TrustedSaskatoon.com Talk to the Experts – Legal and Professiona
Q: Brenda Compton : If you have 2 smaller businesses under one roof can you write off double the amounts? eg: office space, utilities, vehicles? etc.
A: No. If you are writing off office space you are only permitted one office space per company. For more specific clarification we recommend you speak with your accountant.
Q: M Liz Beisel: When CRA does an audit, how many years of receipts/data do you need to have? That year or more?
A: When the Canada Revenue Agency does an audit it is typically for a specific time period. But you should always keep 7 years. Even after seven years, it is recommended that you keep all audited financial statements, GST, PST, payroll and any government forms that have been received. Scanned copies have not been approved by CRA yet so be sure to keep originals of everything. If your documents have been destroyed by fire, flood etc. you may be required to submit a Loss of Property Declaration to CRA.
Q: Ann Lyte-Maille: What receipts must be kept and for how long?
A: Keep receipts, tax notices, government forms, invoices etc. for a minimum of seven years. Even after seven years, it is recommended that you keep all audited financial statements, GST, PST, payroll and any government forms that have been received.
Q: Darryl Spokes: If I am just starting a new business and can’t afford a bookkeeper yet, what would you recommend are the best practices I can set up on my own before I get a bookkeeper
A: Stay organized! Sorting takes the most time for our new clients. We tell all our smaller or new companies they will save a lot of money by doing these easy steps.
1. Keep corporate documents like partnership or shareholder agreements in a safe and secure place.
2. Keep all documentation for asset purchases like vehicles, office furniture, electronics etc. in a separate folder. You will need these at the end of the year.
3. Write on your receipt what the item was for. If you went for lunch with a potential client, write “Lunch with potential client” on the receipt.
4. Write on your invoices, “Paid with Cheque No. XX on XXXXX, 2013.” Or Staple the cheque stub to your copy of the paid invoice.
5. Match all the receipts and invoices that you wrote cheques for that are on the bank statement and put them in a folder marked “December 2013 on the Bank Statement”.
6. Take your receipts that you have paid with your own money and put them in an envelope marked “December 2013 Paid with Own Money”.
7. Staple your deposit slip to the invoices that have been paid with that deposit.
8. Put the deposits that are on the bank statement in your monthly folder.
9. Put all your monthly information in a folder or bin and keep it all together. Lost receipts mean lost tax benefits. You want to keep all your money in your pocket not the governments.
Q: Deenna Dekker: Do you charge annually, hourly or is there a monthly set fee?
A: We typically charge by the ½ hour. We work on an hourly basis and we have descriptive invoices that show you exactly what we have done. We do work on a monthly basis with some of our clients but we would have to do their bookkeeping for a year before we decide on a monthly contract rate.