MP Group has an experienced tax compliance group that provides large accounting firm style value at a boutique level for your business. Preparing tax returns and filing on time is a necessary evil for all businesses. And ensuring to keep the compliance costs low is something most business owners consider; however, that should not be the only factor when ensuring to have your tax returns filed. Having smart, experienced professionals on your side will help you keep the tax liability down and take a proactive approach for the next year. Here are some tips that can be implemented to keep the tax fees lower.
Have Good Record Keeping
The first thing that needs to be in order for your business is ensuring that transactions are being accounted for, receipts & invoices are tracked, and the documents are being organized properly. Dumping all your expense invoices, receipts, or bills in a shoe box is probably not a good idea and it would require more time for your Toronto tax return preparer to complete the tax returns.
Therefore, ensure that the business has appropriate staff to organize credit card statements, sales and expense invoices, receipts, expense reports, etc. and ensure that all documents are appropriately handed in for filing. Having good controls and systems in place will help documents and receipts get to the right person timely.
Have Good Accounting Software & Bookkeeping
Once all receipts are being tracked and organized, it needs to be journalized, tallied up and accounted for using some software. This step ensures that the expenses and revenues are categorized (such as meals & entertainment, rent, etc.) so that the tax returns can be prepared. This also helps the company analyze expense types and margins.
We've seen companies early on maintain using an excel spreadsheets which is fine if the volume is minimal. However, if there are many transactions, it may be ideal to use accounting such as Quickbooks or Simply accounting. These are good tools for bookkeeping. If transactions become more complex, software such as SAP or Oracle may be better.
Having Good Staff or Accounting firm
To ensure that transactions are being recorded and correctly is important. This ensures that you can look over company results periodically and timely manner. The staff or firm handling your bookkeeping should record entries correctly and appropriately so that the Toronto tax return preparer does not have to make multiple adjustments.
We can not stress the importance of this function to assess company performance and key ratios such as gross margins and profitability of the company. And, ensuring all items are recorded ensures that the tax returns will be prepared correctly and avoid over tax payments (not including all the expenses)
Overall Summary
Ensuring that you don't increase the work for your Toronto tax preparer by ensuring that you implement the items noted above will in turn will decrease your tax compliance bill. However, cost and price should not be your only factor in choosing a tax preparer in Toronto. Your accounting firm should provide value and identify tax saving opportunities and provide a proactive solution to minimize taxes going forward. Considerations upon the firms experience, expertise, and how pleasant they are to work with should be reviewed.