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If entrepreneurs believe that managing and filing their sales-tax will be just as easy as managing income tax, CPP, EI or fuel tax, Edmonton bookkeeping says that they may be setting themselves up for failure. Not only is sales-tax much more complex than any of those other taxes, but managing and filing it also has a bunch of difficulties built into it that makes it more difficult to file than other taxes. If entrepreneurs are not aware of this, they may open their business believing that it is going to be easy, and then find out at the end of the year that they have been assessed a bunch of penalties that are now causing them to run out of money to pay. This is avoidable by being aware of these issues ahead of time, and onto manures coming up with a plan.

One of the first things that entrepreneurs need to know that creates problems when filing their GST is that the deadline to file GST is earlier than the deadline to file their corporate tax return. The reason why this creates problems is that all of the information that an entrepreneur needs to put into their GST return comes from their corporate tax return. Therefore, in order for an entrepreneur to file their GST return on time, they have to guess at all of the information That needs to be put into it.

However, an entrepreneur can make very reasonable guesses about what information goes in there if they have updated and accurate financial statements. By getting in Edmonton bookkeeping company to manage that on their behalf can increase their chances of having accurate information, however, nothing is a guarantee. Therefore, an entrepreneur is making the decision to potentially end up with penalties simply by filing their GST on time.

However, an entrepreneur can decide to file their GST at the same time as their corporate tax return. Even though this means it is going to be three months late, there are no penalties associated with filing late. The only thing that they will be assessed is additional interest on all of the amounts that they owe the government at the time of the filing. The amount of money this will cost depend on how much money they owe the government. And if they have been making installments through the year, the interest charges will be minimal.

Therefore, an entrepreneur can make the decision to file their GST return late in order to ensure its accuracy. Then, they can make regular payments of sales-tax, so that at the end of the year they can owe the government as little GST is possible, which will help ensure they have to pay as little interest as possible as well.

By being aware of these complex issues associated with their sales-tax, can help entrepreneurs ensure that they have a plan in place that will allow them to focus the rest of the year on all of the strategic priorities and tasks they need to help them grow a big and successful business.

Edmonton Bookkeeping | Understanding The Complex Nature Of GST

It is extremely important that entrepreneurs keep in mind all of the different roles associated with filing their sales-tax says Edmonton bookkeeping. The reason why this is important, is because of it such a complex tax, that if entrepreneurs make mistakes, it could end up with them paying significant penalties. Since 50% of all entrepreneurs fail within five years, and 29% of those failed entrepreneurs say that they failed because they ran out of money. Avoiding paying penalties associated with incorrect GST returns can help entrepreneurs succeed and remain cash flow positive in their business.

One of the first things that entrepreneurs need to keep in mind, is that they owe GST regardless of if they have a corporation or proprietorship, as long as they are making over thirty thousand dollars in a year. Typically, Edmonton bookkeeping says that entrepreneurs will start out as a proprietorship, and grow from there. If they are still operating as a proprietorship when they hit thirty thousand dollars in a year, they need to get a GST number and collect and remit sales tax. As a proprietor, their filing deadline is the same as their personal deadline which is 15 June every year.

Once an entrepreneur has grown their proprietorship, and they decide to incorporate which Edmonton bookkeeping recommends happens when they get to about fifty thousand dollars of sales in the year, an entrepreneur can incorporate, but then they need to get a different GST number. Not only do they have to get another GST number says Edmonton bookkeeping, but there GST filing deadline will then change as well. They will have to submit their return three months after they choose when their corporate year-end will be.

One of the most important things that an entrepreneur needs to keep in mind about changing GST numbers, is that when they get a new number, they must close down the number that they had previously. If they do not, Edmonton bookkeeping says an entrepreneur will be put at risk for the CRA self-assessing them, by thinking that they are still operating that business but just have not filed their tax return. By getting a self-assessment from Canada revenue agency, that means entrepreneurs will be hit with a huge tax bill, similar to what their tax bill was last year incorrectly. To avoid this, entrepreneurs can simply close their GST number, and avoid getting a tax bill.

By understanding how complex sales-tax is, and how the rules change from one type of entity to the other. This can help entrepreneurs can be organized ahead of time, and come up with a plan on how they are going to manage their sales-tax throughout the year so that during the year, an entrepreneur does not have to worry about it. They can spend their time and energy instead by focusing on all the strategic priorities they need to accomplish in order to grow their business.