Business owners have to pay significant amounts of taxes in their business says Edmonton bookkeeping. Ensuring that they are managing each tax that they are collecting, and filing for accurately is very important. Sales tax is one of the most complex taxes out of all of them and requires a lot of additional planning to ensure that a business owner is not only collecting and remitting it accurately but ensuring that there filing it correctly as well. If an entrepreneur does not come up with a plan ahead of time and executed well, they may find out at the end of the year they did it incorrectly, and now have to pay additional money in interest charges and penalties.
One of the first things that are very important for entrepreneurs to understand when they are managing their sales tax, is that the filing deadline is three months after their corporate year-end. This is three months before an entrepreneurís corporate year end filing is due. The reason why this is important to note according to Edmonton bookkeeping, is if an entrepreneur prepares their sales tax return and sends it to Canada revenue agency before their corporate year-end is finished, it may have errors or mistakes in it. These errors or mistakes could at the very least because an entrepreneur to oh additional interest charges, but at the worst, end up with the business owner being hit with significant penalties from Canada revenue agency.
Therefore, a business owner needs to be aware of this difference in filing dates, so that they can make the decision between filing on time, and risking penalties. Or, filing three months late and getting interest charges. Edmonton bookkeeping says that while looking at both issues, it almost always is in a business ownerís best interest to file late, and pay the interest charges then half penalties.
If an entrepreneur has decided to file late, and pay interest on all of the amount that they owe the government for the three months that they are late, if the entrepreneur is aware of this, they can make a plan to remit payment intermittently throughout the year. Edmonton bookkeeping says that doing this can help entrepreneurs ensure that they are paying sales tax throughout the year so that when they file three months late at the end of the year, you will they will owe much less in sales tax, and get a lower interest charge.
Many business owners do not make payments in installments throughout the year, because they are unaware that they can make payments without actually filing sales tax when they make those payments says Edmonton bookkeeping. However, business owners need to be aware that they should make the decision at the beginning of their fiscal year if they are going to file their sales tax on time, or three months late, and if they are going to remit payments intermittently throughout the year, to minimize interest. By being aware of these issues ahead of time, can help an entrepreneur ensure that there managing it correctly throughout the year so that they eliminate errors, and reduce their interest charges.
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The complexities associated with filing sales tax need to be thought of ahead of time says Edmonton bookkeeping, so that entrepreneurs can be prepared throughout the year on what they must do to ensure there managing it efficiently and accurately. This can help ensure that when they get to the end of the year, that they are filing it properly so that they can avoid getting hit with penalties, and minimize the interest that they will have to pay.
If entrepreneurs believe that they do not need to plan this out ahead of time, because they are very comfortable with using their accounting software, and the accounting software has built in tools to help with sales tax. However, Edmonton bookkeeping says that entrepreneurs also need to be aware that because sales tax is so complex, the software is not able to handle all of the issues associated with managing sales tax. If an entrepreneur is counting solely on their accounting software to help them, they will end up with errors. If they are using their software, they should be aware of all of the deficiencies the software has when it comes to managing sales tax.
Another thing that business owners should keep in mind, is that if they are not keeping their financial statements up-to-date regularly, it will affect their GST filing. If the books are not kept current, an entrepreneur will not know how much GST they need to remit either in installments or at the end of the year when their GST return is due three months before their corporate year-end. However, if an entrepreneur is able to manage to keep their financial statements update or hire and Edmonton bookkeeping company like always bookkeeping to manage their monthly finances, they will have a greater chance of having accurate sales tax information throughout the year, so they can remit the correct amount, and have most accurate information as possible when they go to file it.
If they are getting help managing their finances, they can even hire their Edmonton bookkeeping company to file GST on their behalf. Bookkeepers have what is called a rapid identification number that will allow them with the consent form to represent business owners to Canada revenue agency for tax purposes and to file sales tax. Therefore, entrepreneurs might find it a better solution instead of trying to understand their accounting software, knowing that it is flawed, or simply hiring the right professionals to help them keep the right information throughout the year, and then file it accurately. By doing this, entrepreneurs can increase their chances of doing it properly, which will allow them to decrease their chances of having penalties. In order to do this, however, an entrepreneur must be planning their fiscal year ahead of time, and coming up with this plan to follow, if they think of it at the end of the year, it will not allow them to avoid any mistakes.