According to the Government of Canada’s Key Small Business Statistics report published in January 20191, nearly 75% of Canadian businesses have between 1 and 9 employees. The same study found that 99.1% of Canada’s 85,000 annual business closures occur in companies with 20 or fewer employees. Keeping track of your SME’s financial health is essential to staying above water during market fluctuations. That’s why we’ve prepared some tips to help you ensure your business remains successful.
Check in daily on your financesAvoid unpleasant surprises by checking in regularly on your company’s financial health. Whether you crunch the numbers yourself or work with an accountant, make sure you’re keeping track of where your money’s going; costs can add up quickly. Keeping an accurate record of your income and expenses can help you establish a realistic financial forecast so you can plan accordingly.
Calculate your taxable income and tax creditsWhether you run a sole proprietorship, partnership or corporation, you have to know your business’s net income. Start by deducting any reasonable business expenses, including maintenance and repairs, employee training, advertising and meals and entertainment. Understanding which deductions and tax credits you’re entitled to can help you reduce the taxes you owe, leaving you with more money to invest in your business.
Stay on top of invoicingSend invoices out as soon as possible after providing goods or services. If you can, set short payment deadlines so that your invoices don’t get lost or forgotten, and remember to follow up. Make it easy on yourself by creating automatic text or email reminders for your clients. Finally, cross-reference invoice numbers with payments to make sure you get what you’re owed.