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It is very important that entrepreneurs learn how to file T4 and T fives properly says Edmonton bookkeeping. If they do not, they could end up triggering penalties for themselves. It can be very easy to help entrepreneurs gain the skills that can help them file this information correctly. However, fund owners do not learn how to do this early on in their business, they could end up triggering penalties that are very difficult for them to pay. Since 50% of all entrepreneurs fail in business before five years of business ownership, and 29% of those failed entrepreneurs say the reason why they fail is because they ran out of money. Anyhow to avoid incurring penalties can go a long way in helping entrepreneurs avoid running out of money in their business.

One of the first things that entrepreneurs should learn when it comes to filing T4 and T5 slips properly is what the information being reported on them is. Ten bookkeeping says that and T5 slip is where all of the dividends that are dispersed are recorded. This is all of the money that a shareholder has taken out of the corporation, taken from the earnings. If the corporation has not turned profit yet, or if the shareholders have not collected dividends, this will result in no T fives needing to be generated.

T fours on the other hand are all of the payroll deductions are recorded for all salaried employees including the business owner. This means an entrepreneur must ensure that they are taking the correct source deductions off of their employees checks and remitting it accurately to Canada revenue agency. CPP and EI be taken off of the employees checks as well as income taxes. If an entrepreneur collects a salary themselves, they must withhold that amount from them selves as well. In addition to that, an entrepreneur must ensure that they are paying the employer portion of CPP and EI as part of their source sections the remit to Canada revenue agency.

It is very important that entrepreneurs not only understand what these are recording, but when they need to be filed by says Edmonton bookkeeping. Even though the detailed two very different types of information, they need to be filed by the same deadline, which is the end of February. Edmonton bookkeeping says that if entrepreneurs do not filed by this deadline, can end up triggering penalties. The penalties are a dollar amount for every employee that an entrepreneur has, and for every day that an entrepreneur has missed filing. The more employees business owner has, or the more days that they have not filed, increases the amount of money that an entrepreneur must paying penalties.

Business owners should be aware of what a T4 and T5 slip are recording, and then also know when they are due to be filed. Since employees need these slips in order to claim personal taxes, business owner should ensure that they are meeting that deadline not just to avoid a penalty from Canada revenue agency, so that their staff have the tools they need to get their taxes done.

Edmonton Bookkeeping | Why Entrepreneurs Need To Learn To File T4 And T Fives Properly

A T4 slip is recording all of the payroll deductions that an entrepreneur should have withheld from their staff and submitted to Canada revenue agency says Edmonton bookkeeping. Therefore, prior to completing filing the T4 and T5 slips, business owners should be checking to ensure that they have permitted the correct amount, and what to do if they have not. This is an important way that business owners can ensure that if they have made a mistake on remitting payroll deductions, they can fix it before incurring penalties or triggering a payroll audit for their business.

Many people wonder how Canada revenue agency knows if an entrepreneur has not paid enough source deductions. However, Edmonton bookkeeping says that when entrepreneurs file their T4 slips on the last day of February, Canada revenue agency will be able to see how much source deductions they should have permitted, and compare that to the source deductions that an entrepreneur has sent in. If there is a discrepancy, that could very easily trigger a payroll audit as well as penalties.

Therefore, it is very important that entrepreneurs keep this in mind when they are preparing their T4 and T5 slips to be filed. By checking out the source deductions amount that they should have remitted against what they have already sent CRA, they will be able to see if they owe any additional amounts. If they do, Edmonton bookkeeping says that they have until January 15 every year to pay anything that was left outstanding. Then, when they do end up filing their T fours at the end of February, they will avoid incurring a penalty even if they have not been spending the correct amount.

Business owners should keep in mind that if they are underpaying source deductions, they are not going to hear about it from Canada revenue agency until they file their T4 slip. Therefore, as long as they are paying by the fifteenth of every month or sooner, they might not have any idea that anything is wrong. Which is why it is very important that they are remitting any outstanding source deductions prior to filing their T4 and T5 slips says Edmonton bookkeeping.

If they have been to trigger an audit, they should expect for the auditor to request copies of all of the pay stubs, bank statements and what is called APD seven a report, which shows what source deductions should have been paid. what the auditor will be looking for, is to figure out where the source deductions that should have been remitted went. Canada revenue agency looks sternly upon source deductions that were not paid properly, as they see source deductions as money held in trust, and if an entrepreneur does not pay them properly, they view it as misuse of government funds.

Entrepreneurs can learn how to avoid triggering payroll audits in their business, as well as avoiding incurring penalties simply by ensuring that they are paying the correct amount of source deductions, and avoiding paying late. By doing this, entrepreneurs can ensure that they never have to put their business at risk by having to pay penalties. All of these things are important tools to help entrepreneur grow their business.