Category Archives: Accounting Services

Making Instalment Payments to CRA

We often get the question from our clients “Why do I have to pay tax instalments?”

If you had tax owing of more than $3,000 in the prior tax year, the Canada Revenue Agency requires that you make recurring income tax payments (otherwise referred to as instalments) by a specific date.

These recurring payments are tax instalments based on income earned in the current calendar year and remitted to the government, much like an employee has tax withheld on each pay cheque by their employer. These payments are applied to the income tax that will be owing by April 30th of the following year.

There are three options available for instalment payments:
No calculation method – this method is best used when your income, credits and deductions remain consistent every year; CRA uses this amount in the instalment reminder and it is based on the last two taxation years.

Prior year option – instalments are based on the prior year tax return. This method is most suitable if your current year income, credits and deductions are similar to the prior year amount, but differs from the amount two years prior. CRA provides a calculation chart for instalment payments on their website, you can link to it by clicking here.

Current year option – This option should be considered if your income, credits and deductions are significantly different in the current year than in the two previous years. In this case, the instalment payments are based on the net tax owing on your estimated current year income along with CPP contributions and voluntary EI amounts. To assist you with the calculation, CRA provides a calculation chart for instalment payments on their website (see link above)

If you decide to use the prior year option or the current year option and make the payments in full by their due dates, CRA will not charge a penalty or instalment interest unless the amounts calculated are too low.

It is important to note that if you estimate the tax owing for the current year will be less than $3,000, you are not required to make instalment payments, even though you may receive reminder notices from CRA.

If you would like to discuss instalment payments or need further clarification on this article, contact us at Five Star Accounting. If you would like to know more about our accounting and bookkeeping services, click here.

Do You Know Your Accounting Policies and Procedures?

Do you know your businesses’ accounting policies and procedures?  Are they optimized for your specific type of business, and your operations individual needs?

If you were audited tomorrow, would your books stand up to Federal scrutiny?

Did you just break out in a cold sweat at the thought of a bunch of  “Revenooers” poring over your records, looking for inconsistencies?  If you did, it’s because you’re too busy running your business to spend your every waking moment fussing over your books.  Small businesses are the engine that drives the economy, but they are also the operations that are exposed to the greatest amount of risk.  As an entrepreneur, you are to be commended for your courage.  At Five Star Accounting, we completely understand the needs of small businesses in Winnipeg and Calgary.  We represent numerous small businesses in Winnipeg and Calgary.  We ourselves are a small business, with offices in (you guessed it) Winnipeg and Calgary.

Let our experience work for you.  We have the knowledge (kept current because we endeavor to be the best-educated accountants and bookkeepers you’ve ever met) and the experience to put your business finances in order.  We will help you set up a record keeping method that is easy to maintain, and that follows the best practices that we’ve established for all of our clients.  Once we’ve got you up and running, we’ll help you keep your accounting records up to date, so you can sleep comfortably at night knowing that your business’ books are completely in order.

We offer all the advantages of an in-house bookkeeper, without the added cost of another full-time employee.  For support with your accounting and bookkeeping needs, both in strategic planning and day-to-day support, contact Five Star Accounting, and experience our professional service and our personal touch.

What Revenue Level Dictates Outsourcing?

When will your business be making enough money to justify outsourcing some of the things you don’t want to do, or don’t do as well as someone more qualified could?

Our answer, when it comes to accounting and bookkeeping, is right from the get-go.  And we don’t say that just because we’re accountants and want to get paid.  We have years of experience in the small business marketplace.  We’ve seen firsthand the advantages that a small business that’s financially informed has, and we’ve also had to do some serious clean up work when we’ve gotten that call too late in the game.

Professional accountants have knowledge and tools that can make every stage of business growth easier.  We can do financial projections that can be instrumental in creating the initial business plan, and we can help when it comes to convincing lenders that your plan is solid.

Accountants know how to deal with the government.  In the start-up phase, you’ll be providing all kinds of compliance documents, which can be confusing and time-consuming for the uninitiated.  We spend a great deal of time learning how to navigate the legal landscape surrounding small businesses, and can put this knowledge to work for you.

Once your business is up and running, accounting and bookkeeping services will keep your cash flow flowing, your payroll paid, and your finger on the financial pulse of your business.  And, since you’ve outsourced the work, your hands will be free to do the thing you set out to do in the first place – build your business.

At Five Star Accounting, we know what it’s like being a small business in Winnipeg.  Besides fitting into that category ourselves, we have many years of experience in the field.  We know that the economy needs small businesses. Wherever you are in your business trajectory, from initial concept to full-blown operation, you can count on Five Star Accounting to provide professional accounting and bookkeeping support.  It’s never too early to get the help of a professional accountant, but it can be too late.

There’s Money to be Saved

Generally, the fewer employees a business has, the more hats each one has to wear. A truly small start-up, with only a few employees, can be a very stressful place to work.

When you’re responsible for every little thing that happens in your business, it’s easy to lose sight of the bigger ones.  We call it losing the forest in the trees.

When it comes to the financial health of your business, as an involved owner you feel a responsibility to your business, your customers, your employees, and your family to do the best you can.  After all, livelihoods depend on your ability to stay afloat.

One of the things that you’re tasked with, when your business is small, is cost control.  You have to determine, much of the time by instinct, which supplies and services are needs versus those that fall in to the category of wants.

The services of an accountant or bookkeeper almost always count as needs.  Some tasks you can perform yourself, but at great cost of time (and, if you’re like many people, sanity), and others simply require the expertise of a financial professional.

At Five Star Accounting, we have years of experience in the small business environment. We’re well versed in Canadian tax regulations, and we’re passionate about what we do.  Many business owners see bookkeeping and accounting tasks as punishment.  They’re our whole reason for existing.  We can save your business money because we know our way around cash management, payroll administration, and accounts receivable and payable.  We can help you navigate the stressful waters of business accounting, saving you money and freeing up your time to focus on the things that are important to your business.  Like your business.

Small businesses like yours are the engine that drives the economy, here in Winnipeg and across Canada.  For advice and help with accounting and bookkeeping that you can trust, contact Five Star Accounting for professional service with a personal touch.

Unification of Canada’s Accounting Bodies

On October 1st, 2014, CPA Canada announced the consolidation of three national accounting organizations.

The Society of Management Accountants of Canada, Certified General Accountants Association of Canada and the Canadian Institute of Chartered Accountants have now merged into CPA Canada.

CPA Canada represents the single national accounting body and one of the largest in the world. The creation of this organization provides Canadian professional accountants with a unified voice.

This merger took a number of years as it required approvals from 40 accounting bodies across the provinces and territories. An interesting and little known fact, it also required approval in Bermuda as accountants there are regulated under Canadian standards.

Canada has had three different accounting designations for more than a century, sometimes creating confusion in the marketplace. Companies didn’t know if they needed a CMA, a CGA or a CA or which could deliver the services they required. Businesses will now have the confidence of knowing all CPAs will be well-rounded professional with a strong foundation of knowledge and skill as a professional accountant.

If you have questions on this new designation and how it may benefit you, please contact us. We’d be happy to explain.

Helping Small Business Owners Succeed

As a small business owner, you’re often required to fill multiple roles in order to ensure your business’ success. You’re often pulled in so many different directions it’s hard for you to concentrate on what you love doing most, the reason why you decided to open your own business in the first place.

At Five Star Accounting, we are a team of experienced accounting and bookkeeping professionals who are passionate about what we do.  With our combined experience in the small business environment, we understand the unique demands of small business owners. We can help you with your small business bookkeeping and accounting requirements so that you can concentrate on what you are most passionate about.

Don’t Go Down in Flames! Avoiding Burnout in the Small Business

Wow! How did you forget to update the new maximum pensionable earnings amount in the payroll system effective January 1, 2012? Was it because you were too busy trying to catch up with the bookkeeping? And when did the mileage rate go up for employees using their personal vehicles to make business deliveries? Perhaps it was when you were driving around town to meet with potential clients, since business growth depends on your networking abilities.

If these scenarios sound familiar then you’re on the path to small business owner burnout. One of the first symptoms to appear is stress from filling multiple roles as owner, employee supervisor, customer service representative, bookkeeper, manager, purchasing director, marketing director, salesperson and human resources director. Another common symptom is important tasks not getting done in a timely manner or not getting done at all. For example, a frantic order is placed with a supplier – maybe not at the best price, either – because the business is about to run out of essential supplies.

The Business Finances – Get Reports Monthly not just Yearly!

As a small business owner, one of the most alarming symptoms is having no idea how the business is doing financially. Sure, you may keep a close eye on the bank balance but do you know if you were profitable over last quarter or even the last month? You need regular financial statements to help you navigate your business decisions. Perhaps they haven’t been printed because the accounting software needs updating, there’s a backlog of postings and account balancing to clear up, and you have no idea how to record the purchase of the new equipment as a depreciable asset. So unfortunately, you remain oblivious as to how your business is operating financially on a regular basis.  One of the first facts you need to realize as a small business owner is that buying accounting software doesn’t turn you into a bookkeeper or accountant. The power of the accounting software is often not even utilized by entrepreneurs because often they don’t know how to create and interpret management reports. These reports can help the business owner manage the business better, smarter and more efficiently.

Don’t Succumb to Wearing “Too Many Hats”

One danger sign of a business owner unable to manage business growth is when he or she believes no one else is qualified to do certain jobs. This individual then keeps taking on more and more work – wearing too many different hats. Instead of working smarter, the owner works harder and in the process falls behind. A better approach is to identify your strong skills and then determine the work that can be outsourced to professionals. Outsourcing your bookkeeping and accounting to a company such as Five Star Accounting is a good place to start because a professional can ensure the business records are kept current and that you have the financial information needed to grow the business. It’s hard to grow when you’re always looking back at work that should have been done already.

Five Star Accounting offers expertise in small business financial management.

The staff can assist by relieving you of the detailed recording and reporting, ensuring records are maintained according to accounting standards, preparing accurate financial and cash flow statements, and meeting government reporting requirements in a timely manner. Instead of counting receipts, you can spend your time strategically managing business growth and achieving financial goals. And who knows – you may just be able to make the next family birthday party or take a Sunday off to rest. The only flames you should be looking at are in the barbeque. Doesn’t that sound so much more delightful than burnout?

The Importance of Accurate Accounting

Are you aware of all the current and new tax laws and regulations? Are you keeping up with currency fluctuations with our neighbours to the south? How is the stock market impacting your business? Today’s small business owner has to wear many hats, and the same can be said of small business accountants.

Gone are the days when their only tasks were keeping up with tax returns and tracking where a company’s money was going. Today’s small business accountant has to sift through a maze of ever-changing rules and regulations while maintaining an accurate paper trail in the event of an audit. In other words, a good accountant is far more than a “bean counter.” Think of a good accountant as a trusted business advisor.

Pay Attention to Detail
Accuracy and attention to detail should be priority No. 1, especially for small business accountants who are responsible for recording, reviewing and auditing all of a company’s finances. The savvy accountant should also keep up with all the latest accounting software to ensure accuracy. The penalty for failing to keep track of your finances goes far beyond an audit; accurate accounting can make the difference between whether a small business survives or thrives.

Partnership with Common Goals
Where do you see your business in five years from now? Ten years? Today’s accountant will work with you on your goals and hold you accountable by creating, and executing, a sound business plan. After all, no one knows your company’s finances better than you and your accountant. Communication between you and your accountant, therefore, is vital to your company’s future.

Keeping your goals in mind coupled with attention to detail will provide more accurate accounting results for your business.  At Five Star Accounting, we are more than accountants and bookkeepers.  We use our business expertise, combined with our accounting backgrounds to help you achieve your goals for your small business.

We are a Better Solution for Small Businesses

At Five Star Accounting, we understand the importance of time to a small business owner. That’s why we want to work with you so that you can maximize the use of your time.  We take care of your accounting and bookkeeping so you can focus on your business.  We have a dedicated team of accounting specialists that work closely with you and learn the operations of your business.  The result is an accounting solution that is tailored to your needs.  Contact us today to find out whether you would benefit from Five Star services.

Welcome to Our New Site!

Since its founding, Hospitality Solutions Inc has gone through significant change and growth.  From our humble beginnings serving the hospitality industry, we have come a long way.  To keep up with the natural growth of our company, we are proud to announce that Hospitality Solutions Inc. has become Five Star Accounting Inc. to better represent our client’s businesses and their unique needs.

Five Star Accounting has become one of Winnipeg’s top outsourced accounting and bookkeeping services.  We have the tools and expertise to offer tailored accounting solutions for small businesses.  We understand the constraints and limitations of a small business, while at the same time recognizing the tremendous growth opportunity of each of our clients.  When your business grows and your needs change, we grow along with you.