Tips for Managing Small Business Finance
Stay updated with current accounting standards, business compliance, tax preparation tips, and latest news.
21 Dec 2022
Tips for Managing Small Business FinanceAs a small business owner, there is always something important that necessitates the utmost attention, time, and effort. Managing finances is one of them and perhaps the first one to be procrastinated for another day. Despite understanding the importance of maintaining accurate financial records, a small business owner may not have the time or knowledge to correctly track & handle company finances. This is where financial mismanagement begins and quickly becomes overwhelming. Study shows that most businesses fail in their initial stage due to a lack of structured financial management. From administering cash flow to planning funds, everything is crucial for a business to run smoothly. Whether you are in a starting phase or considering expansion, you need to manage your firm’s income and expense flow efficiently. Smart, small business accounting practices are essential for managing your daily operations and planning for long-term growth while avoiding costly errors that attract penalties. The following tips will help you to organize and manage your finances. Register your business The first step towards managing finances is to register a business. Start by choosing a suitable structure that determines ownership, business liability, and tax implications. These are the most common business structures in Canada -
- Sole proprietorship
- Chequing Account - It is a transactional account designed for daily transactions, paying bills, and making payments and purchases. With this account, a person can withdraw and deposit money anytime without paying any interest, as it is used to conduct daily transactions and is meant for pertinent use.
- Savings Account - This account is ideal for keeping funds for short and long-term business goals since the account earns interest. When required, transfer the funds to the chequing account for use as a direct withdrawal from the savings account attracts withdrawal charges.
- Personal Tax
- Corporate Tax