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E-Myth – “Why most small businesses don’t work & what to do about it”

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Outsourced Accounting Services | Accounting For Proprietors

There is two different types of businesses that an entrepreneur can operate says outsourced accounting services. There is the proprietor and the corporation there are many benefits that an entrepreneur has with a corporation, but it is not necessarily the only correct way to run a business. In order for a business owner to make the proper decision, they should understand the differences between corporation and proprietorship. The biggest differences between the two is that a proprietorship is an unincorporated business that is tied to the business owner and the business owners and tax obligations. A corporation on the other hand is a separate legal identity that exists for tax purposes.

If an entrepreneur has discovered the differences between both, and have decided that they are better off running a proprietorship, then they should understand how to file those taxes properly and do their accounting. The requirements for taxes as well as accounting are very different for proprietors versus corporations, and by gaining that all understanding right away, can help entrepreneurs run their business efficiently says outsourced accounting services.

The first thing that entrepreneurs should keep in mind, is that the accounting requirements is extremely different between proprietorships and corporations. While a corporation needs to worry about something called a double entry accounting system, this is much more difficult to do, and requires accounting software like Sage, zero or QuickBooks. Even though it is harder to do, more time consuming and require special software, it is much easier to ensure the accuracy of. However, proprietors only need to worry about something called a single entry accounting system which does not even require entrepreneurs to have to get accounting software. This not only can save them significant amounts of time in not having to learn that software, but is going to save the money from saving them from having to buy additional software in their business. However with single entry accounting, this is essentially an entrepreneur just keeping track of all of the expenses in their business and all of the revenue in their business. It can be done in any spreadsheet program, or literally by paper and pen and a ledger book. Even though it is less work, and takes less software, entrepreneurs may find that it is a lot easier to make mistakes this way, because there is no built in double check system that there is in double entry accounting.

Keeping these things in mind as they learn how to keep track of their taxes, revenue and expenses as a proprietor, can help business owners ensure that they are being as there was possible when it comes to their business expenses and revenue. Outsourced accounting services says that this can help significantly with business owners, not only keeping track of all their expenses, but making plans to grow their business even more. Just because an entrepreneur is running a proprietorship, does not mean that they do not have plans on growing their business significantly into the future. By learning how to do proper accounting now, can help entrepreneurs increase their chances of making those great decisions later in their business. When they do that, literally the sky is the limit on how much their business can grow into the future says outsourced accounting services.

Outsourced accounting services | accounting for proprietors

There are several differences between a proprietorship and a corporation says outsourced accounting services. By understanding not only the differences between the two, and the accounting requirements between the two, can help entrepreneurs keep proper accounting for their proprietorship. This can help them understand more accurately the revenue their generating in their business, all of the expenses that they have in case they need to minimize those expenses and everything else they need to do in their business to grow it as a proprietor.

Business owners that own proprietorships also have a different tax deadline. Not only are their personal taxes now do on 15 June instead of April 30, but that is also when their proprietorship taxes are also do. Instead of a corporation deciding when there year end is going to be, and owner of a proprietorship does not get to make that decision. The good thing is they get to file their personal and their business taxes away at the same time, eliminating the need to do two different taxes seasons in their life. Not only do entrepreneurs with proprietorships get to push their filing date back forty-five days, but spouses of those proprietors can do the same for their own businesses as well. The have a different form that they need to fill out for their business and provide is alongside their personal tax return can ensure that entrepreneurs are filing their taxes properly. Outsourced accounting services and says that business owners do need to keep in mind however that while June 15 is there filing deadline, if they owe any taxes, Canada revenue agency starts calculating interest at April 30. This is not the same as a penalty, because it is only a 1% l interest charge per month and a late penalty is much higher. Although business owners can get a late penalty if they decide to file past the June 15 filing deadline.

Another thing that entrepreneurs should keep in mind as a proprietor, is that in order to help keep their accounting organized, outsourced accounting services recommends that they have separate bank accounts and credit cards. Not only can this help an entrepreneur keep accurate accounting with their single entry accounting, because they only have one bank account and all the transactions and that what account to go through to ensure the accuracy of, but it can also provide a layer of protection in case Canada revenue agency decides to audit that proprietorship. When everything is coming out of the separate account, they will have a much easier time proving to Canada revenue agency the flow of money in their business. Regardless of how an entrepreneur decides to keep their financials, it still mandatory for business owners whether they own corporations or proprietorships that they keep all of their receipts in their business, or at least keep copies of those receipts in their business for up to seven years. Once they understand this, they will be much more prepared to operate their business.