5 Bookkeeping Habits That Save Small Businesses Money at Tax Time

Reconcile your bank and credit card accounts every month instead of waiting until year-end. Monthly reconciliation catches errors and missing receipts while the transactions are still fresh, which means fewer surprises when your return is prepared.

Keep business and personal spending in separate accounts. Mixing the two makes it harder to substantiate expenses to the CRA and usually adds hours of cleanup work before a return can be filed.

Track mileage and home office use as you go. Both are common deductions that get underclaimed simply because the supporting log wasn't kept during the year.

Set aside GST/HST and income tax instalments in a separate savings account as you invoice clients. This avoids a cash-flow crunch when a remittance or instalment payment comes due.

Review your bookkeeping quarterly with your accountant, not just annually. A quick check-in lets you catch categorization issues and plan for tax owing well before the deadline.