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.
For some people, a due date sounds like the end of the world. It is even worse if you haven't started anything yet to meet your deadline. How much more if we talk about income tax and the tax season?
Taxes are very intimidating topics; pair them with due dates, and they become more daunting to discuss. Knowing the due date and accomplishing the requirements ahead of time can absolutely save you from the headaches of procrastination.
This post digs deep into how to prepare your income tax before the deadline. Keep reading to learn more.
Income tax is a form of voluntary contribution imposed by a government to qualified income-generating constituents, including individuals and businesses. Taxes are necessary so that the government can keep providing public services that promote the welfare of its citizens, such as education, infrastructure, and health care.
Every country has its own tax system. Canada has a progressive form of income taxation: as your income increases, so does your tax. In addition, Canadians pay two forms of taxes: the federal tax and the provincial tax. The two have different tax rates.
The Canada Revenue Agency (CRA) manages the tax system and collects the taxes. It has a way of minimizing your taxes if you earn so much, and this is through income tax brackets.
The latest federal income tax brackets are as follows:
| Tax Rate | Income Covered |
| 15% | $49,020 |
| 20.5% | Over $49,020 to $98,040 |
| 26% | Over $98,040 to $151,978 |
| 29% | Over $151,978 to $216,511 |
| 33% | $216,512 and above |
Canada is composed of ten provinces, and each has its own provincial tax rates. Ontario, Canada's busiest province and home to the nation's capital, has the following provincial rates:
| Tax Rate | Income Covered |
| 5.05% | $45,142 |
| 9.15% | Over $45,142 up to $90,287 |
| 11.16% | Over $90,287 up to $150,000 |
| 12.16% | Over $150,001 up to $220,000 |
| 13.16 % | $220,000 and above |
Most income taxes in Canada are filed and paid every April 30th. If you have an employer, they usually withhold your taxes every month, and you can see that deduction in your payslip.
Even if you are employed and your company’s finance department processes your income tax, you still need to accomplish some paperwork if you want to file your tax on time.
When are income taxes due? It varies depending on the taxpayer's situation.
Preparing and filing your tax for the very first time is quite intimidating: you might know some steps, but not everything! You need to gather information and provide the correct computation of your taxes.
Here are the effective ways to accomplish your income tax requirements before the deadline.
We recommend that you gather all the documents relevant to your tax information. Such documents might come from your employer, banks, brokerage firms, and others with whom you do business.
You may also need the following forms:
Don't forget to secure a copy of receipts that will help you lessen your tax. These receipts can be for charity purposes, medical costs, and other investment-related expenses.
Provide your personal information as well as the information of your dependents if applicable. You might also have properties you acquired or sold. Keep a record of how much you paid or received from all legal business transactions.
If you get a refund, you have to put it to good use. You can use it as a deduction to your next taxes or save it.
A copy of your previous tax return, if you have it, is essential for the tax preparer to compute your taxes accurately and efficiently. Do not forget to keep a copy of your previous tax returns if you pay your taxes regularly.
Hiring income tax consultancy services is a smart move because they know how to file your taxes and when income tax is due for business. They can also help you avoid penalties for delayed tax filing and payment, which is the last thing you want to happen.
Select a tax preparer or firm and make an appointment. Set a date and time that best suits you and your chosen accountant. Usually, the appointment takes place in the office of your selected firm. You can also choose an online meeting if COVID-19 cases are still high in your area.
You can submit your income tax forms and other pertinent documents via mail or electronic filing.
The CRA imposes penalties on late filers, and preparing your tax on time or ahead of the deadline means avoiding them. What are the penalties if you do not make it to the deadline?
You will have a five-percent late filing penalty on your balance owed and an additional one percent every month until you pay your due. The said penalty is immediately effective on the day after your due. If your deadline is April 30, the penalty is imposed on May 1.
Preparing your taxes can be too much for you. You need to keep all your essential personal and financial documents, transaction receipts, and tax forms to avoid confusion and interruptions. If you miss the deadline, you have to pay penalties, an extra charge that you cannot afford.
Hire an accountant's professional service today to make the process easier and less stressful. We at Unloop work in partnership with tax professionals to help you get things done ahead of the tax deadline.
Call us at 877-421-7270 today, and we will help you with your tax preparation.
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.
For some people, a due date sounds like the end of the world. It is even worse if you haven't started anything yet to meet your deadline. How much more if we talk about income tax and the tax season?
Taxes are very intimidating topics; pair them with due dates, and they become more daunting to discuss. Knowing the due date and accomplishing the requirements ahead of time can absolutely save you from the headaches of procrastination.
This post digs deep into how to prepare your income tax before the deadline. Keep reading to learn more.
Income tax is a form of voluntary contribution imposed by a government to qualified income-generating constituents, including individuals and businesses. Taxes are necessary so that the government can keep providing public services that promote the welfare of its citizens, such as education, infrastructure, and health care.
Every country has its own tax system. Canada has a progressive form of income taxation: as your income increases, so does your tax. In addition, Canadians pay two forms of taxes: the federal tax and the provincial tax. The two have different tax rates.
The Canada Revenue Agency (CRA) manages the tax system and collects the taxes. It has a way of minimizing your taxes if you earn so much, and this is through income tax brackets.
The latest federal income tax brackets are as follows:
| Tax Rate | Income Covered |
| 15% | $49,020 |
| 20.5% | Over $49,020 to $98,040 |
| 26% | Over $98,040 to $151,978 |
| 29% | Over $151,978 to $216,511 |
| 33% | $216,512 and above |
Canada is composed of ten provinces, and each has its own provincial tax rates. Ontario, Canada's busiest province and home to the nation's capital, has the following provincial rates:
| Tax Rate | Income Covered |
| 5.05% | $45,142 |
| 9.15% | Over $45,142 up to $90,287 |
| 11.16% | Over $90,287 up to $150,000 |
| 12.16% | Over $150,001 up to $220,000 |
| 13.16 % | $220,000 and above |
Most income taxes in Canada are filed and paid every April 30th. If you have an employer, they usually withhold your taxes every month, and you can see that deduction in your payslip.
Even if you are employed and your company’s finance department processes your income tax, you still need to accomplish some paperwork if you want to file your tax on time.
When are income taxes due? It varies depending on the taxpayer's situation.
Preparing and filing your tax for the very first time is quite intimidating: you might know some steps, but not everything! You need to gather information and provide the correct computation of your taxes.
Here are the effective ways to accomplish your income tax requirements before the deadline.
We recommend that you gather all the documents relevant to your tax information. Such documents might come from your employer, banks, brokerage firms, and others with whom you do business.
You may also need the following forms:
Don't forget to secure a copy of receipts that will help you lessen your tax. These receipts can be for charity purposes, medical costs, and other investment-related expenses.
Provide your personal information as well as the information of your dependents if applicable. You might also have properties you acquired or sold. Keep a record of how much you paid or received from all legal business transactions.
If you get a refund, you have to put it to good use. You can use it as a deduction to your next taxes or save it.
A copy of your previous tax return, if you have it, is essential for the tax preparer to compute your taxes accurately and efficiently. Do not forget to keep a copy of your previous tax returns if you pay your taxes regularly.
Hiring income tax consultancy services is a smart move because they know how to file your taxes and when income tax is due for business. They can also help you avoid penalties for delayed tax filing and payment, which is the last thing you want to happen.
Select a tax preparer or firm and make an appointment. Set a date and time that best suits you and your chosen accountant. Usually, the appointment takes place in the office of your selected firm. You can also choose an online meeting if COVID-19 cases are still high in your area.
You can submit your income tax forms and other pertinent documents via mail or electronic filing.
The CRA imposes penalties on late filers, and preparing your tax on time or ahead of the deadline means avoiding them. What are the penalties if you do not make it to the deadline?
You will have a five-percent late filing penalty on your balance owed and an additional one percent every month until you pay your due. The said penalty is immediately effective on the day after your due. If your deadline is April 30, the penalty is imposed on May 1.
Preparing your taxes can be too much for you. You need to keep all your essential personal and financial documents, transaction receipts, and tax forms to avoid confusion and interruptions. If you miss the deadline, you have to pay penalties, an extra charge that you cannot afford.
Hire an accountant's professional service today to make the process easier and less stressful. We at Unloop work in partnership with tax professionals to help you get things done ahead of the tax deadline.
Call us at 877-421-7270 today, and we will help you with your tax preparation.
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.
Do you have a small business in Canada, or are you planning to start one? If so, then it's your responsibility to know about the Income Tax Act.
This blog post will introduce you to the basics of the act and how it affects businesses in Canada.
The Income Tax Act in Canada is legislation passed by Parliament that dictates what Canadians must do with the income and assets they earn during tax years. Income includes any revenue or profits earned from investments or employment.
The Income Tax Act is a comprehensive guide to understanding everything you need to know about Canada's tax system. It covers the various deductions and credits available and their impacts on Canadian citizens, including those living abroad and those who are not habitual residents of Canada.
It is also an invaluable resource for any Canadian looking for information on their taxes or wondering how it can affect them or their company. Knowing about the Income Tax Act and its regulations is important so that you can easily understand these complex issues.
The federal tax was first introduced in 1916, followed by the personal income tax in 1917. Both of these taxes were imposed as temporary financial measures during World War I.
The Income Tax Act remains one of the oldest acts still in force among Commonwealth countries and one of the longest-standing statutes, having undergone more than 50 amendments since its introduction. It continues to be updated periodically to meet new challenges facing Canadians today.
Yes, you have to pay income tax in Canada. Income tax starts with the federal tax and then carries on down from there.
Everything that you earn in a year is subject to the income tax laws of the country. Thus, it's important to keep track of your earnings throughout the year so that you can understand better how much money you need to allocate for taxes.
Under this act, everyone who is a Canadian citizen or a resident of Canada must file a tax return. People who are under 18 or live outside of Canada for one or more years in a row are exempted.
The act includes a table of contents and the array of changes made to this act since its original enactment.
It contains the following parts:
Furthermore, it also contains a miscellaneous collection of provisions, including laws passed by Parliament not related to any other act. These are dealt with only in the context of the Income Tax Act.
You should also know that it has regulations attached to it as soon as the government makes them available (usually after receiving royal assent). It is a guide to help you understand and follow Canada's income tax laws.
A person's taxable income is the total of all income amounts. The income includes salaries, wages, bonuses, commissions, tips, dividends, gratuities, or allowances.
The following are included in this definition:
Taxable income has three types: capital gains, employment income, and business or professional income. These income types are not taxed at the same rate.
The first type is capital gains, which is the amount you receive on investment when you sell it for more than its purchase price. You need to declare a capital gain in the year you made the sale.
If you realize a capital gain, 50% of that becomes part of your income and is thus taxable. Thus, Canada has no fixed tax rate for capital gains. The amount of tax you have to pay will vary depending on your income tax bracket at the federal and provincial levels.
Income from employment is determined by adding up all of your income earned through working for a business, self-employment, and commissions. Any allowable deductions such as moving expenses and childcare expenses are then subtracted.
The third taxable income type is business income, which includes all of the income you receive from running a business or practicing a profession in Canada. The sources of income are determined by the kind of business or profession you’re doing.
You must keep original copies of the documents that support your income declarations. These records include the following:
The cost of goods sold is an allowable deduction, even though it's technically part of the income you receive from running a merchandising business. Since it’s necessary to buy those goods to run such a business, this expense typically counts as an allowable deduction.
Other items that you need to deduct to determine your taxable business income include advertising expenses, bad debts, insurance, rent, repair and maintenance fees, employee salaries and benefits, utilities, and freight costs.
The two types of tax credits are refundable and nonrefundable.
Refundable tax credits are subtracted from your income tax payable, and if there is still a difference, you will receive that as a refund. For example, if you have to pay $5000 in income tax and you're entitled to a refundable tax credit of $5500, your tax payable becomes $0 and you will get a $500 refund.
On the other hand, nonrefundable tax credits only lower your tax up to $0, and you won’t receive the leftover.
When you hear about the RRSP (Registered Retirement Savings Plan) and TFSA (Tax-Free Savings Account), they’re usually associated with retirement savings because both types of accounts are geared toward that goal. However, you need to have earned income to contribute to your RRSP or TFSA because you cannot put money into an account that is not yours or your spouse’s.
Cashing out money from your RRSP or TFSA to live on can be tricky. If you withdraw money before you turn 65, it might affect the Guaranteed Income Supplement and/or Old Age Security benefits that you will receive.
RRSP is a tax-deferred registered savings account that allows Canadians to set some of their income aside for retirement. RRSP contributions are deductible from your taxable income in the year they are made, but withdrawals are fully taxed as ordinary income.
The money you put into your RRSP is usually not taxed. After you turn 71, though, you must begin taking money out of your plan.
The amount of money you take out from the plan you've selected will be added to your taxable income. Thus, it’s best to take it out gradually so that you don’t have to pay a lot of taxes all at once. How much money you withdraw from your plan every year depends on the amount of taxable income you expect to earn.
TFSA, on the other hand, is a type of registered account that allows Canadians to save money tax-free throughout their lifetime. Any income, gains, or losses in a TFSA are not taxed so long as the funds remain in the account. Furthermore, they won't be taxed if used for the owner’s qualifying purpose.
Just like RRSP, the money you contribute to your TFSA is not taxed. You can withdraw money from your TFSA anytime, and you won’t pay any tax on it. The downside to this is that you can only contribute up to your TFSA contribution room, which is the same as the maximum amount you can withdraw in a year.
Canada has a marginal or graduated income tax system. It means your income is taxed at different rates, depending on how much you earn. If you have a low income, you will pay a low tax rate.
From your total income, you’ll subtract federal and provincial nonrefundable tax credits, as well as any deductions or other amounts that have reduced your income. These calculations are done so that they become the lowest taxable income possible.
Then, you multiply them to the applicable tax rate according to your tax bracket. Below are Canada’s federal tax rates for 2021.
| Tax Rate | Income Bracket |
| 15% | $49,020 |
| 20.5% | Over $49,020 to $98,040 |
| 26% | Over $98,040 to $151,978 |
| 29% | Over $151,978 to $216,511 |
| 33% | $216,512 and above |
After calculating your federal tax, you need to determine your provincial tax rate. The rates differ per province. Check out the Canadian government’s website for more information.
As a Canadian taxpayer, you have to know what taxable income is under Canadian law. We hope that this has been a helpful guide to the Income Tax Act. But if things are still confusing, it’s best to consult with a Canadian tax professional.
Need assistance? You can count on us at Unloop!
As your accounting service provider, you can trust us with your business. We will automate your accounting and have your financial statements ready in time for tax season!
To get started, call us at 877-421-7270, and one of our professionals will assist you the soonest!
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.
Do you have a small business in Canada, or are you planning to start one? If so, then it's your responsibility to know about the Income Tax Act.
This blog post will introduce you to the basics of the act and how it affects businesses in Canada.
The Income Tax Act in Canada is legislation passed by Parliament that dictates what Canadians must do with the income and assets they earn during tax years. Income includes any revenue or profits earned from investments or employment.
The Income Tax Act is a comprehensive guide to understanding everything you need to know about Canada's tax system. It covers the various deductions and credits available and their impacts on Canadian citizens, including those living abroad and those who are not habitual residents of Canada.
It is also an invaluable resource for any Canadian looking for information on their taxes or wondering how it can affect them or their company. Knowing about the Income Tax Act and its regulations is important so that you can easily understand these complex issues.
The federal tax was first introduced in 1916, followed by the personal income tax in 1917. Both of these taxes were imposed as temporary financial measures during World War I.
The Income Tax Act remains one of the oldest acts still in force among Commonwealth countries and one of the longest-standing statutes, having undergone more than 50 amendments since its introduction. It continues to be updated periodically to meet new challenges facing Canadians today.
Yes, you have to pay income tax in Canada. Income tax starts with the federal tax and then carries on down from there.
Everything that you earn in a year is subject to the income tax laws of the country. Thus, it's important to keep track of your earnings throughout the year so that you can understand better how much money you need to allocate for taxes.
Under this act, everyone who is a Canadian citizen or a resident of Canada must file a tax return. People who are under 18 or live outside of Canada for one or more years in a row are exempted.
The act includes a table of contents and the array of changes made to this act since its original enactment.
It contains the following parts:
Furthermore, it also contains a miscellaneous collection of provisions, including laws passed by Parliament not related to any other act. These are dealt with only in the context of the Income Tax Act.
You should also know that it has regulations attached to it as soon as the government makes them available (usually after receiving royal assent). It is a guide to help you understand and follow Canada's income tax laws.
A person's taxable income is the total of all income amounts. The income includes salaries, wages, bonuses, commissions, tips, dividends, gratuities, or allowances.
The following are included in this definition:
Taxable income has three types: capital gains, employment income, and business or professional income. These income types are not taxed at the same rate.
The first type is capital gains, which is the amount you receive on investment when you sell it for more than its purchase price. You need to declare a capital gain in the year you made the sale.
If you realize a capital gain, 50% of that becomes part of your income and is thus taxable. Thus, Canada has no fixed tax rate for capital gains. The amount of tax you have to pay will vary depending on your income tax bracket at the federal and provincial levels.
Income from employment is determined by adding up all of your income earned through working for a business, self-employment, and commissions. Any allowable deductions such as moving expenses and childcare expenses are then subtracted.
The third taxable income type is business income, which includes all of the income you receive from running a business or practicing a profession in Canada. The sources of income are determined by the kind of business or profession you’re doing.
You must keep original copies of the documents that support your income declarations. These records include the following:
The cost of goods sold is an allowable deduction, even though it's technically part of the income you receive from running a merchandising business. Since it’s necessary to buy those goods to run such a business, this expense typically counts as an allowable deduction.
Other items that you need to deduct to determine your taxable business income include advertising expenses, bad debts, insurance, rent, repair and maintenance fees, employee salaries and benefits, utilities, and freight costs.
The two types of tax credits are refundable and nonrefundable.
Refundable tax credits are subtracted from your income tax payable, and if there is still a difference, you will receive that as a refund. For example, if you have to pay $5000 in income tax and you're entitled to a refundable tax credit of $5500, your tax payable becomes $0 and you will get a $500 refund.
On the other hand, nonrefundable tax credits only lower your tax up to $0, and you won’t receive the leftover.
When you hear about the RRSP (Registered Retirement Savings Plan) and TFSA (Tax-Free Savings Account), they’re usually associated with retirement savings because both types of accounts are geared toward that goal. However, you need to have earned income to contribute to your RRSP or TFSA because you cannot put money into an account that is not yours or your spouse’s.
Cashing out money from your RRSP or TFSA to live on can be tricky. If you withdraw money before you turn 65, it might affect the Guaranteed Income Supplement and/or Old Age Security benefits that you will receive.
RRSP is a tax-deferred registered savings account that allows Canadians to set some of their income aside for retirement. RRSP contributions are deductible from your taxable income in the year they are made, but withdrawals are fully taxed as ordinary income.
The money you put into your RRSP is usually not taxed. After you turn 71, though, you must begin taking money out of your plan.
The amount of money you take out from the plan you've selected will be added to your taxable income. Thus, it’s best to take it out gradually so that you don’t have to pay a lot of taxes all at once. How much money you withdraw from your plan every year depends on the amount of taxable income you expect to earn.
TFSA, on the other hand, is a type of registered account that allows Canadians to save money tax-free throughout their lifetime. Any income, gains, or losses in a TFSA are not taxed so long as the funds remain in the account. Furthermore, they won't be taxed if used for the owner’s qualifying purpose.
Just like RRSP, the money you contribute to your TFSA is not taxed. You can withdraw money from your TFSA anytime, and you won’t pay any tax on it. The downside to this is that you can only contribute up to your TFSA contribution room, which is the same as the maximum amount you can withdraw in a year.
Canada has a marginal or graduated income tax system. It means your income is taxed at different rates, depending on how much you earn. If you have a low income, you will pay a low tax rate.
From your total income, you’ll subtract federal and provincial nonrefundable tax credits, as well as any deductions or other amounts that have reduced your income. These calculations are done so that they become the lowest taxable income possible.
Then, you multiply them to the applicable tax rate according to your tax bracket. Below are Canada’s federal tax rates for 2021.
| Tax Rate | Income Bracket |
| 15% | $49,020 |
| 20.5% | Over $49,020 to $98,040 |
| 26% | Over $98,040 to $151,978 |
| 29% | Over $151,978 to $216,511 |
| 33% | $216,512 and above |
After calculating your federal tax, you need to determine your provincial tax rate. The rates differ per province. Check out the Canadian government’s website for more information.
As a Canadian taxpayer, you have to know what taxable income is under Canadian law. We hope that this has been a helpful guide to the Income Tax Act. But if things are still confusing, it’s best to consult with a Canadian tax professional.
Need assistance? You can count on us at Unloop!
As your accounting service provider, you can trust us with your business. We will automate your accounting and have your financial statements ready in time for tax season!
To get started, call us at 877-421-7270, and one of our professionals will assist you the soonest!
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.
Taxes are burdensome for businesses, but they are a significant obligation. We all need to comply with it to build a strong business foundation and tap on limitless opportunities.
However, tax compliance is easier said than done. It's a complex system that can cause you deep financial trouble when you don’t take it seriously and carefully. What's more, it gets even more confusing in e-commerce.
If you're new to Amazon sales tax and want to minimize financial trouble in the long run, let this article serve as your guide.
Before we get to sales tax on Amazon, here are a few things you should know about e-commerce sales taxes.
(Item Cost) × (State-Mandated Sales Tax Rate) = Total Sales Tax.
Undoubtedly, Amazon is a massive and popular marketplace. It presents an exciting but challenging opportunity for online sellers.
You need to comply with Amazon sales taxes to stay in business. But which tax-related duties should you handle, and which are for Amazon to manage? Familiarize yourself with these things to save time and increase productivity.
Determine Crucial Tax Variables
First, you must know three important variables before tax collection takes place:
Without these, it is impossible to comply with consistent accuracy.
Configure Your Store for Tax Collection
If you're a US seller and want Amazon to collect sales tax for you, go to the Seller Central tax settings. There you can view or edit tax collection, shipping and handling, and gift wrap tax obligation settings.
Note that Amazon charges 2.9% per transaction to collect sales tax. However, letting Amazon collect sales tax on your behalf is only optional; you can pay out of your profits as an alternative.
Customizing Your Tax Receipts
You might need different sales tax receipt formats depending on the location and customers you sell to (for example, the B2B sector).
On Amazon, you can customize the logo and information of your receipts. However, it doesn't allow you to change all information. Therefore, you need an extension or a third-party service to help you automate your tax receipts.
Monitor Your Tax Registration Threshold
Suppose you surpass the sales threshold limit required in a specific state. In that case, you get an economic nexus. As a result, it changes your sales tax calculations.
Unfortunately, Amazon doesn't notify you about it, so make sure to monitor your sales constantly. Installing an automated alert system can help reduce the time and effort it takes to work on this.
Gather Necessary Data for Tax Returns
Amazon doesn't give you detailed information for tax returns. You will have access to an Amazon sales tax report, but it might not have all the data you need. However, you can still find the rest of the information you need within your Amazon account, albeit it can be a hassle.
Collect Sales Taxes (For US Sellers Only)
As briefly mentioned, you can let Amazon take over sales tax collection in exchange for a 2.9% charge per transaction.
However, let's say you're collecting Amazon sales tax in Canada. Amazon won't pay or file sales taxes, but they can collect and send tax as an inclusion in your regular settlement. Still, you will need to conduct tax return filing and tax remittance to your tax authorities.
Provide a Sales Tax Report
Amazon gives you access to a sales tax report. It shows you (1) the states where Amazon collects tax on your behalf, (2) the states where you are obligated to collect and remit tax, and (3) the amount of sales tax required for states where you have a nexus.
Go to Seller Central, find Reports, and click Tax Document Library to view the report. From there, you may choose which of the following reports to generate:
Then, you may explore the available information from these reports and modify them according to your needs.
Amazon Sales Tax Exemption
Amazon allows tax exemption for individuals or organizations through the Amazon Tax Exemption Program (ATEP). They support tax-exempted items sold through Amazon.com and Amazon Services LLC, Amazon Digital Services, Warehouse Deals, and third-party sellers.
An Amazon Business seller is qualified for this program, while ATEP participants automatically get tax exemptions.
Tax compliance on Amazon can be challenging. You need to understand what Amazon can help you with and which aspects you're solely responsible for. We hope this article has helped clarify these matters. However, if you're still a little lost, Unloop can be your reliable bookkeeping and accounting service provider.
Our sales tax filing services apply to Amazon sellers in Canada and the USA. We help you determine nexuses, register for tax permits, set up and manage sales tax platforms, and continuously monitor compliance.
Contact us today for more information.
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.
Taxes are burdensome for businesses, but they are a significant obligation. We all need to comply with it to build a strong business foundation and tap on limitless opportunities.
However, tax compliance is easier said than done. It's a complex system that can cause you deep financial trouble when you don’t take it seriously and carefully. What's more, it gets even more confusing in e-commerce.
If you're new to Amazon sales tax and want to minimize financial trouble in the long run, let this article serve as your guide.
Before we get to sales tax on Amazon, here are a few things you should know about e-commerce sales taxes.
(Item Cost) × (State-Mandated Sales Tax Rate) = Total Sales Tax.
Undoubtedly, Amazon is a massive and popular marketplace. It presents an exciting but challenging opportunity for online sellers.
You need to comply with Amazon sales taxes to stay in business. But which tax-related duties should you handle, and which are for Amazon to manage? Familiarize yourself with these things to save time and increase productivity.
Determine Crucial Tax Variables
First, you must know three important variables before tax collection takes place:
Without these, it is impossible to comply with consistent accuracy.
Configure Your Store for Tax Collection
If you're a US seller and want Amazon to collect sales tax for you, go to the Seller Central tax settings. There you can view or edit tax collection, shipping and handling, and gift wrap tax obligation settings.
Note that Amazon charges 2.9% per transaction to collect sales tax. However, letting Amazon collect sales tax on your behalf is only optional; you can pay out of your profits as an alternative.
Customizing Your Tax Receipts
You might need different sales tax receipt formats depending on the location and customers you sell to (for example, the B2B sector).
On Amazon, you can customize the logo and information of your receipts. However, it doesn't allow you to change all information. Therefore, you need an extension or a third-party service to help you automate your tax receipts.
Monitor Your Tax Registration Threshold
Suppose you surpass the sales threshold limit required in a specific state. In that case, you get an economic nexus. As a result, it changes your sales tax calculations.
Unfortunately, Amazon doesn't notify you about it, so make sure to monitor your sales constantly. Installing an automated alert system can help reduce the time and effort it takes to work on this.
Gather Necessary Data for Tax Returns
Amazon doesn't give you detailed information for tax returns. You will have access to an Amazon sales tax report, but it might not have all the data you need. However, you can still find the rest of the information you need within your Amazon account, albeit it can be a hassle.
Collect Sales Taxes (For US Sellers Only)
As briefly mentioned, you can let Amazon take over sales tax collection in exchange for a 2.9% charge per transaction.
However, let's say you're collecting Amazon sales tax in Canada. Amazon won't pay or file sales taxes, but they can collect and send tax as an inclusion in your regular settlement. Still, you will need to conduct tax return filing and tax remittance to your tax authorities.
Provide a Sales Tax Report
Amazon gives you access to a sales tax report. It shows you (1) the states where Amazon collects tax on your behalf, (2) the states where you are obligated to collect and remit tax, and (3) the amount of sales tax required for states where you have a nexus.
Go to Seller Central, find Reports, and click Tax Document Library to view the report. From there, you may choose which of the following reports to generate:
Then, you may explore the available information from these reports and modify them according to your needs.
Amazon Sales Tax Exemption
Amazon allows tax exemption for individuals or organizations through the Amazon Tax Exemption Program (ATEP). They support tax-exempted items sold through Amazon.com and Amazon Services LLC, Amazon Digital Services, Warehouse Deals, and third-party sellers.
An Amazon Business seller is qualified for this program, while ATEP participants automatically get tax exemptions.
Tax compliance on Amazon can be challenging. You need to understand what Amazon can help you with and which aspects you're solely responsible for. We hope this article has helped clarify these matters. However, if you're still a little lost, Unloop can be your reliable bookkeeping and accounting service provider.
Our sales tax filing services apply to Amazon sellers in Canada and the USA. We help you determine nexuses, register for tax permits, set up and manage sales tax platforms, and continuously monitor compliance.
Contact us today for more information.
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.
As humans do, manufactured goods have shelters, too. It’s called an inventory, and it comes in physical and digital forms. Undoubtedly, your company's inventory is one of the most significant aspects of your Edmonton business. It houses your source of income and keeps the business running.
It helps you know if there's enough stock or if you're running short of supply. However, inventory is more than just a shelter for goods. It's also a company asset, so it needs proper documentation. This documenting process is called inventory accounting.
If you can't handle your inventory properly, you become prone to order inaccuracies and, eventually, financial trouble. Before things get to this, you must learn the ropes of inventory management and accounting.
If you're not using bookkeeping services in Edmonton to manage your inventory, you will need to find some time in your schedule to dedicate specifically towards inventory accounting. First, let's discuss the basics and some useful tips for seamless inventory accounting.
Before we get to the tips, let's have a quick overview of inventory accounting for a refresher.
Inventory accounting determines the cost value of inventory goods in certain production phases (raw, in-progress, and for sale). Thus, it accurately represents the company-wide value of all assets, which is important when evaluating the big picture of a business.
Increasing profit margins is another advantage. Generally, assets are important to determine and improve the company's value in the long run, and inventory accounting ensures you examine them carefully and accurately.
Generally, inventory accounting makes management easier and helps grow your business. Some of its specific benefits include (but are not limited to) the following:
Inventory accounting has three common methods: First In/First Out (FIFO), Last In/First Out (LIFO), and Weighted Average Cost Method (AVCO). Here's how they work.
FIFO is for a business that sells goods that come first in the inventory. You document the cost of a new item, document a sale, and dispose of them from the list. This method lets you see the profit margin changes over time.
If FIFO focuses on the oldest items in your inventory, LIFO works on the newest/recent goods first. It involves the same process as FIFO: record the cost of an item that comes in, record the cost of sale, and eliminate it from the list. LIFO reduces income taxes because the sold goods are purchased at their highest price.
AVCO calculates the total cost of inventory items for sale and the number of units bought or made at the start of the accounting period. Compared to the other two methods, AVCO is a simpler process. Hence, it leaves some important details that might not be ideal for big pricing fluctuations.
Inventory accounting is a vital aspect of bookkeeping for small businesses, but it can also be challenging. We want to share several key tips with you to secure your business financials and overall success as a company.
Gone are the days of manual inventory management—times when you only used papers, clipboards, calculators, and ballpoint pens to keep up with managing and accounting. Now, inventory management software makes things easier, faster, and less prone to human errors.
When choosing the right software, look at the most important attributes. Ensure that it will make your work easier, faster, and consistently accurate. Most importantly, don't forget to run tests before making a decision.
Some of the costs that you might need can come from various sources with different submission dates. For example, landed costs (total cost of a landed shipment) come from suppliers, shipping providers, or customs brokers. Unfortunately, some of them can take days to weeks to send the bills.
It's challenging for an accountant, having to wait for pieces of information on irregular dates. Still, it's more practical to start estimating costs based on the available data. Previous charges may help for initial estimations, and the management software can update and recost them later.
Inventory accounting isn't just about the value of what's in stock. It also involves sold inventory, called the Cost of Goods Sold (COGS) or Cost of Sale. COGS is the sum of all costs a business needs to sell inventory. Accountants include COGS as part of their income statement reports.
COGS helps determine cash flow levels and profitability. You'll know how much you're currently making and how much you need to earn sales revenue. The simplest COGS formula that most businesses use for inventory accounting is: starting inventory + purchases during the accounting period - ending inventory.
Inventory accounting can be overwhelming, especially for e-commerce businesses. You deal with a large-scale customer base, making inventory and financial management even more challenging. However, you don't have to deal with them on your own. If you need assistance, Unloop can help you with seamless bookkeeping and accounting tasks.
Is your bookkeeping service available in Edmonton? Do you offer small business bookkeeping in Edmonton? Yes! We offer bookkeeping services in Edmonton, Alberta, and other areas in Canada and the USA. We combine experts and technology to help you with your books, including inventory tracking, tax preparation, and COGS calculation. Work with us today.
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.
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.
As humans do, manufactured goods have shelters, too. It’s called an inventory, and it comes in physical and digital forms. Undoubtedly, your company's inventory is one of the most significant aspects of your Edmonton business. It houses your source of income and keeps the business running.
It helps you know if there's enough stock or if you're running short of supply. However, inventory is more than just a shelter for goods. It's also a company asset, so it needs proper documentation. This documenting process is called inventory accounting.
If you can't handle your inventory properly, you become prone to order inaccuracies and, eventually, financial trouble. Before things get to this, you must learn the ropes of inventory management and accounting.
If you're not using bookkeeping services in Edmonton to manage your inventory, you will need to find some time in your schedule to dedicate specifically towards inventory accounting. First, let's discuss the basics and some useful tips for seamless inventory accounting.
Before we get to the tips, let's have a quick overview of inventory accounting for a refresher.
Inventory accounting determines the cost value of inventory goods in certain production phases (raw, in-progress, and for sale). Thus, it accurately represents the company-wide value of all assets, which is important when evaluating the big picture of a business.
Increasing profit margins is another advantage. Generally, assets are important to determine and improve the company's value in the long run, and inventory accounting ensures you examine them carefully and accurately.
Generally, inventory accounting makes management easier and helps grow your business. Some of its specific benefits include (but are not limited to) the following:
Inventory accounting has three common methods: First In/First Out (FIFO), Last In/First Out (LIFO), and Weighted Average Cost Method (AVCO). Here's how they work.
FIFO is for a business that sells goods that come first in the inventory. You document the cost of a new item, document a sale, and dispose of them from the list. This method lets you see the profit margin changes over time.
If FIFO focuses on the oldest items in your inventory, LIFO works on the newest/recent goods first. It involves the same process as FIFO: record the cost of an item that comes in, record the cost of sale, and eliminate it from the list. LIFO reduces income taxes because the sold goods are purchased at their highest price.
AVCO calculates the total cost of inventory items for sale and the number of units bought or made at the start of the accounting period. Compared to the other two methods, AVCO is a simpler process. Hence, it leaves some important details that might not be ideal for big pricing fluctuations.
Inventory accounting is a vital aspect of bookkeeping for small businesses, but it can also be challenging. We want to share several key tips with you to secure your business financials and overall success as a company.
Gone are the days of manual inventory management—times when you only used papers, clipboards, calculators, and ballpoint pens to keep up with managing and accounting. Now, inventory management software makes things easier, faster, and less prone to human errors.
When choosing the right software, look at the most important attributes. Ensure that it will make your work easier, faster, and consistently accurate. Most importantly, don't forget to run tests before making a decision.
Some of the costs that you might need can come from various sources with different submission dates. For example, landed costs (total cost of a landed shipment) come from suppliers, shipping providers, or customs brokers. Unfortunately, some of them can take days to weeks to send the bills.
It's challenging for an accountant, having to wait for pieces of information on irregular dates. Still, it's more practical to start estimating costs based on the available data. Previous charges may help for initial estimations, and the management software can update and recost them later.
Inventory accounting isn't just about the value of what's in stock. It also involves sold inventory, called the Cost of Goods Sold (COGS) or Cost of Sale. COGS is the sum of all costs a business needs to sell inventory. Accountants include COGS as part of their income statement reports.
COGS helps determine cash flow levels and profitability. You'll know how much you're currently making and how much you need to earn sales revenue. The simplest COGS formula that most businesses use for inventory accounting is: starting inventory + purchases during the accounting period - ending inventory.
Inventory accounting can be overwhelming, especially for e-commerce businesses. You deal with a large-scale customer base, making inventory and financial management even more challenging. However, you don't have to deal with them on your own. If you need assistance, Unloop can help you with seamless bookkeeping and accounting tasks.
Is your bookkeeping service available in Edmonton? Do you offer small business bookkeeping in Edmonton? Yes! We offer bookkeeping services in Edmonton, Alberta, and other areas in Canada and the USA. We combine experts and technology to help you with your books, including inventory tracking, tax preparation, and COGS calculation. Work with us today.
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.
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.
You decided to join Shopify and wonder what makes an e-commerce business successful in a massive marketplace. You've heard incredible success stories here and there, but you also know that it doesn't just happen to anyone.
Most sellers who fail to do so or are inexperienced would only focus on implementing effective strategies. Of course, that's not wrong and is a much-needed aspect of a business. However, there's another overlooked aspect: financial management.
You can have the best e-commerce strategy, but things will not work without a good cash flow. It's the core point of it all. Therefore, as you begin your journey as a Shopify seller, you must first build a well-rounded bookkeeping and accounting system. Then, you can focus on other important aspects, such as digital marketing strategies.
If you're still lost in all of this Shopify accounting fuss, take a seat and allow us to guide you with the dos and don'ts of e-commerce accounting in detail. Understand how transactions work on the platform, find good accounting software, look for mistakes to avoid, and take note of accounting tips that work.
In case you're not convinced enough as to why bookkeeping and accounting are as important (or more) than your e-commerce strategy, we've enumerated the reasons why. Before that, here's a quick refresher on the difference between bookkeeping and accounting.
Bookkeeping and accounting can be confusing because their tasks are associated with each other. In addition, some sources would even use them interchangeably. As a result, most people would think they have a similar meaning.
However, it's important to know that there's a significant difference between the two. It's a crucial point in your decision-making when managing your Shopify accounting.
Bookkeeping records and manages financial data. Examples include account reconciliation, organizing transactions, maintaining balance sheets, income statements, and cash flow statements.
Meanwhile, accounting focuses on analyzing collected data to ensure the good financial health of a business. Examples include tax compliance planning, Shopify accounting reports and auditing, and forecasting future costs.
Now that we're clear with the difference, let's hear the reasons why they matter greatly to your online business.
Without the ability to track these accurately, your business could end up in immeasurable heaps of trouble. Of course, no company wants to fail, but those who do often lack focus and management skills in the financial aspect.
Moreover, e-commerce accounting is different from offline management, which makes it a lot more complicated.
It's for these reasons that you need to meticulously work on the bookkeeping and accounting aspects of your e-commerce business.
Now that you understand the essence of financial management in e-commerce, let's move on to the core part of this article: how to do Shopify e-commerce accounting. Start by finding the right tools to kickstart your accounting duties.
The wide range of accounting software and tools on Shopify might be overwhelming. Avoid making the wrong choices and save time and money with this guide.
Growing an e-commerce business means working on massive data. Since you're extending your reach to various regions, states, and countries, you will take in more and more transactions. Accounting software offers cloud-based and automated technology, making financial management easier and less error-prone.
Accounting software allows the seller to:
Experts and most e-commerce sellers usually recommend QuickBooks, Sage, and NetSuite for Shopify. Here's what you need to know about these programs.
QuickBooks is a popular choice for Shopify sellers because it's easy to learn and has advanced features for accounting. You get a user-friendly dashboard for quick references and in-depth accounting reports. In addition, there are customizable options for invoice templates and reports. What's more is that you can integrate multiple apps within and outside of their product range.
Sage incorporates time-saving and industry-specific features. It is a top provider in the UK, but sellers from across the globe can use it. The platform includes an automatic transaction matching system and uses AI to remember your data selections. In addition, it provides in-depth financial reports and has a nice interface too.
NetSuite is relatively more expensive than the two. It's an enterprise resource planning system that allows you to automate financial transactions such as orders, billing, and inventory management. Forms, records, and workflows are customizable with industry-specific options. NetSuite is a good choice for large businesses with a complex accounting system.
Your accounting software must be the primary tool for all your bookkeeping and accounting tasks. However, you may also add other Shopify tools to maximize seamless accounting for your business. Check out these free and simple tools.
You can only pick the right accounting software if you've identified your business needs. Before you look into these tools, analyze your business status first. What's the current financial situation? What do you need right now to improve, and what are your plans? Will you introduce new products? Will you switch to omnichannel marketing?
Setting your knowledge and expectations of your business will help determine which features you're going to look for in software. In addition, think of the bigger picture and seek long-term solutions.
Keep your books up-to-date to make way for accurate business decisions. You must always have correct financial information to avoid discrepancies in the long run. Do this on a weekly to monthly basis.
Moreover, include basic financial transactions and reports, such as profit and loss statements, cash flows, inventory forecast, and balance sheets. All these details will help you make a better evaluation, forecasting of costs, and budgeting decisions.
A report states that organizations lose 5% of revenue every year due to fraud. The main reasons are that businesses aren't careful enough when hiring someone or don't have effective security systems to prevent incidents like this. Moreover, it takes a lot of time and effort to recover the stolen finances, and most companies fail to do so.
Ensure to keep a close eye on vital financial information. Fortunately, accounting software gives you control over who can access a certain file, such as bank accounts or bank statement reconciliations. Therefore, you can prevent or minimize the risk of fraud with the right tools and meticulous hiring processes.
Since the South Dakota v. Wayfair, Inc. decision in 2018, online retailers were required to pay sales taxes in the states they're associated with. The current system is very extensive and confusing, especially if you're not yet familiar with it. Each country, state, and even local areas have different sales tax rates that you have to be aware of.
Tax compliance is a significant part of a seller's obligations, so you must not overlook it. Learn about your associated locations' tax rates and rules in advance and seek effective solutions to comply with them. You can always ask the help of an accounting team to help you with your e-commerce sales taxes.
To maximize your preventive measures on accounting for Shopify sales, you must also know what mistakes to avoid. People learn from mistakes, but you don't have to make it yourself to understand.
Some things never change. Unfortunately, many Shopify sellers still make these mistakes despite warnings and clarifications. Naturally, you wouldn't want to be a part of that, so learn from these errors before making them yourself.
First off, many sellers do not have an accounting system in the first place. They think that the Shopify dashboard and the little data from their account balance will do all the work. Unfortunately, that can only cost you huge financial losses in the long run.
You can't properly evaluate and organize your finances without an accounting system. You have to track and record all transactions, assets, liabilities, and other expenses. Missing one of these can result in incorrect compliance and creation of your statements. If you're serious about growing your business, do yourself a favor and build a good foundation from the start.
Inexperienced sellers would record all deposits entirely to the Sales category. This creates some issues because tracking them needs some classification. Aside from sales, deposits also include discounts, returns, account fees, shipping income, and sales taxes. You have to code each batch to the correct categories for proper tracking purposes.
Additionally, some sellers record sales in the wrong timeline. For example, one batch might belong to the previous month, but you included them in the current month instead. It becomes difficult to manage, and you're going to screw up your monthly sales data.
You should learn how to put a clear line between personal and business matters. In the financial aspect, this is very crucial. Unfortunately, most start-ups or companies with few employees make this mistake often, leading to inaccurate business data and improper compliance.
Some examples are using the wrong bank account for a certain transaction or the same Shopify account for personal and business books. These only put you at risk of financial trouble, so avoid merging the two matters as much as possible. Learn to keep the right records to the correct places.
If you are switching to automated software, don't expect it to handle all transactions effortlessly. While there is truth in what the tools are capable of from that statement, one thing you should know is that it doesn't work on excessive volumes. Just like you, the software can get overwhelmed, too.
If you're running up to thousands of transactions regularly, it can be difficult and time-consuming to reconcile them. This is why instead of one-by-one, you should post your Shopify sales data in summary form and incorporate a cloud system to house it.
Bookkeeping and accounting might not be the main reasons why you wanted to join Shopify at first. Instead, you're thrilled to implement digital marketing strategies and expand your customer base to a global scale. However, you must also understand that bookkeeping and accounting are the foundations of a profitable business.
Regardless of whether you like Shopify bookkeeping and accounting or not, you have to do your books properly. Think of it as a long-term preventive measure. Don't make e-commerce harder than it already is. Do everything you can to make the work easier and 100% accurate.
If you feel this will take up too much of your time, you can work with the Unloop Team to manage your books. Our services include bookkeeping, sales tax, and income tax (together with our partner accounting firms) for Shopify, Amazon, and multichannel sellers. Moreover, we use the best accounting tools like QuickBooks Online, TaxJar, and A2X. Gear up for a seamless accounting on Shopify today.
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.
You decided to join Shopify and wonder what makes an e-commerce business successful in a massive marketplace. You've heard incredible success stories here and there, but you also know that it doesn't just happen to anyone.
Most sellers who fail to do so or are inexperienced would only focus on implementing effective strategies. Of course, that's not wrong and is a much-needed aspect of a business. However, there's another overlooked aspect: financial management.
You can have the best e-commerce strategy, but things will not work without a good cash flow. It's the core point of it all. Therefore, as you begin your journey as a Shopify seller, you must first build a well-rounded bookkeeping and accounting system. Then, you can focus on other important aspects, such as digital marketing strategies.
If you're still lost in all of this Shopify accounting fuss, take a seat and allow us to guide you with the dos and don'ts of e-commerce accounting in detail. Understand how transactions work on the platform, find good accounting software, look for mistakes to avoid, and take note of accounting tips that work.
In case you're not convinced enough as to why bookkeeping and accounting are as important (or more) than your e-commerce strategy, we've enumerated the reasons why. Before that, here's a quick refresher on the difference between bookkeeping and accounting.
Bookkeeping and accounting can be confusing because their tasks are associated with each other. In addition, some sources would even use them interchangeably. As a result, most people would think they have a similar meaning.
However, it's important to know that there's a significant difference between the two. It's a crucial point in your decision-making when managing your Shopify accounting.
Bookkeeping records and manages financial data. Examples include account reconciliation, organizing transactions, maintaining balance sheets, income statements, and cash flow statements.
Meanwhile, accounting focuses on analyzing collected data to ensure the good financial health of a business. Examples include tax compliance planning, Shopify accounting reports and auditing, and forecasting future costs.
Now that we're clear with the difference, let's hear the reasons why they matter greatly to your online business.
Without the ability to track these accurately, your business could end up in immeasurable heaps of trouble. Of course, no company wants to fail, but those who do often lack focus and management skills in the financial aspect.
Moreover, e-commerce accounting is different from offline management, which makes it a lot more complicated.
It's for these reasons that you need to meticulously work on the bookkeeping and accounting aspects of your e-commerce business.
Now that you understand the essence of financial management in e-commerce, let's move on to the core part of this article: how to do Shopify e-commerce accounting. Start by finding the right tools to kickstart your accounting duties.
The wide range of accounting software and tools on Shopify might be overwhelming. Avoid making the wrong choices and save time and money with this guide.
Growing an e-commerce business means working on massive data. Since you're extending your reach to various regions, states, and countries, you will take in more and more transactions. Accounting software offers cloud-based and automated technology, making financial management easier and less error-prone.
Accounting software allows the seller to:
Experts and most e-commerce sellers usually recommend QuickBooks, Sage, and NetSuite for Shopify. Here's what you need to know about these programs.
QuickBooks is a popular choice for Shopify sellers because it's easy to learn and has advanced features for accounting. You get a user-friendly dashboard for quick references and in-depth accounting reports. In addition, there are customizable options for invoice templates and reports. What's more is that you can integrate multiple apps within and outside of their product range.
Sage incorporates time-saving and industry-specific features. It is a top provider in the UK, but sellers from across the globe can use it. The platform includes an automatic transaction matching system and uses AI to remember your data selections. In addition, it provides in-depth financial reports and has a nice interface too.
NetSuite is relatively more expensive than the two. It's an enterprise resource planning system that allows you to automate financial transactions such as orders, billing, and inventory management. Forms, records, and workflows are customizable with industry-specific options. NetSuite is a good choice for large businesses with a complex accounting system.
Your accounting software must be the primary tool for all your bookkeeping and accounting tasks. However, you may also add other Shopify tools to maximize seamless accounting for your business. Check out these free and simple tools.
You can only pick the right accounting software if you've identified your business needs. Before you look into these tools, analyze your business status first. What's the current financial situation? What do you need right now to improve, and what are your plans? Will you introduce new products? Will you switch to omnichannel marketing?
Setting your knowledge and expectations of your business will help determine which features you're going to look for in software. In addition, think of the bigger picture and seek long-term solutions.
Keep your books up-to-date to make way for accurate business decisions. You must always have correct financial information to avoid discrepancies in the long run. Do this on a weekly to monthly basis.
Moreover, include basic financial transactions and reports, such as profit and loss statements, cash flows, inventory forecast, and balance sheets. All these details will help you make a better evaluation, forecasting of costs, and budgeting decisions.
A report states that organizations lose 5% of revenue every year due to fraud. The main reasons are that businesses aren't careful enough when hiring someone or don't have effective security systems to prevent incidents like this. Moreover, it takes a lot of time and effort to recover the stolen finances, and most companies fail to do so.
Ensure to keep a close eye on vital financial information. Fortunately, accounting software gives you control over who can access a certain file, such as bank accounts or bank statement reconciliations. Therefore, you can prevent or minimize the risk of fraud with the right tools and meticulous hiring processes.
Since the South Dakota v. Wayfair, Inc. decision in 2018, online retailers were required to pay sales taxes in the states they're associated with. The current system is very extensive and confusing, especially if you're not yet familiar with it. Each country, state, and even local areas have different sales tax rates that you have to be aware of.
Tax compliance is a significant part of a seller's obligations, so you must not overlook it. Learn about your associated locations' tax rates and rules in advance and seek effective solutions to comply with them. You can always ask the help of an accounting team to help you with your e-commerce sales taxes.
To maximize your preventive measures on accounting for Shopify sales, you must also know what mistakes to avoid. People learn from mistakes, but you don't have to make it yourself to understand.
Some things never change. Unfortunately, many Shopify sellers still make these mistakes despite warnings and clarifications. Naturally, you wouldn't want to be a part of that, so learn from these errors before making them yourself.
First off, many sellers do not have an accounting system in the first place. They think that the Shopify dashboard and the little data from their account balance will do all the work. Unfortunately, that can only cost you huge financial losses in the long run.
You can't properly evaluate and organize your finances without an accounting system. You have to track and record all transactions, assets, liabilities, and other expenses. Missing one of these can result in incorrect compliance and creation of your statements. If you're serious about growing your business, do yourself a favor and build a good foundation from the start.
Inexperienced sellers would record all deposits entirely to the Sales category. This creates some issues because tracking them needs some classification. Aside from sales, deposits also include discounts, returns, account fees, shipping income, and sales taxes. You have to code each batch to the correct categories for proper tracking purposes.
Additionally, some sellers record sales in the wrong timeline. For example, one batch might belong to the previous month, but you included them in the current month instead. It becomes difficult to manage, and you're going to screw up your monthly sales data.
You should learn how to put a clear line between personal and business matters. In the financial aspect, this is very crucial. Unfortunately, most start-ups or companies with few employees make this mistake often, leading to inaccurate business data and improper compliance.
Some examples are using the wrong bank account for a certain transaction or the same Shopify account for personal and business books. These only put you at risk of financial trouble, so avoid merging the two matters as much as possible. Learn to keep the right records to the correct places.
If you are switching to automated software, don't expect it to handle all transactions effortlessly. While there is truth in what the tools are capable of from that statement, one thing you should know is that it doesn't work on excessive volumes. Just like you, the software can get overwhelmed, too.
If you're running up to thousands of transactions regularly, it can be difficult and time-consuming to reconcile them. This is why instead of one-by-one, you should post your Shopify sales data in summary form and incorporate a cloud system to house it.
Bookkeeping and accounting might not be the main reasons why you wanted to join Shopify at first. Instead, you're thrilled to implement digital marketing strategies and expand your customer base to a global scale. However, you must also understand that bookkeeping and accounting are the foundations of a profitable business.
Regardless of whether you like Shopify bookkeeping and accounting or not, you have to do your books properly. Think of it as a long-term preventive measure. Don't make e-commerce harder than it already is. Do everything you can to make the work easier and 100% accurate.
If you feel this will take up too much of your time, you can work with the Unloop Team to manage your books. Our services include bookkeeping, sales tax, and income tax (together with our partner accounting firms) for Shopify, Amazon, and multichannel sellers. Moreover, we use the best accounting tools like QuickBooks Online, TaxJar, and A2X. Gear up for a seamless accounting on Shopify today.
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.
Can’t catch up with your booming business?
Small business owners can be a victim of their own success. As your business grows, your inventory becomes larger and harder to maintain. Simultaneously, the number of customers you have to serve increases, so you must hire even more employees.
Keeping track of your business becomes a more difficult task. With a rapidly growing business, everything can quickly become a huge mess. When tax season comes around, you’ll be scrambling for your copies of invoice receipts, statements, and other important documents.
Who will save you from the financial mess (and surprise audits)?
A tax accountant, that’s who! Of course, you need a reliable, sharp, and honest tax accountant working closely with you as you grow your business. But which traits should you keep an eye out for when hiring a tax accountant?
In this handy guide, we list down the most important qualities that your tax accountant should have. Read on!
Inevitably, you have to share all information you have about your business with your tax accountant. Every invoice, transaction, and expense has to be accounted for. With that treasure trove of information about the inner workings of your business, your entrepreneurial instincts are right to tell you that you can’t just trust anyone.
That’s why the first and most important trait that you have to look for in your potential tax accountant is trustworthiness. Could they be trusted not to divulge sensitive information to anyone? Would they tell you if there’s something amiss with your books? These are the questions that you should ask yourself before deciding to hire someone.
Remember, you have to treat your tax accountant as a business partner. There should be mutual trust between the two of you to make a professional relationship work.
The best tax accountant not only knows the tax laws in your country but also has a good grasp of the industry your business belongs to. There are tax regulations that are specific to certain sectors that an inexperienced tax accountant might miss. Your tax accountant should have you covered from all sides.
When interviewing potential candidates as your tax accountant, ask them for their work experience. Check their resume if they have any prior experience with a client that belongs to the same field as you do. Let them share their experience working with such clients. Find out what they liked the most about it and the difficulties they faced.
You can test their field knowledge by throwing some scenarios at them. These scenarios could be entirely hypothetical or something you’ve encountered in the day-to-day operations of your business. A quick-witted and experienced tax return accountant would instantly know how to resolve these problems.
Needless to say, the bare minimum standard for your tax accountant is that they have to be a Certified Public Accountant (CPA).
Business owners usually describe their business as a team. That couldn’t be any closer to the truth. Each member of this team has a specific role to fulfill. If even one of them goes missing, productivity would surely take a hit.
Your tax accountant should be able to work with anyone in your team. Bookkeeping demands coordination from the different members and departments of your business. They would be working not only with numbers but with people as well.
There will surely be times when you will have to ask more from your team members. It could be filling in for someone who took a sick leave or even working for more hours than expected. Your tax accountant should be eager to do more for the sake of your organization’s goal.
As the day goes by, receipts and statements can easily pile up on your desk. With so many things to do, you might misplace a document or two. When it’s time to write the reports and account for everything, you will probably regret not being organized sooner.
A tax accountant searches high and low for every piece of paper trail that your business has. The sheer amount of documents can easily overwhelm a disorganized tax accountant. However, your tax accountant should be able to systematically organize your business documents, file your tax returns, and do bookkeeping with zero fuss.
If ever an external audit comes to check your books, you can rest easy knowing that everything has been organized and accounted for by your trusty tax accountant. Their accounting method matters more than you think.
Laws and regulations change all the time. They change more often than you can count. That’s why your tax accountant must hold themself responsible for learning about developments in the tax law and new regulations concerning your business.
They must also keep themself updated with the latest developments and innovations in the field of tax accounting. For example, tax accountants now use more complicated and advanced accounting software that makes their jobs easier and more efficient.
An accountant who is stuck in the past will drag your business down.
A business that has a good reputation attracts more customers.
You work hard to keep your business clean and honest. Would you ruin its untarnished reputation by hiring a tax accountant with a dubious background? As the saying goes, a rotten apple can spoil the entire barrel.
When entertaining a candidate, make sure that their integrity is intact. Likewise, when accounting tax and balancing sheets, they should uphold the highest ethical standards. You should feel assured that they will be honest while doing their job even if no one’s looking.
Hiring a tax accountant is a serious matter. Depending on the skills, experience, and values that your would-be tax accountant possesses, they can either be an indispensable asset to your business or lead it towards financial ruin.
Does your potential tax accountant have these traits? If they do, you’re halfway towards greater financial success!
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.
Can’t catch up with your booming business?
Small business owners can be a victim of their own success. As your business grows, your inventory becomes larger and harder to maintain. Simultaneously, the number of customers you have to serve increases, so you must hire even more employees.
Keeping track of your business becomes a more difficult task. With a rapidly growing business, everything can quickly become a huge mess. When tax season comes around, you’ll be scrambling for your copies of invoice receipts, statements, and other important documents.
Who will save you from the financial mess (and surprise audits)?
A tax accountant, that’s who! Of course, you need a reliable, sharp, and honest tax accountant working closely with you as you grow your business. But which traits should you keep an eye out for when hiring a tax accountant?
In this handy guide, we list down the most important qualities that your tax accountant should have. Read on!
Inevitably, you have to share all information you have about your business with your tax accountant. Every invoice, transaction, and expense has to be accounted for. With that treasure trove of information about the inner workings of your business, your entrepreneurial instincts are right to tell you that you can’t just trust anyone.
That’s why the first and most important trait that you have to look for in your potential tax accountant is trustworthiness. Could they be trusted not to divulge sensitive information to anyone? Would they tell you if there’s something amiss with your books? These are the questions that you should ask yourself before deciding to hire someone.
Remember, you have to treat your tax accountant as a business partner. There should be mutual trust between the two of you to make a professional relationship work.
The best tax accountant not only knows the tax laws in your country but also has a good grasp of the industry your business belongs to. There are tax regulations that are specific to certain sectors that an inexperienced tax accountant might miss. Your tax accountant should have you covered from all sides.
When interviewing potential candidates as your tax accountant, ask them for their work experience. Check their resume if they have any prior experience with a client that belongs to the same field as you do. Let them share their experience working with such clients. Find out what they liked the most about it and the difficulties they faced.
You can test their field knowledge by throwing some scenarios at them. These scenarios could be entirely hypothetical or something you’ve encountered in the day-to-day operations of your business. A quick-witted and experienced tax return accountant would instantly know how to resolve these problems.
Needless to say, the bare minimum standard for your tax accountant is that they have to be a Certified Public Accountant (CPA).
Business owners usually describe their business as a team. That couldn’t be any closer to the truth. Each member of this team has a specific role to fulfill. If even one of them goes missing, productivity would surely take a hit.
Your tax accountant should be able to work with anyone in your team. Bookkeeping demands coordination from the different members and departments of your business. They would be working not only with numbers but with people as well.
There will surely be times when you will have to ask more from your team members. It could be filling in for someone who took a sick leave or even working for more hours than expected. Your tax accountant should be eager to do more for the sake of your organization’s goal.
As the day goes by, receipts and statements can easily pile up on your desk. With so many things to do, you might misplace a document or two. When it’s time to write the reports and account for everything, you will probably regret not being organized sooner.
A tax accountant searches high and low for every piece of paper trail that your business has. The sheer amount of documents can easily overwhelm a disorganized tax accountant. However, your tax accountant should be able to systematically organize your business documents, file your tax returns, and do bookkeeping with zero fuss.
If ever an external audit comes to check your books, you can rest easy knowing that everything has been organized and accounted for by your trusty tax accountant. Their accounting method matters more than you think.
Laws and regulations change all the time. They change more often than you can count. That’s why your tax accountant must hold themself responsible for learning about developments in the tax law and new regulations concerning your business.
They must also keep themself updated with the latest developments and innovations in the field of tax accounting. For example, tax accountants now use more complicated and advanced accounting software that makes their jobs easier and more efficient.
An accountant who is stuck in the past will drag your business down.
A business that has a good reputation attracts more customers.
You work hard to keep your business clean and honest. Would you ruin its untarnished reputation by hiring a tax accountant with a dubious background? As the saying goes, a rotten apple can spoil the entire barrel.
When entertaining a candidate, make sure that their integrity is intact. Likewise, when accounting tax and balancing sheets, they should uphold the highest ethical standards. You should feel assured that they will be honest while doing their job even if no one’s looking.
Hiring a tax accountant is a serious matter. Depending on the skills, experience, and values that your would-be tax accountant possesses, they can either be an indispensable asset to your business or lead it towards financial ruin.
Does your potential tax accountant have these traits? If they do, you’re halfway towards greater financial success!
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.
Startup business owners must make this one critical business decision at some point: should they do their bookkeeping or outsource it?
Often, their default decision is to do it themselves.
While there's nothing wrong with DIY bookkeeping, entrepreneurs must recognize the point where they should stop doing it themselves and start considering outsourced Ontario bookkeeping services as a viable option. We will explore that in this article.
As an entrepreneur based in Ontario, you may be torn between doing your own bookkeeping or hiring a certified bookkeeper in Ontario. It's a battle between cost and convenience, and perhaps you're not sure which choice is better.
Here are some valid reasons to do your own bookkeeping.
If you have a good knowledge of bookkeeping, then you can give it a shot. At the very least, you should know how to do journal entries and make debit and credit adjustments.
If your business is new and has less than five employees (including yourself), it's okay to do your bookkeeping. Because the volume of cost and revenue transactions at this point is still low, you can still find the time to do it.
If you have a knack for putting things in order, especially when it comes to money, there's no harm in giving bookkeeping a shot. Accurate categorization is a must in bookkeeping, so knowing which transaction goes where needs good organization.
Bookkeeping is time-consuming. It involves sifting through financial documents and receipts to record transactions.
If you have time to spare and don't mind doing it for your business, you can do your accounting records.
Most business owners who do their books learned it via bookkeeping courses or in college. Unfortunately, their knowledge, while helpful, is not enough. Because of this, they risk falling into traps that certified bookkeepers foresee and avoid.
Here are some of the common pitfalls when you go DIY.
Transposition errors are common even for professional bookkeepers. However, the difference is that a certified bookkeeper can find and correct these errors and avoid making them in the future.
If you're not a professional bookkeeper, you may not notice these errors as you move along the bookkeeping process.
Apart from transposition errors, you risk misclassifying a transaction. For example, you might record expenses as revenue or payables as receivables. These errors might not show up when you do the trial balance, and you'd be left thinking all is well when it isn't.
If you're lucky, you can spot it yourself, but most likely, you'll need the help of bookkeeping services in Burlington, Ontario, or any of its adjacent cities.
Adding to the risk of errors and inaccuracy is the inability to correct the recorded financial transactions. If you do a trial balance and the amounts turn out unequal, that's an indication of an error in recording.
However, finding errors is tedious. If your knowledge is limited, you may hire bookkeeping services in Hamilton, Ontario, where rates are lower.
The answer is pretty straightforward—right now. But if you are still on the fence, here are some indicators that will tell you when to stop doing your own accounting.
The sales are increasing, as are the number of transactions you're recording. It may be gradual, or it may come in droves that will overwhelm you. An increase in the volume of transactions from other parts of your business may increase too, so much that it becomes more complicated to keep track and record all of them.
Sit down and reflect on your business performance. Can the revenue cover the cost of outsourcing bookkeeping services in Windsor, Ontario, or another place? If a bookkeeper takes over, do you think you can earn more as you use your time to get more clients?
Look at your business data. If it screams a loud “yes,” then you should go for it.
Entrepreneurs applying for a business loan need accurate financial statements. These statements will let your banker determine whether or not your business deserves the loan.
Professional bookkeepers can quickly generate that statement for you. Accuracy is important so that both you and your banker can make the best choice.
If you've secured that loan or injected your own money into the business, you want to make sure you’re using it to maximize profits. Thus, you'll need to monitor your cash flows, assets, and liabilities to ensure your business stays afloat while it tries to bring in more money.
In this case, bookkeepers can help you accurately track and record every business transaction, no matter how simple or complex.
Making a decision to outsource your bookkeeping is daunting. Your first impression may be that it will require a lot of back-and-forths and heavy data work.
Bookkeeping services have recently found ways to streamline processes so that you can get the advantages below.
Bookkeeping and accounting technology makes things simple. However, learning them requires considerable time and brainpower that you might rather invest in other profit-generating endeavors.
Outsourcing your bookkeeping is a quick process. It starts with choosing a plan from the service provider; afterward, they will get your business onboarded. It requires little to no effort on your part, and the bookkeeping service will hit the ground running as soon as you give them all the requested data.
Bookkeeping services are dedicated to this task, so you are assured that your books are updated regularly and promptly. When the time comes that you need an accurate financial statement, you'll get it instantly.
You won't have anxieties about being audited or not paying the correct amount of taxes. Professional bookkeepers are trained to record and classify transactions, as well as find and fix errors. You and your auditor will get clean and crisp financial statements and records, making everyone's job a breeze.
Switching from do-it-yourself to outsourced bookkeeping requires turning over all financial and accounting data from one bearer to another. In this case, the bookkeeping service will make sure this transition runs smoothly.
Are you planning to switch bookkeeping services or perhaps sell your business? Your current bookkeeping service provider can give you and the concerned parties all your business data for a pain-free transition and continuity.
Doing your own books takes time, patience, and love for bookkeeping. But if you're more in love with making money than recording it, you can untangle yourself from this complicated process and leave it to professionals at Unloop.
Talk to us, and we'll take care of your bookkeeping with the same love and effort you put into your business.
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.
Startup business owners must make this one critical business decision at some point: should they do their bookkeeping or outsource it?
Often, their default decision is to do it themselves.
While there's nothing wrong with DIY bookkeeping, entrepreneurs must recognize the point where they should stop doing it themselves and start considering outsourced Ontario bookkeeping services as a viable option. We will explore that in this article.
As an entrepreneur based in Ontario, you may be torn between doing your own bookkeeping or hiring a certified bookkeeper in Ontario. It's a battle between cost and convenience, and perhaps you're not sure which choice is better.
Here are some valid reasons to do your own bookkeeping.
If you have a good knowledge of bookkeeping, then you can give it a shot. At the very least, you should know how to do journal entries and make debit and credit adjustments.
If your business is new and has less than five employees (including yourself), it's okay to do your bookkeeping. Because the volume of cost and revenue transactions at this point is still low, you can still find the time to do it.
If you have a knack for putting things in order, especially when it comes to money, there's no harm in giving bookkeeping a shot. Accurate categorization is a must in bookkeeping, so knowing which transaction goes where needs good organization.
Bookkeeping is time-consuming. It involves sifting through financial documents and receipts to record transactions.
If you have time to spare and don't mind doing it for your business, you can do your accounting records.
Most business owners who do their books learned it via bookkeeping courses or in college. Unfortunately, their knowledge, while helpful, is not enough. Because of this, they risk falling into traps that certified bookkeepers foresee and avoid.
Here are some of the common pitfalls when you go DIY.
Transposition errors are common even for professional bookkeepers. However, the difference is that a certified bookkeeper can find and correct these errors and avoid making them in the future.
If you're not a professional bookkeeper, you may not notice these errors as you move along the bookkeeping process.
Apart from transposition errors, you risk misclassifying a transaction. For example, you might record expenses as revenue or payables as receivables. These errors might not show up when you do the trial balance, and you'd be left thinking all is well when it isn't.
If you're lucky, you can spot it yourself, but most likely, you'll need the help of bookkeeping services in Burlington, Ontario, or any of its adjacent cities.
Adding to the risk of errors and inaccuracy is the inability to correct the recorded financial transactions. If you do a trial balance and the amounts turn out unequal, that's an indication of an error in recording.
However, finding errors is tedious. If your knowledge is limited, you may hire bookkeeping services in Hamilton, Ontario, where rates are lower.
The answer is pretty straightforward—right now. But if you are still on the fence, here are some indicators that will tell you when to stop doing your own accounting.
The sales are increasing, as are the number of transactions you're recording. It may be gradual, or it may come in droves that will overwhelm you. An increase in the volume of transactions from other parts of your business may increase too, so much that it becomes more complicated to keep track and record all of them.
Sit down and reflect on your business performance. Can the revenue cover the cost of outsourcing bookkeeping services in Windsor, Ontario, or another place? If a bookkeeper takes over, do you think you can earn more as you use your time to get more clients?
Look at your business data. If it screams a loud “yes,” then you should go for it.
Entrepreneurs applying for a business loan need accurate financial statements. These statements will let your banker determine whether or not your business deserves the loan.
Professional bookkeepers can quickly generate that statement for you. Accuracy is important so that both you and your banker can make the best choice.
If you've secured that loan or injected your own money into the business, you want to make sure you’re using it to maximize profits. Thus, you'll need to monitor your cash flows, assets, and liabilities to ensure your business stays afloat while it tries to bring in more money.
In this case, bookkeepers can help you accurately track and record every business transaction, no matter how simple or complex.
Making a decision to outsource your bookkeeping is daunting. Your first impression may be that it will require a lot of back-and-forths and heavy data work.
Bookkeeping services have recently found ways to streamline processes so that you can get the advantages below.
Bookkeeping and accounting technology makes things simple. However, learning them requires considerable time and brainpower that you might rather invest in other profit-generating endeavors.
Outsourcing your bookkeeping is a quick process. It starts with choosing a plan from the service provider; afterward, they will get your business onboarded. It requires little to no effort on your part, and the bookkeeping service will hit the ground running as soon as you give them all the requested data.
Bookkeeping services are dedicated to this task, so you are assured that your books are updated regularly and promptly. When the time comes that you need an accurate financial statement, you'll get it instantly.
You won't have anxieties about being audited or not paying the correct amount of taxes. Professional bookkeepers are trained to record and classify transactions, as well as find and fix errors. You and your auditor will get clean and crisp financial statements and records, making everyone's job a breeze.
Switching from do-it-yourself to outsourced bookkeeping requires turning over all financial and accounting data from one bearer to another. In this case, the bookkeeping service will make sure this transition runs smoothly.
Are you planning to switch bookkeeping services or perhaps sell your business? Your current bookkeeping service provider can give you and the concerned parties all your business data for a pain-free transition and continuity.
Doing your own books takes time, patience, and love for bookkeeping. But if you're more in love with making money than recording it, you can untangle yourself from this complicated process and leave it to professionals at Unloop.
Talk to us, and we'll take care of your bookkeeping with the same love and effort you put into your business.
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.
So you've landed a spot on Amazon to market your small business, which is excellent news! You're ready to embark on a new journey with plenty of opportunities to expand your customer base, but brace yourself for new challenges incoming, too. In carving your path to success, there are some not-so-fun things you need to work through to accomplish your goals. For example, bookkeeping management is one of the most challenging aspects of Amazon selling.
Small business bookkeeping can be challenging. Having a smaller scale doesn't make bookkeeping and accounting tasks easy to manage. Sometimes, not having enough finances, knowledge, and workforce to handle financial data adds to the company's problems. Moreover, it can be more difficult for a small business owner to take them all at once with Amazon's complex financial system.
So here's an article about the challenges you might face with Amazon bookkeeping. It's significant to be aware of these challenges so you can spend some time contemplating methods to counteract them.
Product launching on Amazon is exciting—the possibilities are almost endless, and the entry requirements are not very strict. Still, sellers face difficulties in bookkeeping and accounting jobs. The most common roots of these issues are the lack of bookkeeping and accounting experience and workforce. As a result, most brands make the following Amazon accounting and bookkeeping management mistakes:
Amazon has a complex system of seller fees (monthly fees, referral fees, and shipping fees via Fulfillment by Amazon (FBA)) which can be difficult to navigate, especially if you lack adequate knowledge and experience on the platform. Moreover, these fees have a more specific breakdown of charges, complicating the system further. Unfortunately, Amazon doesn't provide single-entry invoices that help you get an in-depth understanding of your costs, so it can be very challenging to estimate seller fees.
To successfully manage your inventory, you need a kickass and consistent way of tracking your units. You need to track customs, FBA (if you opted for it), the physical store, and product returns. If you're not using an automated tracking system, it will be harder for you to monitor inventory and update your balance sheets accurately. As a result, it will add an unnecessary burden on your cash flow and prevent you from making the right business decisions.
Product returns are stressful in the first place—you have to keep adjusting the inventory and potentially lose customer loyalty at the same time. It's the negative kind of "killing two birds with one stone." With Amazon, things are more complicated because FBA returns are classified into various categories: sellable, damaged, customer damaged, defective, and carrier damaged returns. It may seem organized at first, but Amazon sometimes makes incorrect inventory placements, making a mess of your books.
Tax preparation can be incredibly challenging for small eCommerce businesses due to the demand for multi-channel tracking. Today's tax regulations are over 10,000, and the variety of these systems is confusing when updating your books. Although Amazon takes the stress of tax collection and remittance away from the seller, you still need to track and accurately state multi-channel transactions in the paperwork to meet tax demands.
Are you looking for a team of experts offering efficient small business bookkeeping services? Then, Unloop might be the perfect business partner for you! We understand Amazon's bookkeeping and accounting challenges, so we want to help you manage them the right way. Our team of small business bookkeeping and tax services experts collaborate with reliable accounting firms to ensure the accurate completion of your books. Through our services, you can focus on growing your small business without worrying about documentation and analysis of financial information.
As a small business seller on Amazon, it's important to properly set your bookkeeping and accounting systems during the earliest stages of online marketing. Finances roll fast, and it can be challenging to keep track of them in a massively complicated marketplace. Of course, you can try learning the basics of financial management, but it will be hard to manage all bookkeeping and accounting tasks independently.
If you find yourself having a hard time learning the processes of Amazon bookkeeping, you can always look for a dedicated expert or team to help figure things out. In addition, by outsourcing your accounting and bookkeeping tasks, you can concentrate your hard work on other aspects of your business.
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.
So you've landed a spot on Amazon to market your small business, which is excellent news! You're ready to embark on a new journey with plenty of opportunities to expand your customer base, but brace yourself for new challenges incoming, too. In carving your path to success, there are some not-so-fun things you need to work through to accomplish your goals. For example, bookkeeping management is one of the most challenging aspects of Amazon selling.
Small business bookkeeping can be challenging. Having a smaller scale doesn't make bookkeeping and accounting tasks easy to manage. Sometimes, not having enough finances, knowledge, and workforce to handle financial data adds to the company's problems. Moreover, it can be more difficult for a small business owner to take them all at once with Amazon's complex financial system.
So here's an article about the challenges you might face with Amazon bookkeeping. It's significant to be aware of these challenges so you can spend some time contemplating methods to counteract them.
Product launching on Amazon is exciting—the possibilities are almost endless, and the entry requirements are not very strict. Still, sellers face difficulties in bookkeeping and accounting jobs. The most common roots of these issues are the lack of bookkeeping and accounting experience and workforce. As a result, most brands make the following Amazon accounting and bookkeeping management mistakes:
Amazon has a complex system of seller fees (monthly fees, referral fees, and shipping fees via Fulfillment by Amazon (FBA)) which can be difficult to navigate, especially if you lack adequate knowledge and experience on the platform. Moreover, these fees have a more specific breakdown of charges, complicating the system further. Unfortunately, Amazon doesn't provide single-entry invoices that help you get an in-depth understanding of your costs, so it can be very challenging to estimate seller fees.
To successfully manage your inventory, you need a kickass and consistent way of tracking your units. You need to track customs, FBA (if you opted for it), the physical store, and product returns. If you're not using an automated tracking system, it will be harder for you to monitor inventory and update your balance sheets accurately. As a result, it will add an unnecessary burden on your cash flow and prevent you from making the right business decisions.
Product returns are stressful in the first place—you have to keep adjusting the inventory and potentially lose customer loyalty at the same time. It's the negative kind of "killing two birds with one stone." With Amazon, things are more complicated because FBA returns are classified into various categories: sellable, damaged, customer damaged, defective, and carrier damaged returns. It may seem organized at first, but Amazon sometimes makes incorrect inventory placements, making a mess of your books.
Tax preparation can be incredibly challenging for small eCommerce businesses due to the demand for multi-channel tracking. Today's tax regulations are over 10,000, and the variety of these systems is confusing when updating your books. Although Amazon takes the stress of tax collection and remittance away from the seller, you still need to track and accurately state multi-channel transactions in the paperwork to meet tax demands.
Are you looking for a team of experts offering efficient small business bookkeeping services? Then, Unloop might be the perfect business partner for you! We understand Amazon's bookkeeping and accounting challenges, so we want to help you manage them the right way. Our team of small business bookkeeping and tax services experts collaborate with reliable accounting firms to ensure the accurate completion of your books. Through our services, you can focus on growing your small business without worrying about documentation and analysis of financial information.
As a small business seller on Amazon, it's important to properly set your bookkeeping and accounting systems during the earliest stages of online marketing. Finances roll fast, and it can be challenging to keep track of them in a massively complicated marketplace. Of course, you can try learning the basics of financial management, but it will be hard to manage all bookkeeping and accounting tasks independently.
If you find yourself having a hard time learning the processes of Amazon bookkeeping, you can always look for a dedicated expert or team to help figure things out. In addition, by outsourcing your accounting and bookkeeping tasks, you can concentrate your hard work on other aspects of your business.
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.
The day is almost over, but the list of department meetings, client calls, and supplier meetups is far from done, but you still push through as visibility on everything that is going on with your business is your top concern. The tasks can be both challenging and assuring. As a business owner, you need to ensure that all parts of your business work well and towards the goals you set.
When it comes to financial goals, you can make your day a bit less overloaded with tasks if you have bookkeepers monitoring the money coming in and out of your business.
We’ll discuss here the seven basic services you’ll get from bookkeepers and what work arrangement is best for your business.
Running a business is slightly the same as running a household only that your business has—more bills to monitor! Some of the bills you need to record are the following:
These are just some of the general bills you need to pay. Of course, the bigger the company, the more bills to account for.
Together with bills monitoring are the creation, recording, and distribution of invoices. Without a bookkeeper, you can pay all your dues, and forget the tracking afterward.
The bookkeeper will ensure that everything is recorded, so when the accountant needs expenses data, a complete record with proper documentation can be provided. With the help of technology, this task is made easier. There are bookkeeping software that allows the storage of receipts, photos, and invoices.
The bookkeeper also documents all the income from actual sales, accounts receivable, and from company assets for both cash flow and profitability checking. Since the bookkeeper also monitors the expenses like taxes and debts, it will be easier to generate reports on gross income and income pre and post-taxation.
Income information is important in growing your business as this is the report investors and future partners would like to see—your business profitability.
The bookkeeper may or may not be the actual person who talks to the bank, but part of bookkeeping administration services is checking all bank transactions and credit card accounts.
Bank and credit card details must match all the expenses and income documents recorded by the bookkeeper. If there are items not accounted for even after rechecking, you can enact an investigation as there may be fraudulent money coming in or out of your business.
Bookkeepers are not only concerned with their ledgers and software that show all financial transactions of the company. They are also great team players who coordinate with different company departments for all money-related transactions.
To make everybody’s time well-spent in the office, the bookkeeper creates a streamlined process of submitting all the income from sales and assets and expenses from purchases, debts, and subscriptions. Think of the bookkeeper as your money tracking executive assistant.
The payroll is one of the many areas of your business where you always want to be accurate as other people are depending on it. Making mistakes can mean demotivation of employees or even loss of trust. Having bookkeeping services for business means there will be a person solely dedicated to doing the following for your employees’ salaries:
How often do you have your business financial reports? With remote bookkeeping/Calgary-based bookkeepers working with you, you can make the reports as often as you can as all the expenses and income are accurately monitored.
Your company accountant can generate reports easily when the data needed is readily available from the bookkeeper. Looking at raw transactions would help, but reports are easier to understand with graphs and tables made by an accountant.
Now, after knowing all the bookkeeping services Calgary-based and remote firms can offer, you might be thinking of signing up for a service. Let us help you know whether you need a part-time, full-time, in-house, or outsourced bookkeeper.
Whether you are thinking of hiring a bookkeeper part-time, full-time, or outsourcing to bookkeeping firms (Calgary or remote services), you are on the right track as you know you need to hire one!
Consider the following:
A part-time, outsourced service may work for smaller businesses, while a full-time, in-house bookkeeper would be helpful for bigger companies. Yet, with the advent of technology, full-time, outsourced bookkeeping consulting services also work.
We are Unloop, and we help business owners selling on, but not limited to, Amazon, Shopify, Walmart, and Woocommerce. Let us help you track your finances, so you can make well-thought decisions and scale your business!
You can put off your plate bookkeeping and accounting tasks and spend your extra time monitoring other equally essential business operations with our remote team. Get all your financial assistance anywhere you are in the world!
You can call us at 877-421-7270 to get started. Talk to you soon!
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.
The day is almost over, but the list of department meetings, client calls, and supplier meetups is far from done, but you still push through as visibility on everything that is going on with your business is your top concern. The tasks can be both challenging and assuring. As a business owner, you need to ensure that all parts of your business work well and towards the goals you set.
When it comes to financial goals, you can make your day a bit less overloaded with tasks if you have bookkeepers monitoring the money coming in and out of your business.
We’ll discuss here the seven basic services you’ll get from bookkeepers and what work arrangement is best for your business.
Running a business is slightly the same as running a household only that your business has—more bills to monitor! Some of the bills you need to record are the following:
These are just some of the general bills you need to pay. Of course, the bigger the company, the more bills to account for.
Together with bills monitoring are the creation, recording, and distribution of invoices. Without a bookkeeper, you can pay all your dues, and forget the tracking afterward.
The bookkeeper will ensure that everything is recorded, so when the accountant needs expenses data, a complete record with proper documentation can be provided. With the help of technology, this task is made easier. There are bookkeeping software that allows the storage of receipts, photos, and invoices.
The bookkeeper also documents all the income from actual sales, accounts receivable, and from company assets for both cash flow and profitability checking. Since the bookkeeper also monitors the expenses like taxes and debts, it will be easier to generate reports on gross income and income pre and post-taxation.
Income information is important in growing your business as this is the report investors and future partners would like to see—your business profitability.
The bookkeeper may or may not be the actual person who talks to the bank, but part of bookkeeping administration services is checking all bank transactions and credit card accounts.
Bank and credit card details must match all the expenses and income documents recorded by the bookkeeper. If there are items not accounted for even after rechecking, you can enact an investigation as there may be fraudulent money coming in or out of your business.
Bookkeepers are not only concerned with their ledgers and software that show all financial transactions of the company. They are also great team players who coordinate with different company departments for all money-related transactions.
To make everybody’s time well-spent in the office, the bookkeeper creates a streamlined process of submitting all the income from sales and assets and expenses from purchases, debts, and subscriptions. Think of the bookkeeper as your money tracking executive assistant.
The payroll is one of the many areas of your business where you always want to be accurate as other people are depending on it. Making mistakes can mean demotivation of employees or even loss of trust. Having bookkeeping services for business means there will be a person solely dedicated to doing the following for your employees’ salaries:
How often do you have your business financial reports? With remote bookkeeping/Calgary-based bookkeepers working with you, you can make the reports as often as you can as all the expenses and income are accurately monitored.
Your company accountant can generate reports easily when the data needed is readily available from the bookkeeper. Looking at raw transactions would help, but reports are easier to understand with graphs and tables made by an accountant.
Now, after knowing all the bookkeeping services Calgary-based and remote firms can offer, you might be thinking of signing up for a service. Let us help you know whether you need a part-time, full-time, in-house, or outsourced bookkeeper.
Whether you are thinking of hiring a bookkeeper part-time, full-time, or outsourcing to bookkeeping firms (Calgary or remote services), you are on the right track as you know you need to hire one!
Consider the following:
A part-time, outsourced service may work for smaller businesses, while a full-time, in-house bookkeeper would be helpful for bigger companies. Yet, with the advent of technology, full-time, outsourced bookkeeping consulting services also work.
We are Unloop, and we help business owners selling on, but not limited to, Amazon, Shopify, Walmart, and Woocommerce. Let us help you track your finances, so you can make well-thought decisions and scale your business!
You can put off your plate bookkeeping and accounting tasks and spend your extra time monitoring other equally essential business operations with our remote team. Get all your financial assistance anywhere you are in the world!
You can call us at 877-421-7270 to get started. Talk to you soon!
Unloop is the first and only accounting firm exclusively servicing ecommerce and inventory businesses in the US and Canada. With the power of people and technology, our team dives deep into COGS and inventory accounting.. You are paired with a dedicated bookkeeping team that prepares accurate financial statements, financial forecasts, and can also pay bills or run payroll for you. Come tax time, everything is organized and ready to go, so you don't need to worry. Book a call with an ecommerce accountant today to learn more.
