IF YOU ARE INCORPORATED, YOU SHOULD HAVE AN ACCOUNTANT

We don’t mean to be biased because we are accountants, but it’s the truth.  If you have a car, you hire a mechanic. If you have teeth problems, you see a dentist. Likewise, business owners should hire an accountant to help with their bookkeeping and tax work. Here is why:

1: You are busy enough as it is.

Let’s face it, you should be spending time growing your business–not learning things you can hire out.  Your time is valuable. You don’t have the time to understand all the corporate tax laws that exist and choose an adequate bookkeeping/tax filing software, much less learn how to use it. Your time is much better used to work on your business and to grow your profits rather than analyzing them. By hiring an accountant, you do not need to worry about keeping up to date on the Income Tax Act or spending money eventually to fix  your errors.

2: Without an accountant, you could be paying much more tax than you need to be.

Accountants are experts in identifying areas where you could be claiming deductions or credits that you are likely to miss if you are inexperienced in filing taxes. Moreover, by having an accountant throughout the year, they can guide you in making certain decisions to maximize your deductions and develop a strategy. They are also likely to be much more up to date on changes and new benefits that you could take advantage of.

3: You may run a higher risk of failing an audit. 

If you are selected for a tax audit, it is a lot of work and stress. Thus, it is a better idea to aim to avoid one altogether, which an accountant can help you do. Audits can be triggered by many things, and accountants can help to ensure that those red flags do not appear on your tax return. Furthermore, as they are fully knowledgeable on tax regulations, it will decrease your risk of being audited due to failure to follow the rules. Overall, an accountant will be able to educate you on the best practices to avoid audits as well as help you through them in the case that you need to complete one.   You don’t want to fail an audit. It can be very costly and that does not include the opportunity cost.

4: It helps to ensure the longevity of the business.

A key role of accountants is to create risk analysis tools to help you evaluate various business risks and opportunities. By having an individual on the team who has this expertise, you significantly decrease the risk of having the business fail due to poor financial management. Furthermore, the financial analysis tools used by accountants allow them to create high-quality forecasts and budgets, so that your finances are managed effectively, even for simple day-to-day operations. Considering that many businesses fail due to lack of planning and capital management, the role of an accountant is greatly valuable.

As you can see, accountants can provide value to your business beyond simple bookkeeping. It is a good idea to hire an accountant early on, so that they become familiar with your business before it becomes overwhelming. Besides accounting there are three other areas of financial planning for your business.  We will discuss these in further detail in further blogs. These include insurance, investments and financing or mortgages.  At MrTaxes.ca, we offer corporate accounting services – set up a free phone consultation with us at: www.MrTaxes.ca/meeting to learn more!

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