It’s tax time again: Are you ready?

by | Feb 2, 2024 | Finance and Business

If there’s one thing you can count on every year, it’s that April 30th – or the first business day after it – is the deadline for filing our taxes. Are you ready? If not, here are four tips to help you plan for the big day.

Get organized
If you’re a salaried full-time employee, organizing your taxes should be fairly easy. Get your T4 from your employer and collect any earnings slips for your investments. But if you’re self-employed or run a business, there is a lot of paperwork to go through, including expenses for everything from stationery and client meals to equipment and work-related travel. The sooner you get those receipts organized, the easier it will be to complete your tax return.

Note that if you are self-employed, the deadline for filing your taxes is June 17, 2024, but if you owe any money on your return that will be due on April 30th or you’ll face penalties and interest for late payment.

Top up your RRSPs
This year, the deadline to make contributions to your registered retirement savings plan (RRSP) and get the deduction on your 2023 taxes is February 29, 2024. Any amount you invest in RRSPs will be deducted from your annual income for the year, and potentially earn you a refund. If you do get one, consider investing it in your tax-free savings account, the registered educational savings plans you have for the kids or get an early start on next year’s RRSPs.

Clean up your files
You’re required to keep any receipts or other documents related to your taxes for six years after filing. Once you’ve completed your 2023 return, pull out any 2017 or older documents and get rid of them. You should also purge any documents you filed away but don’t really need, such as receipts for things you can’t claim as deductions. Use a shredder to destroy anything that has personal information on it, including your social insurance number or your signature to protect yourself from fraud.

Automate your business books
If you own a business and are not already using cloud-based accounting software, you may want to look into it this year. With a cloud-based accounting program such as FreshBooks, you can automate things like invoicing and sending out late-payment reminders to help with your cash flow. Everything is automatically backed up, and you can set up your accountant within the platform, which gives them real-time access to your financial data so they can offer you the best help. Small business owners can also apply for the Canada Digital Adoption Program to help fund cloud-based accounting solutions.

Learn more about cloud-based accounting at freshbooks.com

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