Things are moving fast. This page has already been superseded. Please consult our COVID-19 summary page for more direction.

What you need to know about COVID-19 for your businessCOVID-19 is hitting business owners really hard. In this video Fuel Accountant’s founder, Peter McCarroll, discusses what you need to be thinking about and doing right now and what government assistance is available to you and your staff in New Zealand. Based on data available to 19 March 2020.

IMPORTANT: This post is specific to Canada. If you are not a Canada business/taxpayer then it is probably not applicable to you.

Things are moving fast. This page has already been superseded. Please consult our COVID-19 summary page for more direction.

What you need to know about COVID-19 for your businessCOVID-19 is hitting business owners really hard. In this video Fuel Accountant’s founder, Peter McCarroll, discusses what you need to be thinking about and doing right now and what government assistance is available to you and your staff in Canada. Video is based on data available on 18 March 2020.

Gone are the days when accountants used to spend a month at the end of the year going through the piles of ledgers. Today even the smallest organization owns some form of accounting software to simplify and organize their bookkeeping. However, if you still rely on the traditional bookkeeping practices, you know better how challenging it is to keep up with the high volume accounting and finance records. It is quite overwhelming for you to manually process every monetary transaction at the end of each month from the financial data resting in various accounting systems. Worse yet, inaccurate accounting data can cause a rippling impact in your business operation, from inventory to sales. It simply means that you are wasting your time and even putting your enterprise in jeopardy.

Accounting software is a remedy to all these woes associated with finance management. Accounting software handles accounting and bookkeeping, including storing your enterprise’s financial data and business transactions. It’s an efficient solution that eliminates manual data entry, such as keying in data on the quote, processing the work order, and then performing the invoice. This way, it helps you with paying bills on time, invoicing customers, and managing your books. It also keeps you in compliance and avoids tax penalties. And the good thing is that you don’t need to be an accountant or a math freak to operate today’s accounting system. Thanks to their user-friendly interactive.

This crucial step is so often overlooked. But without knowing your starting point, you don’t know what your path to success looks like. It sounds obvious, but many business owners plan for the future without fully understanding where they are now.

Answer the following questions honestly to help define where you are now (warts and all):

1. How aligned are the owners / leaders of your business?
If asked independently, would the leaders have the same vision for the business? Conflict must be addressed and thinking aligned before we can plan the future.

It’s amazing what we, as humans, don’t even know that we don’t know. New learning opportunities are everywhere, and in this digital world, there’s simply no excuse to avoid new learning.

Consider how many new things a five-year-old learns each day. Children enthusiastically embrace the world of possibility and the desire to learn. Why is it that, the older we get, the more likely we are to close our minds to new learning?

We’re all busy, and sometimes we feel like we just don’t have the time to sit down and read a book. We need to make the time. Set yourself targets and share these with someone who will hold you accountable to achieving these.

What exactly does your better business look like? Be crystal clear on what you want from your business; it’s there to serve you, not the other way around.

The average person spends 40,000 hours at work over their lifetime and life is simply too short to be stuck doing things we don’t enjoy. Make the most of your time and do what you love doing.

We have lots of clients who do their own bookkeeping in Xero. Here are our Best Practices for managing your own bookkeeping:

• Keep your personal transactions out of the business bank account.  If you need to spend on something personal transfer funds to your personal account and pay from there!  The transfer to yourself (and any personal spending you do include) is Drawings/Shareholder Loan.
• Add your expenses as Bills or Spend money as you incur them.  This will avoid missing things.  Use Xero’s Email to Files or Email to Bills feature to get documents into the queue, or for more powerful features talk to us about Receipt Bank.

You’re in business, congratulations, that takes courage and commitment.

It’s not easy, and at times you might question why you’re even doing it, particularly after the impact Covid-19 and the associated lockdowns had on business.

But you’re here because you had a vision. You decided being in business was a better way to achieve that vision than working for someone else. And, you’re right; you just have to work on it.

IMPORTANT: This post is specific to Canada. If you are not a Canada business/taxpayer then it is probably not applicable to you.

Many Canadian business owners operate their business through a corporation rather than as a Sole Proprietor. The most common question we get is whether the owner should draw their income as a salary or as dividends. The answer, like most tax questions, is: It depends!

IMPORTANT: This post is specific to Canada. If you are not a Canada business/taxpayer then it is probably not applicable to you.

Many Canadians support non-profit organisations through Charitable Contributions. But as a business owner, which is the most tax-efficient way to donate? Through your corporation or personally? The answer, like most tax questions, is: It depends!

Let’s look at a scenario of a company with $80,000 in net income and a target $5,000 donation. For the sake of this example we are assuming that this is a Corporation (not a Sole Proprietor – see below), all income is active business income eligible for the Small Business Deduction, the owner is receiving remuneration exclusively by dividend, company is distributing all available bet income to the owner and has no other income or deductions. I am using 2019 Ontario tax rates.

IMPORTANT: This post is specific to New Zealand. If you are not a New Zealand business/taxpayer then it is probably not applicable to you.

When it comes to paying bills, we often tend to be blasé and put our financial responsibilities into the too hard basket. Ignoring debt is the easy option at the time but eventually things catch up with you. When it comes to paying tax, it is even more important to stay on top of your obligations to avoid potential tax debt. So what happens if I do get behind? You should try to avoid getting to this point, but it is likely the IRD will contact you if you miss your payments.

IMPORTANT: This post is specific to Canada. If you are not a Canada business/taxpayer then it is probably not applicable to you.

Wonderful – welcome to the excitement of owning your own business. If you’re still in the early stages of starting your business here are some things you might want to do early:

Incorporate a Company

There are several advantages of trading as a Corporation rather than a Sole Proprietor. These include:

IMPORTANT: This post is specific to New Zealand. If you are not a New Zealand business/taxpayer then it is probably not applicable to you.

For the purpose of these changes a contractor is someone who supplies their labour to a third person as an “independent contractor”. Those in the trades are commonly referred to as contractors and may not necessarily be affected by these changes (although labor-only subcontractors are). The changes are:

One thing that constantly amazes us is how quickly each year passes. The days, weeks, and months seem to roll into one, and before you know it, 8 months have passed. You’re left wondering ‘where did the time go?’

Now that’s okay as long as you plan accordingly. However, most people spend more time planning their holidays than planning their time. If you plan – you get more done, much more done. If you fail to plan and set goals, it’s surprising how little you’ll accomplish.

You need to retain sufficient documentation to substantiate your claim to an expense deduction and GST Input Tax Credit. The requirements are slightly stricter for something that includes GST (Note: GST refers equally to GST, HST and QST – we’ve simplified to GST here).

Debit/Credit Card receipts and Paypal transaction receipts are generally not sufficient – they are merely proof that a transaction occurred and contain much of the same information as found on the bank statement, but not much else – you should keep the original invoice/order detail.

A s long as you provide excellent value – people will flock to your business and pay handsomely for the privilege.

Business owners often make the mistake of thinking that price is the main issue in the mind of their prospects or customers. But what they’re missing is this: if everyone is viewed by the prospect as ‘the same’ – i.e. companies don’t take the time or effort to differentiate themselves from others and add considerable value – the only way the prospect can choose is based on price.

Bookkeepers can be highly beneficial for businesses of any size. They offer expertise and insight into areas that you may not have experience in. They can also take some tasks off your to-do list, freeing up your time and energy to focus on other matters.

Receipts are vital to successfully running a business. You need receipts to track your purchases and expenses. Your clients need receipts for their tax purposes and to manage their finances. Paper receipts have been around a long time, so many people are used to them and may even be resistant to moving away from them.

Thanks to technology, paper receipts are becoming more a thing of the past. There are environmental reasons for the move. Paper receipts require millions of trees and billions of gallons of water to produce, and they emit carbon dioxide (CO2), so going paperless can be a good thing for the environment.

If you want to improve, you have to measure your results to see what isn’t working and, more importantly, what is. The good thing is, if you have a Twitter account set up, you can view your analytics for FREE.

‘Why do I need to see my analytics?’ you might be wondering. As with every other marketing strategy, you should be evaluating the results so you can prioritize your time on strategies that give you the results you want. And everything is displayed simply on your screen so you don’t have to be a marketing expert to understand what pieces of data to dig out.

IMPORTANT: This post is specific to New Zealand. If you are not a New Zealand business/taxpayer then it is probably not applicable to you.

Overtime Meal Allowances
Question : In the lead-up to Christmas the elves are required to put in long working days and to work well into the evening beyond their normal work hours.  As a result, Santa is paying the elves a meal allowance in addition to their normal wages and overtime pay.
Will the meal allowances be taxable income to the elves?
Answer :  The starting position is that any monetary benefit employees receive in connection with the performance of their employment will form part of their income. However, an amount that an employer pays to an employee for a meal while that employee is working overtime may be exempt income of the employee.