Tax Cheat Sheet: Staying on Top of Small Business Taxes

For many businesses, the end of the calendar year coincides with their financial year-end. If this is the case for you, it’s time to start preparing your accounting records for review and filing. To help you through the process, we’ve compiled a cheat sheet of the most common records and documents your accountant needs to accomplish your small business taxes and set you up for success.

Compile Records

Depending on the categorization of your small business, your accountant will need different records. For example, if your business is a sole proprietorship or a partnership, you must file a T1 Return (Personal) and provide your accountant with all personal and business information slips. Here are some of the most common:

  • T3 Slips (income from trusts)
  • T4 Slips (if you have employment income other than your business income)
  • T4A Commission Slips
  • T5 Slips (investment income)
  • Child care expenses
  • Donation Slips
  • Medical and dental receipts
  • RRSP Contribution Slips

File a T2 Return

If you’re an incorporated company, you’ll need to file a T2 Return (Corporate) and provide these documents to your accountant if you do your own bookkeeping:

  • Asset additions or disposals during the year (land, equipment, vehicles, etc.)
  • Business use-of-home details (if operating a home-based business)
  • An electronic copy of your bookkeeping records for the year, complete with any passwords required to access the information
  • Financial statements for the year (balance sheet, income statement, cash flow statement)
  • Income tax installment assessments and notices of assessments
  • Motor vehicle expense information (percentage used for business, mileage log, etc.)
  • Payroll records (if you have employees)

Provide All Corporate Receipts, Invoices, and Bank Statements

If your accountant manages your bookkeeping throughout the year, you just need to provide them with a final collection of business receipts, invoices, and bank statements. If your bookkeeping is done at the end of the year, you’ll need to provide these documents for the entire year.

They may also require additional documentation or records, so it’s always best to meet face-to-face with them and get a list of what they need. But if you prepare the most common records listed above, you’ll be ahead of the game. Organize your records now so you can enjoy a stress-free tax season.

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