Canadian Tax Season in a COVID-19 World

Are you ready for the upcoming tax season?

2020 was certainly a doozy of a year, and fortunately, it’s ALMOST over! Of course, 2020 has ended, but there are still some loose ends to tie up, as the 2020 tax season is on the horizon. Things might be a little more complicated when it comes to both your personal and business-related taxes this year, but with some guidance, we can finally close out last year for good!

Some Important Dates

There are many important dates that you need to keep in mind for the upcoming 2020 tax season:

  • Feb. 22: Canada Revenue Agency opens eFile for the 2020 tax year.
  • Mar. 1: Final deadline to contribute to your RRSP to apply to the 2020 tax year.
  • Mar. 1: Final deadline to issues all T4, T4A, and T5 slips.
  • Apr. 30: The personal income tax filing due date for those who are NOT self-employed. Taxes payable due for both individuals and those who ARE self-employed.
  • Jun. 15: The personal income tax filing due date for those who ARE self-employed. (Note: Taxes payable are due on April 30th.)
  • Jun. 15: Deadline to file GST/HST returns for self-employed annual filers with Dec. 31, 2020 year-end.

Tax Deadlines Currently Unchanged

As of now (end of February 2021), all tax deadlines are unchanged, and there do not appear to be any plans for extensions.

This marks a considerable change from the 2019 tax year when the pressures of COVID-19 pushed due dates and deadlines to later in the year. While we’re currently in a very different position than we were in March of 2020, there are still tremendous pressures on both individuals and businesses.

Theoretically, the continued crisis could result in a future announcement from the CRA about potential extensions, but as of now, this isn’t the case. Therefore, you cannot afford to put off your tax preparations, as that could result in late fees and penalties.

Of course, we’ll keep in full contact with our clients about any changes to this state of affairs in the near future.

The Canada Emergency Wage Subsidy (CEWS)

The CEWS is a program introduced earlier last year to help businesses that lost revenue cover part of their employees’ wages, retroactive to March 15th, 2020. It’s taxable for income purposes and must be included in corporate or partnership income tax returns.

Personal Taxes

If you took advantage of a program like the Canada Emergency Response Benefit (CERB), you need to know that amount is taxable. The CRA did not withhold taxes from the payment, so you will owe taxes on it. You’ll receive a T4A or T4E slip in the mail showing the total amount you collected from CERB in 2020. It will then need to be reported in your personal income tax forms.

If you switched over to one of the new recovery benefit programs after CERB ended (CRB, CRSB, or CRCB), you should know that all of these benefits are also taxable. Taxes were withheld at the source for these programs (10%), but they will still need to be reported in your taxes.

For all of these programs, repaid amounts are not included in your taxable income.

There are also many new benefits and tax credits for those working from home in 2020. If you want to take full advantage of these credits, we highly suggest connecting with us at The Number Works. We can ensure that you get every potential credit to make your tax bill as low as possible for the 2020 tax year.

Working with The Number Works

If you’re working with The Number Works to handle your 2020 taxes, there are a few steps you need to take.

If you are a current client, we ask you to fill out our Client Tax Questionnaire ASAP, including your full name and SIN. There’s new information included in the questionnaire related to COVID-19, so it’s essential that we have this information.

The deadline to upload the completed questionnaire is April 15th so we can meet the April 30th deadline. If the questionnaire is not completed before this date, we cannot guarantee that your taxes will be filed on time, as we’ll need to work on them in order of receipt.

If, on the other hand, you aren’t currently a client of The Number Works but want some help with your personal or small business taxes, we invite you to contact us today! We’ll get you set up so you can take advantage of every COVID-19 tax benefit or credit available to you. You don’t need to stress the tax season when you have The Number Works in your corner!

Why We Recommend QuickBooks

What program do you use to manage your small business’ finances?

There are dozens of effective options out there, but at The Number Works, we have a favourite: QuickBooks Online.

You’ve likely heard of QuickBooks, as it’s one of the most popular and well-known pieces of accounting software available today. Since its launch in 1983, QuickBooks has become the default financial tool for many small businesses, and for an excellent reason. They’ve been remarkably proactive at making sure that their app and products not only keep up with developments in the financial reporting sector but actually lead the way with new features too!

Flexible Pricing

Not every small business is the same. If you have different needs than larger organizations do, you shouldn’t be paying the same price for tax software features that you don’t need.

With QuickBooks, you can choose from three online accounting packages and find one that best suits your needs. If you simply need to track your income, expenses, taxes, invoices, and more, then the EasyStart package might be perfect for you. If your business is rapidly growing, you might benefit from some of the more advanced features, like inventory tracking and project profitability, offered in the Plus plan.

If you’re having trouble deciding which plan is right for you, The Number Works would be happy to help you figure it out!

Tax Season Approaches

While Canadians got a reprieve from handing their taxes in at the end of April 2020, there is—thus far—no indication that the same will be true in 2021. That means you should already be starting to pull together your tax information for the previous year.

Mind you, your taxes may be a bit more complicated this year when you consider the existence of CERB for individuals and pandemic-related tax benefits for businesses. In other words, if you found your taxes to be a headache in years past, be ready for a migraine in a few months!

Tax prep is one of the reasons why we highly recommend you use Quickbooks to manage your finances. Quickbooks Online will keep all of your finances in one place, including your income, expenses, receipts, invoices, and more. It also offers features to help you maximize your tax deductions, along with automatically handling HST. In other words, it’s going to be a big timesaver come tax season!

You Can Access QuickBooks Online From the Cloud

Remote work has become the norm over the last year, meaning that almost all work has become decentralized. As such, effective use of the cloud is more critical than ever for sharing documents between employees who could be working remotely.

With this in mind, Quickbooks being entirely online is an invaluable benefit for small businesses. You can access it from anywhere with an internet connection and on just about any device. Even better, QuickBooks Online offers 128-bit SSL encryption, along with multi-factor authentication. These security measures ensure that your financial data will remain in the cloud, where it belongs.

Another benefit is that you can connect your QuickBooks account with other online services, including PayPal, Shopify, and more, to help keep all of your finances tracked and in one place! It will also connect to most banks, automatically downloading your bank and credit card data daily.

Even though QuickBooks is designed to be user-friendly, that doesn’t mean it’s perfect. Many small business owners lose all hope when they first open it, overwhelmed by the sheer number of options and features offered to them.

At The Number Works, we’re dedicated to helping small business owners learn to manage their finances. As such, we would be delighted to help show you—or an employee—how to use QuickBooks effectively. If you lack a background in finances and feel in over your head, we can give you the foundation you need to take your business’ finances into your own hands!

We’d even be happy to set up your QuickBooks Online account in its entirety!

To learn more about our QuickBooks Online setup, along with our other financial services, please contact The Number Works today. Let’s get your business set up with QuickBooks so the upcoming tax season will be a breeze!

What the Pandemic Has Taught Us About Business

Is it safe to say that the last year has been a bit… challenging?

We’re not even referring to the pandemic itself. We mean all of the changes that our society has gone through BECAUSE of the pandemic.

Before the pandemic hit, the stock market was doing fine, employment was up, everything was going great. And then March came, and within just a few weeks, everyone was knocked off their feet, unsure how to move forward. Fortunately, everyone moved quickly to figure out how to adjust. Many businesses rapidly put technological innovations and new remote work procedures into place that allowed them to stay open, even during the lockdown. Remarkably enough, some of these changes were actually very positive steps forward!

While COVID-19 is still a problem, staying in business is now much easier than it was at the beginning of the year. Here are just a few of the things that the pandemic taught us about running a business in 2020.

Be Flexible

While we certainly don’t expect anything of the magnitude of COVID-19 to happen in 2021—at least, we hope not—the disruptions caused by the pandemic taught us a valuable lesson about flexibility.

If you came up with a business plan back in January 2020, chances are that you needed to throw it out the window by the end of April. “Business as usual” just wasn’t possible anymore. Almost instantly, we saw a divide between businesses trying to rigidly stick to their original plans versus those that rapidly adapted to the “new normal”, changing their plans to best position themselves for success.

Those that tried to stick with a brick-and-mortar-only business model suffered, while those that shifted their business almost entirely online thrived. These businesses translated their product offerings to the digital space, allowing them to stay open throughout the lockdown.

Data Access is Essential

Dependency on the Cloud also grew throughout the pandemic. Locally-stored files were no longer an option, as people simply weren’t in the office. Accessing one’s data from anywhere became a necessity, leading many businesses to start exploring Cloud-storage options.

If you haven’t moved to the Cloud yet, it might be time to make the leap! This will give your business an additional level of flexibility to allow your employees to work from home. Speaking of which…

Communication Tools Are Key

Did you even know what Zoom was ten months ago?

Thanks to the pandemic, keeping in contact with your employees and clients became a nightmare of logistics. Sure, regular phone calls helped, but many people depend on non-verbal communication to truly connect. Enter Zoom.

Zoom rapidly took the lead in video conferencing, almost instantly beating out many of its more established competitors like Skype and Facebook. Why? Ease of entry; anyone could get on a Zoom call. They didn’t need to create an account or worry about hosting. Zoom facilitated easy communication between people—though the technology wasn’t always perfect. There were some significant security and privacy concerns, especially early on in 2020. But those problems have since been patched, and now Zoom is back on top.

Our advice for 2021 would be to keep an eye on the video conferencing space to see how companies innovate. Zoom won’t be on top forever, so by staying aware of new developments you’ll be able to keep your business on the cutting edge of communication—because even once we’re back in the office, video conferencing won’t be going anywhere!

Every Dollar Counts

While programs like CERB helped individuals financially survive during the worst of the pandemic, many small businesses were scrambling. Suddenly, their bottom line was flat, and their expenses were ballooning. Something needed to be done.

One strategy was to ask a financial professional to look at their books to find places where they could trim some fat. Businesses needed to become leaner to make sure that every dollar counted. Throughout 2020, we have gone through the books of many of our clients, helping them find a few places they could tighten their belts. Even freeing up a few extra dollars every month can make a huge difference during a time of crisis!

Even though vaccines are on their way, it’s going to be a long time before things can get back to the way they were. It’s not too late for your business to pivot and make some changes that will not only help you thrive during the pandemic, but long after. One of these ways is to shift your finances over to professionals.

At The Number Works, we’ve been working throughout the pandemic to keep small businesses in a strong financial shape. From handling taxes to finding a few extra dollars in your budget, we strive to make a real difference in your bottom line. Contact us today, and we can help your business survive and thrive in 2021 using all of the lessons we learned in 2020!

What Will the 2021 Economy Hold in Store? No Matter What, Prepare Your Small Business!

Are you nervous about 2021?

You’re not alone. The last year has been a rollercoaster ride for small businesses across Canada, and many aren’t sure where to go from here. There could be a vaccine on the way that will help get everything back on track, or we could be facing new lockdowns. Who knows? Your small business needs to be prepared, no matter what 2021 has in store!

Here are some of the areas we’ve been focusing on with our clients to help prepare them for the upcoming year:

Revamp Your At-Home Workspace

Did you start working at home after the pandemic hit? If so, you’ve probably settled into a comfortable groove by now.

Working from home brings entirely new challenges to the fore. Sure, you have all of the technology you need to get your work done, but there are also new distractions. Kids, spouses, housework, and inadequate office space can get in the way of doing your daily tasks. The best way to combat this is to revamp your workspace!

This revamp doesn’t necessarily mean you have to change the physical area of your at-home office, though in some cases that might be required. Instead, you can do a little digital restructuring. For example, create a separate user account on your computer you solely use for work. You can even put some restrictions on this account to prevent easy-access to distractions like YouTube. Simply having a second work-based account can help to get you into the right headspace for productive at-home work.

Use Virtual Employees

The pandemic has rapidly advanced the rise of remote work tools. These tools, such as Zoom, have become mainstream and are poised to continue changing the work landscape over the next year.

To keep current, why not consider hiring some additional virtual help? At a fraction of the cost of in-person employees, virtual workers can complete many of the same tasks from provinces away.

Connecting virtually with our clients is something that we’ve been doing for years at The Number Works. By connecting with our clients remotely, we can do all of their books from our own workspace while still effectively communicating through Zoom and other productivity tools. As a virtual bookkeeping, accounting, and financial coaching firm, we know how important it is for our clients to have instant access to us. If you’ve been working virtually with us for years, why not explore similar relationships with virtual employees?

Keep Customers Front of Mind

Customers are the lifeblood of any small business.

Unfortunately, 2020 has not been kind to customer confidence. Many people are saving every cent, worried about what might come in 2021. The only way small businesses can combat this is by making sure they’re at the front and centre in their customers’ minds.

We highly recommend contacting your current customers or clients to see how the year has been treating them. Be sure to offer your help in any way that you can. If their needs have changed, can you alter your services to meet those needs? It might require you to offer them a temporary deal on your services, but that could be worth it to keep them on as customers!

Try New Methods of Marketing

Even if you’ve held onto your customer base, that doesn’t mean you shouldn’t be on the lookout for brand-new clients. To do this, you might need to stretch your marketing muscles.

Spending your marketing dollars online is a great way to get the best bang for your buck. Facebook ads, Twitter posts, Instagram Stories, and other social media tools are fantastic for connecting you with new customers or clients while also giving you a great return-on-investment. You could also consider creating a blog that will allow you to reach out to new customers with valuable content. There are so many potential customers online nowadays—don’t let your competitors get to them first!

Carefully Monitor Your Cash Flow

Truth be told, monitoring your cash flow is something you should be doing all the time, but it’s going to be especially vital in 2021.

We’ve been working closely with our clients in 2020 to lower their expenses and increase their profits. This can require you to dig deep into your books to find inefficiencies that could result in hundreds—or even thousands—of dollars of savings a year. Alternatively, you could let us do this for you since we know precisely what we’re looking for!

Don’t Forget About Your Taxes!

While tax deadlines were extended in 2020, don’t expect the same thing to happen in 2021.

That means you need your taxes to be finished ASAP. Don’t let the feeling of having just done your taxes a couple of months ago affect you. Instead, either crack open the books yourself or hire us to do it for you. We can help you find the deductions that will keep your business humming along during one of the most challenging times of the last thirty years.

If you’re looking for a professional accountant to help keep you on track in 2020, contact us today. At The Number Works, we’ll do whatever we can to keep your finances healthy and your books balanced going into the new year and beyond!

Finish Strong: Small Business Tips to End the Year Strong, Despite the Pandemic

Are you looking forward to the end of 2020?

Due to the pandemic, the last year was filled with challenges. Yes, there were some bright spots in the year, but for the most part, we don’t think anyone is going to be missing 2020!

That said, the year isn’t over yet. There are still a few months to go until we ring in 2021, and as a small business owner, you need to make the most of them. Sure this year has been tough so far, but there’s absolutely no reason why you can’t finish it strong!

Start Getting Your Books in Order

The government delayed tax assessments this year due to COVID-19, but chances are they won’t be doing that in 2021. Unless you want to get hit with a wave of stress at the beginning of the new year, it can pay to start your tax preparation right now.

We aren’t suggesting entirely finishing off your taxes, of course. There’s still lots of financial information that’s yet to come. But organizing receipts, invoices, write-offs, and other vital documents by date will ensure that everything is precisely where you need it when tax time comes.

If you want to avoid that stress altogether, you could send those well-organized financial documents to us, and we’ll handle your taxes for you! Things will likely be very tricky this year due to CERB and other federal and provincial financial assistance programs. There will be write-offs and credits that you might not know about yet, and the only way you can be sure you’ll get them is by hiring the pros to handle your taxes for you!

Reach Out to Your Clients

There has been a real lack of human connection this year, for obvious reasons. While social bubbling during the summer helped, we’re all still feeling the need for genuine connection with other people.

The holiday season could be the perfect time for you to reach out to your clients. We aren’t just talking about holiday cards here, but actual calls on the phone or personalized emails. Reaching out to see how everyone is doing could pay real dividends, especially around the holidays. The calls and emails don’t need to be super lengthy, but you should personalize them and aim to express genuine sentiments. A little authenticity can go a long way!

Get Your Holiday Sales Ready

No one knows what’s going to happen with holiday sales this year. Obviously, in-store purchases are going to be down, while online sales will be way up. This could mean that you need to take some extra steps to ensure that your clients’ holiday shopping experience with you goes as smoothly as possible.

The increase in online sales will likely lead to an overload in package deliveries, leading to possible backups and delivery delays. You should encourage your customers to order your products or services as soon as possible to avoid the holiday shipping rush. For those customers who might end up ordering a bit too late, you could consider including a “Pick Up at Store” option on your online store.

You also need to make sure that you’re fully stocked for the holidays. It could be difficult to predict how much stock you’ll need, as demand is likely to be very different than it was in previous years. We’ve written more about this here if you’d like to learn more.

Prep for 2021

While we all hope the pandemic will be over early in 2021, there is no guarantee that will happen. With that in mind, we recommend that you hope for the best, plan for the worst. Who knows what could happen? Another lockdown? An economic recession? You must prepare for all eventualities.

To prep for 2021, the first thing we would suggest is to boost your online presence. An ever-increasing amount of business is online-based, so you need to put your best foot forward online. Revamp all of your social media accounts, redesign your website, and do some reputation management by monitoring your online reviews. Start to think of your online presence as your main “storefront” and treat it with the same level of care as you would your brick-and-mortar location.

You should also be putting together as big an emergency fund as possible right now. This is an area where we can help. We can go through your books to find areas where you can cut back and streamline your business’ expenses. This could free up some funds that might become critical if things get bad again next year.

2020 is on the way out, and 2021 is looming on the horizon. By hitting the gas now, you could get a big boost of business heading into January. If there’s anywhere in your business you think The Number Works could help, please feel free to contact us today. As a small business ourselves, we personally know how stressful 2020 has been and will do whatever we can to help you come out on the other side as financially strong as possible!

Budget & Inventory Planning for the Holidays

Are you ready for the holiday rush? Even though it’s only October, you might want to start preparing for it soon!

If you own a small business, your sales are likely down from this same time in 2019. COVID-19 shutdowns affected every industry—even businesses that are primarily digital felt the impact. This is one reason why countless businesses have been pivoting online, minimizing their physical footprint while also taking advantage of the potential boost in online sales.

This trend is likely to continue into the holiday season. Rather than deal with crowded stores and malls during November and December, consumers will likely be doing most of their shopping online. You need to have your budget and inventory planning prepared for the holidays well ahead of time to make sure you aren’t slammed by the rush.

Here are a few ideas to ensure that your business’ holiday season is full of cheer and high sales numbers!

Start Working on a Budget

Along with big holiday sales comes big holiday business expenses.

Usually, businesses rely on their previous year’s holiday budget to help guide their budget planning process. However, as things are VERY different this year, piggybacking entirely on 2019’s numbers isn’t a viable plan.

Consider that online sales are likely going to make up the bulk of purchases this holiday season. With that in mind, you need to make sure your e-commerce platform of choice can handle those additional sales without crashing. The last thing you want is your online store to crash on Black Friday! If you believe that you’re going to need extra bandwidth, take care of that right now while everyone else is still focused on Halloween.

If you still have a physical location open, then you might need to hire some extra help for the season. Keep in mind that you will need to train them in all of your COVID-19-related policies, along with your regular employee training programs.

If you’re already overwhelmed just thinking about holiday planning, you could always outsource your holiday budget planning to us. We’d be happy to go through everything and help you generate an airtight budget that will keep things comfortably humming along this holiday season!

Holiday Marketing

There’s lots of competition for shoppers during the holiday season, so you should have a well-designed digital (or physical) marketing blitz planned. If you do any holiday-related marketing, make sure that you have those expenses already budgeted.

Your holiday marketing could be entirely focused on the online space, using digital channels like Facebook, Google, and email campaigns to connect with your customers and share your holiday offerings. If you live in a smaller market, you might also want to take advantage of more traditional offerings like radio ads or even newspapers.

Be sure to look at your previous ROI on holiday marketing to find out where you can best spend your marketing dollars. This year especially, you want to make sure you’re making every cent count!

Make Sure You Have Enough Inventory

While the shipping industry has somewhat recovered from the logistics disaster of COVID-19, shipped items can still take a while to get from point A to point B. If you’re relying on shipping services to order inventory and upping your stock, you should be ordering what you need ASAP to make sure you’re not going to be in short-stocked come November.

Go through your current inventory list and then update your holiday list. It might be tricky to gauge how the pandemic will impact seasonal sales, but you can likely rely on your previous year’s numbers as a baseline, then adjust them from there as best you can.

Inventory Management is Key

So, your budget is in order, and your inventory has arrived! Now it’s time to get everything organized for the holidays.

If you have a single channel to sell your items (like an e-commerce solution on your website), this task shouldn’t be too difficult. You simply need to make sure that you have an accurate count of your inventory across the board. If you rely on multiple channels to sell your items, like eBay, Amazon, and Etsy, then this might take you a little longer, as you’ll need to maintain listings and monitor these platforms for messages and questions. Don’t forget to include any fees for sales that are taken by these platforms!

The holidays can be a stressful time for anyone, and especially for small business owners. If you want to relieve some of that pressure, The Number Worlds would be happy to help you with all of your holiday-related budgeting. Not only that, but by taking advantage of our services now, it will be much easier to take care of things during the upcoming 2021 tax season. To learn more, please contact The Number Works today. Let’s get your holiday season under control now so you can enjoy the end of the year!

Back to School & Back to Business 2020

Under normal circumstances at this time of year, kids start feeling that “back-to-school” anxiety. This year has a whole different kind of stress attached to it. And even if you’re not a parent, these feelings also apply to your business.

We may be in Stage 3 of reopening, but many small business owners are still unsure how to move forward. We find that the best way to work through anxiety is to assess and plan based on real information. Here are a few ideas on how you can get a handle on things, and prepare for everything Fall of 2020 has in store.

It Starts with Your Books

Facing your books is the beginning of planning and moving forward in this pandemic world. Don’t have a panic attack. The best thing you can do is understand your numbers, assess the health of your business, and make informed decisions.

If your business was closed throughout the first stages of the pandemic, the state of your books will reflect that—it’s not fun, but this is data you need to face.

To figure out how to pull yourself out of the hole that the pandemic has may have put you in, you need to know everything about your current financial situation. We can help you analyze the information. With our experience with small businesses, we can often find places where they can cut costs and correct deficiencies to save you money. And every cent matters in this market.

Oh, and if you’re worried about your personal finances, we can help with that too.

Invest in Online

It’s crazy to think that only six months ago, few people had ever heard of Zoom. Now, it seems to be the video conferencing app of choice for countless businesses around the world.

Even though things like schools and businesses are reopening, there will still be an increased emphasis on the digital side for the foreseeable future—or maybe even forever! With this in mind, it’s important to invest in your digital assets.

For example, if you haven’t updated your website in years, you should get on that immediately. Your website is your digital storefront, and given that many people will still be remaining inside, it’s the only storefront they will see! Also, take a look at reinvigorating your social media accounts to engage directly with your clients and customers. What about sprucing up or starting a new email marketing campaign? Since face-to-face contact is out, finding new ways to keep in touch with your customers can help. And with digital advertising, you can gain visibility with new customers at a fraction of the cost of traditional marketing.

If you sell products, a great online shop could completely transform your business. These days there are so many options to choose from; Shopify, Woocommerce on WordPress, and Squarespace are just a few options. A great online shop combined with some savvy social media marketing could push your business ahead this fall, just in time for the holiday season.

If you run a restaurant or a service-based business, make sure your menus and offerings are clear and appealing. A good copywriter can help you entice potential customers while also optimizing your keywords for Google. And now might be the right opportunity to consider an app for your business.

Now is also a good time to invest in some upgraded technology for both you and your children. For example, most laptops’ webcams are terrible, resulting in a horrible image for digital conferences and remote learning. Similarly, the built-in microphones usually aren’t great either. By investing in a decent quality webcam and microphone/headset, you can vastly improve your digital networking capabilities. In this environment, it’s an investment worth making.

Create a Revamped Business Plan

If you wrote a business plan before March 2020, you’ve likely thrown it out the window by now!

Even though the world has changed, it’s still essential to have a business and financial plan in place to chart your path for future growth, with your goals, hopes, dreams, challenges, and solutions assessed and prepared. We’ve been helping many small businesses with the financial side of their new business plan, giving them some direction moving forward into the fall.

We Can Help

If you’re experiencing some anxiety about your business right now, that’s entirely natural. After all, things are still changing and we don’t know where this pandemic will end. But by starting to make some plans for your business, you can take back some control and get a better grasp on things. This will certainly help reduce that anxiety!

If you need help understanding your numbers and your business’s financial health, contact The Number Works today. We can help you take control of your finances and create a financial plan for the months to come!

Money Saving Tips for Small Businesses

Money Saving Tips for Small Businesses

Have you been tightening your belt lately at your small business?

It seems like everyone is looking for places to save some money right now. And that makes sense, as most small businesses have been closed for the last few months. Even though we’re well into reopening across the province, it’s still going to take some time for everything to get back to normal. For businesses to rebound quickly, they’re going to need every spare penny they can find!

If you’ve been going through your small business’ budget looking for places to trim some fat, here are some ideas on how you might save some money throughout the rest of the year:

Change Up Your Advertising

When it comes to advertising, new small businesses sometimes think they need to break the bank to get people to notice them. That could be a big mistake, especially if they’re already working from a limited budget.

Rather than spending as much money on marketing as possible, it would be a better strategy to make the biggest impact for as little money as possible. ROI is crucial when it comes to marketing, so don’t splurge for that full-page newspaper ad right off the bat!

Do you have a professional-looking website? You should! If you’re just starting out, avoid going with a custom design and stick with a service like SquareSpace or WordPress. These are “do-it-yourself” website building and hosting companies that can deliver incredible-looking and easy-to-manage sites.

Once you have your website up, start building your social media presence online. It’s free to create profiles on Facebook, Twitter, and Instagram for your business. From there, you can start to create social media ads. They cost a fraction of what traditional advertising methods cost, but can deliver big returns!

Optimize Your Time

Some people think “time is money” is just an old cliche. Small business owners know better.

The more time you spend on small but time-consuming tasks, the less you’re going to have to spend on the big important stuff that actually makes you money. If you have a staff, you want to be paying them for hard work, not busy work and wasted time. To do this, you need to optimize how you’re spending your hours at work.

To do this, we recommend using a project management system such as Asana or Teamwork. Disorganization is usually the reason why time gets wasted, so fix this by using a tool that keeps your projects and tasks in one place! You’ll be amazed at how much more productive you and your staff become when everyone is clear on what they need to do.

Use Alternative or Open-Source Software

One of the biggest drags on the income of small businesses is the computer software they use. For example, if you work on PCs, then you likely have Microsoft Office installed. If you go with the standalone version of the software that you can only install on a single computer, you’re going to be paying $250. If you go with the subscription model, you’re going to be paying $100 a year. Either way, that’s a lot of money!

There are much cheaper alternatives out there for such software that offer almost identical functionality. For example, Google Suite is not only free, but it includes a great word processor, calendar, spreadsheets, and just about everything else you could get from Microsoft Office. Or, if you want a more Office-like experience, why not try LibreOffice? It’s a free, open-source productivity suite that is very similar to Office in terms of functionality and interface.

Another expensive piece of software that almost every small business uses is Adobe. Adobe programs like Acrobat and Photoshop can be essentials for any workplace, but they can also be incredibly expensive. Subscribing to a single app can run you up to $30 a month. If you want to use all of them, that’s going to be closer to $80 a month. But there are alternatives!

If you want to spend less money on editing PDFs, you could try Nitro Pro. It offers similar functionality to Adobe Acrobat, but for a one-time purchase of $160. If you want a free graphics editor, your best bet would be GIMP (short for GNU Image Manipulation Program). Its interface might take a little getting used to, but its feature set is fantastic!

Have an Accountant Take Care of Your Books

Early on in their business, some small business owners think a great way to save money is to do their taxes themselves. Unfortunately, they often learn the hard way that this is not only a bad idea, but it could cost them money in the long run.

First, doing your own business’ taxes is super time-consuming. If you’ve never done them before, you’re likely unaware of credits and deductions that could significantly reduce your tax bill. Add to that the several hours that it takes to complete and send your taxes off to the CRA, and it often becomes a time investment you can’t afford.

When you work with a professional accountant/bookkeeper, all of that is taken care of for you. We have worked with dozens upon dozens of small businesses over the years, helping them reduce their tax burden and saving them money and headaches. Not only that, but we also help them find places in their budgets where they could cut back and save even more. We realize we’re slightly biased, but hiring a great accountant is a terrific investment in your business’ future!

If you want to learn more about how we can help you manage your business’ finances, we invite you to contact The Number Works today. With our years of accounting experience, we’ll work to save you money and help your business thrive throughout the rest of 2020!

Economic Slump? Tips to Recession-Proof Your Business

Economic Slump? Tips to Recession-Proof Your Business

Does the recent recession have you worrying about your small business?

COVID-19 has had an unparalleled impact on economies around the world. The damage to the stock market and the shelter-in-place orders that kept small businesses closed for months has resulted in fears that the Canadian economy was slipping into a recession (or even a depression). The Federal government has put programs into place to support both businesses and individuals, but for many, that isn’t enough. A recession can last months to years, so your business needs to be ready for the long haul.

If you’re worried about decreasing sales and consumer confidence, there are some steps you can take to make your business recession-proof. Here are some suggestions!

Watch Your Cash Flow

During a recession, protecting your cash flow becomes the most critical part of keeping in business.

In an ideal situation, you’re bringing in more money than your expenses and turning a profit. If your sales and clients are down because of a recession, making a profit can seem like an almost impossible task. To find some extra money, you’re going to need to hit the books.

Every small business, no matter how well-run, always has some inefficiencies. These can cost your business anywhere from hundreds to thousands of dollars every year. The trick is to figure out where these inefficiencies are.

A professional bookkeeper can help you sniff out these inefficiencies and suggest some places where you can save money. For example, you could be spending far more than you need to for internet or phone services. Switching to cheaper plans could save you hundreds of dollars a year.

Reduce Inventory Costs

During a recession, your sales could be down, which means you might have surplus inventory just sitting in a warehouse, taking up space and costing you money.

Your inventory costs are a place where you can potentially find big savings. For example, you could consider switching from a warehouse to a drop-shipping alternative for your products. You could also shop around, as many businesses have dropped the price of their services due to the impact of COVID-19. You might be able to negotiate a better deal with your current warehouse provider. You never know until you ask!

Support Your Current Customers

A recession goes hand-in-hand with a reduction in customer confidence. Even if their personal cash flow hasn’t taken a hit, people are less likely to spend money during a time when the economy is in trouble. To keep in business, you’re going to need to shore up your relationships with your current customers.

It’s a great time to contact your loyal customers to see how they are doing and if there’s anything you can do to help. Their needs may have changed because of the recession, so you should do your best to meet those needs if you’re able. If this means giving your customers a temporary deal on your services, it could be worth it. After all, keeping loyal customers now will mean that they’ll stay on when times improve.

Win New Customers

Expanding your customer base during the good times is important, but expanding it during the bad times is absolutely vital! It might be time to offer some sales or discounts on your products or services. Do some research on the kinds of marketing your competitors are currently doing to avoid being undercut. And speaking of marketing…

Keep Marketing Yourself

When you look at your current cash flow, you might think an easy place to trim some fat would be in your marketing budget. However, this decision could significantly damage your ability to connect with new customers.

A better plan is to get smarter with your marketing dollars. For example, if you’re running print ads with little return-on-investment, it might be time to switch to digital marketing avenues like social media. This shift in strategy is especially important when more and more people are spending time online.

No business can become entirely recession-proof as there are too many variables at play. But what you can do is put some measures into place to help you survive a recession and come out the other side in much better shape than others in your industry!

To help you monitor and manage your finances, we invite you to contact The Number Works today. With our years of accounting experience, we can help your small business navigate this recession and whatever is yet to come!

New 2020 Tax Deadlines Are Approaching

Reminder: New 2020 Tax Deadlines Are Approaching!

Are you aware of the changes the CRA has made to your tax return deadlines?

COVID-19 has brought about so many changes in our lives. Zoom meetings, physical distancing, homeschooling, stay-at-home orders… it’s been overwhelming for us all. And then, as the cherry on top, we started to get notice of assessments in the mail saying that our taxes were due on April 30th, 2020. Yikes!

Thankfully, the government saw fit to give us all a break in April and moved most income tax deadlines a month into the future. This decision has given Canadians some much-needed breathing room. After all, doing your taxes is stressful enough already, let alone doing them during a global pandemic!

So, here are the dates that you need to know to make sure you get everything submitted to the CRA with time to spare:

Filing Date for Individuals

The deadline for filing your personal income taxes this year was moved a month later, to June 1st, 2020. You’ve likely already done most of your tax prep back in March or April (and if you haven’t, we could probably help with that). So all you need to do is fill out the forms and file online or through the mail.

Another way that CRA is helping Canadians is by delaying the payment dates of your income tax to on or before September 1st, 2020. You don’t need to send any money until that date, with no threats of interest or penalties. This deferral could free up some additional room in your budget over the next few months.

Filing Date for Corporations

Similar to individual income taxes, the deadline for filing corporate tax returns is now on or before June 1st, 2020 for those originally due after March 18 and before June 1. Corporations with a filing deadline in June, July or August is extended to September 1st, 2020. This delay was a big stress reliever for business owners, as many of their businesses had been closed due to physical distancing guidelines throughout March and April. But sadly, the “bill” has come due – if you’re a business owner, you’ll need to get your taxes in by the end of the month!

The payment date for corporate taxes has also been moved to September 1st, 2020. Again, this deferral should free up some much-needed budgetary space for businesses of all sizes during this difficult time.

Filing Date for the Self-Employed

Here’s where things get a little tricky. While the CRA moved tax deadlines for individuals and corporations, the deadline for the self-employed remains on or before June 15th, 2020. We understand that it would be nice to get a bit more time to finish your taxes, but that’s still two more weeks than the other groups!

Much like with individual and corporate taxes, the payment date for your taxes has been moved to September 1st, 2020.

Reasons to File Your Taxes ASAP

Just because you have some extra time to do your taxes doesn’t mean you should wait until the last minute. If you ignore them until a week before the deadline, you’re going to be pretty stressed out. By doing your taxes now, you’ll be taking a huge burden off your shoulders, helping you better manage your current situation.

You should also keep in mind that waiting to file your tax returns could result in a delay of any of your benefits under the GST/HST tax credit or the Canada Child Care Benefit, along with potential refunds.

Take the Pressure Off Entirely!

Way back in March, we had dozens of our clients send us all of their relevant financial documents so we could do their taxes. They told us that knowing they didn’t have to do anything was a massive weight off their mind.

Today, individuals and businesses are back in the same situation, except now it’s even more stressful. People usually dread doing their taxes at the best of times, and this is NOT the best of times!

Fortunately, we can help. Even though our physical location is closed due to COVID-19, we’re still putting our nose to the grind doing bookkeeping and taxes for our clients! If you haven’t filed your taxes yet, you could easily send us all of your receipts, invoices, pay stubs, and other financial documents. We’ll take care of the rest! The best part is that you’ll know that a tax professional is making sure that you get every credit and deduction that’s available to you and your business.

So, if you want to take the pressure off doing your taxes, contact The Number Works today. We’ll take care of your taxes so you can take care of yourself!