Disclaimer: Please note this article is not financial advice. The purpose of our blog is purely educational, so please consult a professional accountant or financial advisor before making any financial decision.
When a door closes, another one opens.
Small businesses have suffered a huge hit ever since the pandemic began. Closures of small businesses reached unprecedented numbers. A report says that 84 small businesses in Vancouver shut down for good.
It’s not all doom and gloom, though. We are now seeing the start of a business boom in Vancouver, thanks to the tech industry. Officials are confident that downtown Vancouver will recover as offices resume normal operations, taking their employees back to their physical offices.
Whether you’re a struggling small business owner in downtown Vancouver or an e-commerce entrepreneur, rest easy knowing brighter days are ahead. Your business will return to normal, and orders will start to pile up.
Amidst this rise in business activity, you might find yourself lost and confused when tax season finally comes. Save yourself from the stress and trouble by knowing when is the right time to hire bookkeeping services for your business.
Here are the five signs that you need bookkeeping services ASAP.
It Takes Too Much of Your Time
As a small business owner, you have yet to expand your business to include an army of warehouse workers, sales agents, cashiers, maintenance crew, and managers. You have to be an army of one until the moment your big break comes.
For most entrepreneurs, this big break doesn’t happen overnight. It happens gradually. So much so that you will only notice it once you catch a break in the middle of it all. This would be the exact moment that you will finally realize that business is booming and you need more people to help you out.
This is also the perfect time to start looking for bookkeeping services for your Vancouver, B.C. business. Professional bookkeepers can help you manage your books, keep track of your transactions, and file your taxes for you while giving you time to step away from your business for that much-needed break.
Missed Opportunities for Tax Deductions
Any smart entrepreneur would seize the chance to minimize any expense related to their business. It could mean making compromises and seeking trade-offs whenever and wherever possible. For example, taxes could siphon the little profit you have earned, but you can reduce your monthly liabilities thanks to income tax deductibles.
Because you’ve been trying to do a bit of everything all at once, you can miss out on opportunities to lessen the burden of your income tax liability. It also doesn’t help that the list of expenses that you can deduct is extensively long. To make it even worse, each deductible has its own rules and restrictions that you have to follow.
Tax preparation is no easy task indeed!
If you want to maximize your potential tax deductions, you should hire a bookkeeper to check your books and take note of any expense that can be considered tax-deductible. The difference it makes could mean life and death for a struggling small business.
You’re Cramming Just Before the Tax Season
As the sole proprietor of your business, you’re already used to handling all management and administrative tasks yourself. It can include the hiring of new employees, managing their payroll, and of course, filing your tax returns. But, unfortunately, all these can become too much to bear.
Keeping track of your transactions and balancing your sheets can seem like a less important task throughout the year. We understand how easy it is to push these tasks to the sidelines. But when tax season comes around, you will be left scrambling to search for any receipts and billing statements you had lying around.
Save yourself from cramming an entire year’s worth of financial statements in one night. Instead, hire a certified public accountant (CPA) to do your tax preparation for you. You can rely on a CPA to accurately reflect your business numbers and file your tax returns on time.
You Have Returns Messing Up Your Books
Product returns are bound to happen to any business, no matter how good your products are. It’s a fact of life that any entrepreneur learns to accept. However, despite accepting a defective product and issuing a full refund, it can benefit your business by establishing how responsive your customer service is.
Another thing that product returns can do is mess up your books. It happens because you have to reverse how a sale transaction is accounted for in your books. You have to reflect a debit under the cash column and credit under sales to account for a sale.
Doing this manually yourself can take up too much of your time. Amidst your other responsibilities, you might leave some product returns unaccounted for. When you sit down to balance your sheets, you would be scratching your head, figuring out why the numbers won’t add up.
Let your bookkeeper cover you from all sides!
You Need Updated Business Numbers
Catching a break from your business can seem almost impossible. There will always be orders to fulfill and customers to serve (hopefully). On the administrative side, inventory needs to be kept fully stocked while paying your employees’ dues on time.
Sometimes you might want to take a break and push seemingly lesser tasks like regularly updating your books to a later date. It may look like an insignificant thing to do, especially when tax season is still far away. However, if you want to have an accurate picture of how your business is performing, you need to update your numbers on a regular basis.
A competent and diligent bookkeeper can provide you with accounting services, including keeping track of your daily transactions and writing up your balance sheet. With a bookkeeper by your side, you can request an accurate financial statement of your business at a moment’s notice and make adjustments accordingly.
If you’ve made it this far and ticked all the boxes, there’s no doubt that you and your business need bookkeeping services. Having an accountant by your side can take a huge burden off your back. But, more importantly, you can now focus your time and energy on running your business.
What are you waiting for? Tax season is just around the corner, so now is the time to get your business the trusty accountant it deserves!