in .
What is the correct way to for purchases I made from my personal funds?
- You need to know this bookkeeping tip.
How long do I have to before I can legally destroy them?
- This question is answered in "The Practice" section. It also gives you bookkeeping tips about what records and source documents you must keep..
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