This is a video series where I’ll be walking you through a typical process of starting a business and the many different paths this may take you down. This could be your full-time gig, or maybe a side hustle to help fill in the gaps while you’re still working for an employer. Any income-producing activity, no matter how part time, should be considered and treated as a business from start to finish. This will ensure tax and legal compliance as well as set you on the path to profitability.
I’ll be using my own experience as a business owner, my education and experience in tax compliance, and of course, the combined experience of all of the entrepreneurs that I’ve worked with throughout the years to be able to convey to you all the information that I know, as well as ways to make things more streamlined and, ultimately, assist you in being successful in your business endeavors.
If you’re not a current or prospective business owner, you may not find too much useful information in this series, but please free to share this information with any friends or family that you know that have that entrepreneurial sparkle in their eye.
Throughout the series, I will be referencing the checklist on my website called “Business Startup Checklist” as a resource for you to explore and use as we go through this journey together. I like to look at starting a business as the birth of a baby, there’s steps in development and growth that can be directly paralleled to the lifespan of a child. Using this analogy, let’s start at the step of “Am I ready to become a parent, and have a baby?” also known as “Am I ready or willing to have my own business?” I recommend physically writing down or typing out the answers to the questions I will be presenting you – these can then get transcribed into a formal business plan which can be a huge asset to you and your business as you grow.
ASSESSING YOUR OPPORTUNITY & COMMITTING TO YOUR BUSINESS
So, this is Step 1 on both the checklist and the Business Baby’s potential life. No commitments have been made yet, but the idea is definitely planted. You have varying levels of knowledge on the scope of business ownership, but I would like to do a deeper analysis with you to help reach a greater level of certainty and make sure you’re prepared as best possible. This is like taking a parenting class before you even decide to conceive!
Let’s get into the tips I share on the checklist:
1. Determine WHY you want to start a business: This may seem simple, but it’s great to get this down on paper as a starting point for your overall business strategy and objective. This WHY may evolve over time in some ways, but in my experience, the core of your WHY will stay more or less the same over the lifetime of your business. Not only will pinpointing the reasons for starting the business help you NOW, but when you have a solid WHY in place, going back to it even years into your business can motivate you, help to make decisions, and mold the company’s mission. There are lots of reasons you may want to start a business or a side hustle – flexibility, extra income, being able to call the shots, you’re creative and want pursue that passion, etc. These are all great benefits to owning a business or being your own boss, and certainly those goals can come true, but there are responsibilities and risks that every business owner must take as a trade-off to these benefits.
2. Determine whether your business idea fits your strengths and interests. Try a SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis to guide you: Particularly for people who are buying into an existing business, franchise or a network marketing opportunity, you should strongly consider whether that business’ structure and role requirements are a good fit for you. This can be a lot like applying for or taking on a new job and deciding if the roles and responsibilities of the job are something that line up with your values. Again, this is a helpful tool to use not only when deciding to start a business or not, but throughout your strategic planning and the day-to-day running of your business. This is a bit like a more thorough pros & cons list for you:
STRENGTHS: This is a great place to start when trying to determine how can drum up business – look at your hobbies and skills – are you great at writing? Gardening? Sewing? Do you have a competitive advantage in any of these fields?
WEAKNESSES: Here we are taking an honest look at our own shortcomings – maybe you don’t like sales or have below-average organizational skills – these don’t necessarily mean that you can’t start a business, but at least you know you would have to plan to either improve these skills or have enough revenue to be able to afford staff to fill in those gaps. This is also a good time to determine your non-negotiables in business – for example, if a big part of your WHY is to spend more time with your family, you may not want to go into a business that is going to require a lot of travel or time on the road.
OPPORTUNITIES: These are your external factors that will enable you to open and grow a business. Maybe you see there’s a new trend emerging in a certain type of hand-made item that you know you can make, or your house already has an amazing office space in it. Maybe you already have potential customers wanting to pay you for your services. Another strategy here is to look at your potential competitors and identifying what their weaknesses are. These are all opportunities to be considered.
THREATS: On the flip side, these are external factors that will impede your ability to open or grow a business. A good example would be market saturation or a downturn in the economy – these are factors that you can’t control, so here we determine if these threats outweigh our opportunities.
When we look at this whole picture together, we can develop a strategy to make the business work or go back to the drawing board.
3. Logistical Detail: If you’ve made it past step 2, and you still want to start this business (or have this baby), we start to get a little more detailed in what this is going to look like – using your SWOT analysis and WHY, decide whether you want to provide a product or a service; build an online business or bricks and mortar, if you’ll want to be working full-time or part-time.
4. Target Market Detail: This is also a great time to really get a firm understanding the problem(s) your business will solve for your potential customers. Evaluate how customers solve this problem currently, as well as what the competition offers - their strengths, weaknesses, pricing structure, how they market, and their offerings. This will lead you to define the market you want to pursue, your target customer, and how you will position yourself within that market. While these decisions will surely not be set in stone, you need to start somewhere with your business plan, and making these items your focus now rather than months or years down the road will save you time, money and frustration in your marketing attempts.
5. Test Your Ideas: Now that you have your logistical and target market details, you can start asking other people for feedback. It can be hard to see the forest through the trees when you are so close to the idea itself. Ask friends and family, or even better yet, potential customers what they think of your idea(s) and the details. This feedback will be invaluable to you – it’s like getting advice from seasoned parents – maybe not all of it will work for you or align with your values, but knowing upfront if your ideal customer hates one detail of your plan and that’s the deal-breaker for them is priceless.
6. Don’t forget about the money: You know I would never recommend making any decision without considering the money side. If you were asking me if you should consider starting a family, you can bet that I would ask if your budget will allow for it. When you’re in this stage thinking about starting a business, create a quick financial plan – it doesn’t need to be down to the penny, but you need to have a general idea of if it will be profitable, and how long it would take to get you to profitability – how much money do you need to invest to get it started? How many sales do you have to make before you become profitable? How much capital do you need to risk, and how long will that capital last?
We will get more detailed on legal start-up costs next week, but don’t forget business licensing, insurance, and incorporation costs if necessary – even if you’re working out of your home and you don’t need to worry about inventory because you’re running an online, service-based business, you’ll still need to consider those costs.
If you’ve gone through all of these steps and decided that you’re ready to commit to this amazing adventure of having a baby or starting your business, join me next week for the next phase – it’ll be a bit like nesting for your baby, or preparing while you’re still pregnant – getting all of your ducks in row so you can start your business off on the right foot.
Just like the last episode, we’ll be using the analogy of having a new baby – this time, you’ve made the leap and gotten pregnant – this baby is coming! Let’s get ready.
SETTING UP YOUR BUSINESS
Let’s get into the tips I share on the checklist under step 2:
1. Decide on a legal structure: There are 3 major structures your business can take on – a sole proprietorship, a corporation, or if there is more than one owner, a partnership.
SOLE PROPRIETORSHIP:
Particularly for people who are buying into an existing business, franchise or a network marketing opportunity, you should strongly consider whether that business’ structure and role requirements are a good fit for you. This can be a lot like applying for or taking on a new job and deciding if the roles and responsibilities of the job are something that line up with your values. Again, this is a helpful tool to use not only when deciding to start a business or not, but throughout your strategic planning and the day-to-day running of your business.
A sole proprietorship means that there is no legal separation between you as an individual and the business. You would file your taxes on a regular personal T1 tax return, just with the extra schedule T2125. You are the sole owner of the business.
ADVANTAGES:
Easy and inexpensive to register – you can trademark a name if you wish, and you should get a business license (which we will get into later), but there are no incorporation fees to register or renew
Regulations are lighter – there is no requirement for a separate bank account or a minute book
If there is a business loss, it can create a tax advantage for you as it will lower your overall taxable income
All profits go to YOU directly without having to worry about payroll or dividends
Lower accounting fees – because you are doing a T1 return, your yearly tax bill will be much cheaper than a corporate route
DISADVANTAGES:
Any liability your business faces is your personal liability as well. So, if a customer sues your business, they can pull your personal assets into the lawsuit including your home, vehicles, savings, etc. You are solely responsible for all debts and obligations related to the business.
Any profit from the business would be taxed at your personal tax rate (which depends on what your total taxable income is – this could include employment income, rental income, pension income, anything else) – this is higher than the corporate rate
The business dies with you and ownership is not transferable
This legal structure can also be in the form of a partnership, meaning it’s still not incorporated, but two or more people have combined resources to create the business. You and your partner(s) would then share in the profits according to the legal agreement you have drawn up. I pretty well never recommend this structure for a partnership, I would always want to lean toward incorporation when there are several people involved, even in a spousal scenario. I would also STRONGLY recommend having a lawyer help you with your partner agreement because things can get ugly FAST.
CORPORATION:
A corporation is a completely separate legal entity. You can incorporate provincially or federally. I would recommend seeking legal counsel when incorporating. You should also be aware of something called Personal Services Business. CRA has stated that corporations that are opened for the sole use of working for one company essentially as an employee should not get the tax advantages that typical corporations get. A good example of this are oil field workers that are technically subcontractors to Shell or Suncor, but have non-compete agreements with them, always work the same hours, never invoice Suncor, just get paid direct deposit – these types of corporations need to be careful – get 1:1 advice if this is you.
ADVANTAGES:
Limited liability protection for your personal assets in most cases. There are cases where a shareholder might have to personally guarantee a loan for the corporation, or if there is debt regarding payroll source deductions or GST, the shareholder could become liable for those, but for the most part, a corporation is considered completely separate from the shareholders.
Ownership is transferable and continues after shareholders die
It may be easier to secure loans or financing with this structure rather than a sole proprietorship
Possible tax advantage: profits left in the business (meaning not paid out to owners) are usually taxed at a lower rate than personal tax. Also, losses can be carried forward or backward to even out higher and lower profitable years. If you do not plan on keeping profit in the corporation, there is no tax advantage.
You can have many owners or shareholders with different amount of stakes in the business
DISADVANTAGES:
A corporation is closely regulated – you need separate bank accounts, a minute book, and your accounting should follow Generally Accepted Accounting Principals (GAAP) – doing taxes will cost you more as the tax forms are much more complicated and require more detail – at minimum, bookkeeping and everything combined, you’re looking at least $1,000 a year, more if you’re going with a CPA firm.
More expensive to set up – I recommend having a lawyer process the corporation registration and renewals for you – they will also set you up with a minute book and make sure your shares are properly distributed and everything is legally sound. I have a wonderful Edmonton lawyer I can refer you to if you would like a recommendation. It’s about $1000 to do it this way, and then about $325/year for renewals after that.
Your liability insurance may be higher - this is dependant on your industry but typically a corporation would pay more in premium than a rider on your personal insurance
2. Decide on a name:
Whether you are incorporating or not, you can decide if you want a specific name for your business or if you just want to leave it as your personal name (for a sole proprietorship) or a numbered company (for a corporation). If you decide you want a different name, you can visit a registry to do a search to make sure that name or something extremely similar doesn’t already exist. As long as that name isn’t taken, it’s distinctive, and not intentionally misleading, you can then trademark your name right there at the registry. You then keep that name until you decide to legally change or cancel it.
3. If you have incorporated, you will need to call CRA Business Line to apply for a business number. Regardless of whether you are incorporated or not, you may also want to open a GST account and/or a payroll account. For GST, assuming you are selling a product or service that is NOT exempt from GST, you don’t actually HAVE to open a GST account or start charging GST until you have reached over $30,000 in revenue over a rolling 4-quarter period, so most business’s wouldn’t concern themselves with this right at the start BUT there are circumstances where you may:
Your potential client wants you to have a GST number
You will have a lot of start-up costs that involve GST – if this is the case, you may want to apply for it right away so that you can claim a refund on those costs – these are called ITC’s (Input Tax Credits) and you can only use them if you actually have a GST account open when you make the purchase.
4. Apply for an appropriate business license: Here is the City of Edmonton business licenses page for you to look at, but if you are not in Edmonton, just do a google search on your city – whether you are running your business from home or another location, you will likely need at least 1 business license, maybe more if you are planning on selling food items or in a regulatory industry like a dayhome or a bar.
5. Open a Business Bank Account: So I did say earlier that if you have a sole proprietorship, you don’t legally need a separate bank account, but it will make your bookkeeping life much easier if you do. Look around for a low cost option, and you might be able to find somebody who also offers a payment solution if you want to have a debit card machine or what have you. If you’ve opened a corporation, it’s mandatory to have a separate bank account in the corporation’s name and if you want a credit card, that will need to be a corporate card as well. Kind of related to this category is a business loan, financing and funding – we will be getting into that more in the next video, so stay tuned for that.
6. Accounting: Speaking of receipts, now’s a great time to establish your company’s accounting plan: hire an accountant and/or bookkeeper, select your accounting system (highly recommend QBO and I provide training or just full service on it), and determine your fiscal year-end if you are a corporation. If you are a sole proprietor, your fiscal year end will be December 31 to follow the calendar year. If you are a corporation, you can choose in the first year. Lots of people like to keep the calendar year so that all of their personal and business taxes are happening around the same time, and payroll is in line with your year-end. On the other hand, if your business is very seasonal, you might consider a year-end that doesn’t fall into your busy season so you have the time to deal with taxes. Here are some dates to consider:
Sole Proprietorship
Year-end is December 31
Taxes and annual GST are due April 30 (unless CRA requires that you pay installments, but that’s not something you need to worry about in the first year of business)
T1 return and annual GST is due June 15
GST can be set up to be paid monthly or quarterly as well if you prefer that
Corporations
Taxes are due either 2 months or 3 months after year-end, depending on the amount of gross revenue you make and the type of income the corp receives
T2 tax return is due 6 months after year-end
GST is due to be paid and filed 3 months after year-end
Payroll: Source deductions are always due on the 15th of the following month, and T4’s are due Feb 28
If you are my client, I always send reminders of these due dates to make sure you are meeting deadlines and avoiding penalties!
7. Insurance Needs: Evaluate and select needed insurance policies for your business: think liability, contents, buildings, vehicles, WCB if you have employees, health insurance, disability, life – again, I have a handful of super smart and amazing people that help you with basically any insurance need so let me know if you need a connection.
8. Get an internet presence: Now that you know what name you’re operating under, register the domain names and social accounts. Get your website up and running. If you’re internet savvy, you maybe are able to do this yourself, or hire somebody to do it – I have a recommendation for this type of service as well if you like, or you can do that research on your own. Keep receipts!
This episode, we are in the third trimester of our pregnancy, so we are just about ready to launch, and tying up the final loose ends to make sure we get started on the right foot.
ENSURING FUNDS ARE AVAILABLE
We did the precursory planning of this in episode 1, where we forecast the capital that would be required, so now we are actually going to be finding and securing that funding if you don’t already have it available. There are a few different sources that you can investigate:
1. Grants or Non-Equity Investing: Typically, grants or non-equity investments don’t need to be paid back, and they are usually the first source I would recommend because it will impact your bottom line the least. There are several sources for this in Canada, I will link a whole plethora of this type of funding for you to look through, which includes the Government Program Search website, and for certain industries, I would also suggest doing some research on crowdfunding, through popular websites like Kickstarter or Gofundme. Grant and non-equity investments are considered taxable income for the business.
2. Equity Investing/Capital Investments: With this type of funding, you are trading a portion of your ownership in the business for money. There can be many different types of agreements that go with this type of funding. Typically, capital investments are not taxable to the business as you are trading a portion of the ownership (or shares) in return for the funding. If that investment grows, and dividends are paid out as a result, those dividends become taxable to the shareholders.
3. Loans: There are many sources for getting repayable financing – I want to specifically mention Futurpreneur and BDC. Of course, interest-wise, it’s always a good idea to look for non-interest bearing loans first – think friends and family! Funding that you receive from loans is not taxable income, and the repayments that you make on the principal of the loan are not tax deductible, but any interest or loan fees that you pay are tax deductible.
Keep in mind that with any of these options, you will likely be required to have a full business plan in place. This ensures to both you and your investor or financer that the business has a plan in place to either repay the loan or use the investment wisely without going under. Check out the Futurpreneur Business Plan writer to get started. I’m also always seeing workshops and things pop up and I try to share those on my page as much as possible. In my opinion, having a professional write your business plan for you is a good way to get an outline, but honestly, a true business plan should be coming from you – it’s your baby. You know it best. And remember, just because you write a business once doesn’t mean it’s set in stone – a good business plan is meant to evolve and change over time.
SYSTEMS & PROCESSES
In my opinion and experience, this is one of the biggest places that gets ignored when a business gets started – often, owners are struggling to put these in place in a time of growth months or years into the business’ life, and it’s much more difficult to start from scratch when you’re already knee-deep.
Putting systems and processes in place (think: writing it down!) before you even launch is a delicious time to take this action. First of all, you have the time to really sit down and think about some of these things. Second, I can’t express to you enough how grateful you will be to already have these basics in place when you need to hire a new employee or make a major decision in your business. Here are some of the processes and policies that you should be planning now:
Operating hours
Key suppliers
Contingency plans
Seasonal adjustments (if your business is seasonal, what is your plan for cash flow and creating off-season income?)
Location: Are you working out of your home, online, or in a brick and mortar store?
On-boarding clients & customer service policies (i.e. returns, shipping, reminders, etc.)
Inventory and accounting processes
Staffing: Identify employee or contractor needs. What is the profile of an ideal employee or contractor? What will your recruitment and hiring process look like? How will you train? How much will you pay? What benefits will you offer? Do you need contracts or non-disclosures in place? I think I may do an entire video on what employers need to know, so let me know if you’d be interested in that!
SETTING UP TO OPERATE:
This is the time you are spending searching for, moving into, possibly renovating or otherwise preparing your workspace. Even if you’re working from home, online, or from your vehicle, there is some planning at play here. At the very least, you should have a filing system in place for your business’ receipts and statements (see episode 1) where the risk of damage is limited. If you’re working out of your truck, that is likely going to mean having a sturdy plastic bin with hanging files for receipts and maybe a rugged case for your tablet or laptop. Some other things that may need to be considered are:
Computers or workstations
Office furniture
Telephone/fax/e-mail contact solution
Inventory storage solution
Point of Sale system
Client meeting area
Signage and banners
Security system
Employee break area
Design & layout of office area
This is also when you are hiring and training staff – before the door opens!
MARKETING YOUR LAUNCH:
I am by no means a marketing expert, but I have certainly learned a bit along the way of running my own business and the collective experience of all of my clients, and so I’ll tell you through my filter what I think is really important when marketing your business and particularly, the launch of your new business:
1. Positioning: Pre-launch is a great time to determine where you want to be positioned in the marketplace. Chances are, somebody out there is already doing what you’re doing. How do you want to compare to them? You can position based on price, quality, location, service, etc. Start with your values and what’s important to your ideal customer, and make sure that your branding and marketing reflects that.
2 . Tracking ROI (Return on Investment): Of course, I am profit-focused. I want to make sure that whatever marketing strategy you use, you are tracking the profitability surrounding it. I have found the best way for me personally to track this is to make sure I’m asking my potential clients how they heard about me. I then track that sale based on the marketing source, and at the end of certain period of time, I can see if that investment actually paid off for me. For example, if I spend $100 on Facebook ads, and I get 2 sales directly from those ads, totalling $150, I know that I effectively profited by $50.
3. Deeply Understanding Your Client: One of the major things I think I’ve learned is that the client is the hero, not you. You are the guide that is solving the client’s problem, or helping them find the solution. Don’t market yourself as the hero – you are the guide. In order for you to be the best guide possible, it’s really important that you spend the time understanding your ideal client’s needs and wants – this is everything, from the way that you talk to them, the words you use in your copy, your logo, how bright the light is in your facility, how your package your goods…etc!
4. Confidence and believing in what you do: For me, and I think probably for a lot of people, this is the life-long learning and growing process. You need to stand behind what you do and a lot of times that means believing in yourself and your product or your service. You really, truly need to know that what you’re offering is important and worthy of somebody trading money for it. This can be hard, not only to really get there yourself, but to be able to communicate it to clients, but the reason that I’m pointing it out is because I don’t want you to think you’re a failure at business because you feel you aren’t good at sales. Unfortunately, sales is part of every business, so it’s a muscle you’re going to have to flex. Know that your confidence will grow over time and your sales skills will grow along with it.
Tactically, the steps you need to follow here are:
Preparing Business cards, brochures and other printed marketing material you may require
Posting on social media – like I said in the last episode, if this is your strong suit, great, if not, there are many professional options you can take to get the word out
Investigate e-mail marketing, blogs and SEO strategies to drive traffic to your website. If your business is going to have any kind of online presence, I recommend looking into anything by Amy Porterfield, she is a bit of an online marketing guru and I’ve learned a lot from listening to her podcasts and doing her webinars.
Research networking opportunities in your area – I know networking isn’t for everybody, but it is a great way to increase your visibility in the marketplace, which is exactly what you should be focusing on right now. A tip that has helped me with my networking fears is this – don’t go into a room trying to trade as many business cards as you can. Make your goal to find and meet 1 kindred spirit. You usually know them when you see them. If you can find that 1 person who is cut from the same cloth as you, that relationship is likely going to be more valuable to you than 35 business cards in your pocket. Networks should be deep, not necessarily wide.
Research news and press releases (for certain industries)
Create a buzz! Be excited, get other people excited. Don’t let haters get you down.
Here are my best tips on how to run and grow a successful business post-launch. The first part of the video will focus on the TOP DO’S and DON’TS OF RUNNING A BUSINESS and then we will get into recurring tasks you should be on top of as your first year progresses.
DO be obsessed with time and energy management. I think I give tips on this in pretty much every video I’ve done because it’s become so important to me in my life as a business owner and mother and wife and friend. There are certainly times that I still feel overwhelmed, but as the years have gone by, and my business has grown, efficiency has become more and more important to me, and to me, the straightest path to efficiency is systems and processes. If you go back and watch episode 8, I listed my favorite business apps that can really help in this area.
DO become a life-long learner. Always be searching for ways to develop your skill set and expand your knowledge, even beyond any mandatory continuing education you have to do for your industry. Read books. Listen to podcasts. Take courses. There are SO many FREE resources out there, you could literally spend all of your time on free resources and never run out, so take advantage of what we have and use your time here on earth to learn.
DO set smart goals – I won’t spend a lot of time on this because I have done an entire video on it – check out episode 9 for more information on setting smart goals.
DO focus on profit. Profit doesn’t always mean you need more sales or chasing more money. Sometimes it means cutting your expenses and focusing on freedom and long-term success rather than instant wins. If your personal financial situation is dire, chances are your business financial situation won’t be much better. You need to work on both in tandem. Check out my episode 5 for lots of info and resources on business budgets and planning on profit.
DON’T get discouraged! Just like raising a child, running a business is a long winding road with tons of peaks and valleys. The first years can be rough, with a big learning curve and unpredictable behaviour. Seek advice. Enjoy the process and know that you are gaining resilience to it. Failure and doubt are a part of growing and we all go through it.
DON’T get behind on taxes. The CRA has teeth and owing money to them or being behind on filing is stressful and expensive, and can ultimately sink your entire business. When you decide to take on the responsibility of owning and running a business, you are taking on the obligation of tax compliance.
DON’T try to do everything yourself. Use your SWOT analysis to discover what tasks are going to take a lot of energy for you to learn and do well – would this energy be better suited to grow your business? I don’t necessarily mean that you need a full-time employee, but can you source out some of your admin tasks through fiverr or a super organized friend? Or, on the personal side of things, can you trade something for a house clean or babysitting? Sticking to your budget is important, but don’t let your task list undermine your overall goal.
DON’T stop evolving. As I’ve said in previous episodes, your business plan and your goals will change, expect to change with them. Something that is a big advantage for small businesses is the ability to adapt easily – bigger organizations can have a hard time with adapting to industry changes or economy shifts because they have so many staff and a lot more moving pieces. If you keep yourself and your business adaptable, that will be a driving force for success.
DON’T forget about customer service. If you think back to WHY you started this business, I’m sure there was an element of helping yourself but also of helping others by solving a problem with your product or service. Don’t ever lose sight of that – your clients are your lifeblood – keeping the main focus on the hero (your client) is the best thing you can do for your long-term success. This means appropriate and timely communication, being a good leader for your staff if that’s applicable, under-promising and over-delivering, and a lot of patience. I don’t mean that you need to let customers walk all over you, or even that the customer is always right. What I do mean is that your business should be service and relationship focused, and that means that the customer is always HONORED.
Recurring Tasks
All of the work that we did in the past 3 episodes are ongoing tasks, so there will be things that you need to do on a regular basis:
1. Weekly or Monthly Basis:
Track your budget – again, see episode 5 for a detailed look at how to set up a business budget and stick to it. This includes saving for taxes so it’s a really good idea to keep on this at least monthly. The further you get behind on something like this, the bigger the burden can become
Track your Profit & Loss – you should be getting monthly financial reports showing exactly what money came in and what money went out every month – also, if you haven’t already opened a GST account, you’re going to want to keep your eye on your gross sales YTD, because once you reach $30K, you are required to open a GST account (for most industries)
Track your wins & losses for the month – even a 1 page journal entry or a quick staff meeting if you have staff can really help to re-centre you and everyone involved
Payroll – if you have employees, you are likely on a monthly payroll remittance schedule with CRA – this means you need to pay your employees on a regular basis and remit your source deductions on the 15th of each month – again, I will likely do an entire video on this subject
Inventory – this depends on the volume of inventory that you are dealing with, so this is in both monthly and quarterly sections – you should be doing a regular count of your inventory, not only for tax and insurance purposes but for your own records as well
2. Quarterly:
Review your SWOT analysis & business plan – this is a little bit like the track your wins & losses but more in-depth. Episode 12 delves into how I conduct my quarterly reviews, where I plan my entire next quarter from marketing campaigns, subscription audits, budget analysis, etc.
GST – You may be on a quarterly, monthly or annual remittance cycle with CRA – if you are on quarterly, you will need to file and pay your GST 1 month after each quarter end
3. Annually:
Corporation annual renewals and minute book updates
Business license renewals
Insurance policy renewals
Lease renewals
T-slips – T4s for your employees, T5s if your corporation pays out dividends to shareholders, T5013’s if you are in construction and have subcontractors – these all need to be completed and filed yearly
Other industry-related certification renewals
Taxes! You’ll be completing your year-end and filing your tax return If you’ve been on top of your finances, getting monthly books done this will be a LOT easier and cheaper for you. Also, since you’ve budgeted for it, you should have your tax either saved or already paid in installments. In addition to your income and expenses for the year, it’s important to note that upon your year-end, you should have an accurate recording of:
*AP
*AR
*Inventory
*Bank account balances
*Loan balances
If you haven’t been doing monthly bookkeeping, check out episode 1 for tips on how to organize your paperwork when you have a lot to sort!
I hope this series of videos has been useful and sparked a entrepreneurial light in you.
