Starting a new business venture is exciting as you get to finally manage your own schedule and create an enterprise that you have always dreamed about building. However, managing cash flow and maintaining good books is essential to ensure your business survives the first twelve months and goes on to prosper. Consequently, it’s critical to take sound advice from an expert to ensure that you don’t end up facing unnecessary mistakes which could impact your financial future significantly. To help you avoid some basic errors that could prove to be costly, GSP Chartered Professional Accountant Professional Corporation has put together a list of the most common mistakes new businesses make with accounting.
1. Incorporating the business immediately
Generally, a business has losses in the first year. Therefore, if they run it as a sole proprietorship, instead of incorporating it straight away, the business loss can be reclaimed against other sources of personal income. As a result, it will reduce the income tax owed or increase the refund.
2. Not registering for an HST number in the first year
Most clients don’t get their harmonized sales tax (HST) number in the first year of business as they may not meet the thirty thousand dollars sales threshold. But, this is a wrong practice as the initial costs are enormous, and HST paid can be claimed back.
3. Taking care of the books in-house
When entrepreneurs start a new business, they tend to do the accounting themselves to save money. Unfortunately, they could end up making mistakes as they are not familiar with the process and will also waste valuable time which they could have used to expand the company.
To avoid these and other mistakes, reach out to the experts at GSP Chartered Professional Accountant Professional Corporation. As experienced accountants, we reliably take care of all complex accounting requirements. Our services include personal tax, corporate tax, payroll, general accounting, and cloud accounting. We also offer business accounting services for our clients. We serve clients across Mississauga, Malton, Brampton, Etobicoke, Toronto, Milton, Stoney Creek, Binbrook, Hamilton, Downtown Toronto, Scarborough, Ajax, Richmond Hill, and the surrounding areas.
For a complete list of our services, please click here. If you have any accounting questions, we’d love to hear from you. Please contact us here.
To avoid these and other mistakes, reach out to the experts at GSP Chartered Professional Accountant Professional Corporation. As experienced accountants, we reliably take care of all complex accounting requirements.