Introduction

January often symbolizes renewal. After the holiday rush, it is the perfect time to get your affairs in order. While accounting is often perceived as a chore, it remains the pillar of your company's financial health.

To avoid being overwhelmed when tax season arrives, here are 5 easy accounting resolutions to implement right now.

1. Close Out the Previous Year Cleanly

Before diving into the new year, make sure the previous one is properly wrapped up. January is the critical month for gathering the final missing pieces.

• Gather all invoices: Ensure no expense receipts from December are missing.

• Review unpaid invoices: Follow up with clients who haven't paid their bills from last year yet.

• Inventory: If you sell physical products, ensure your stock value as of December 31st is accurate.

2. Go "Paperless" (or close to it)

If your desk is buried under receipts and paper invoices, January is the time to change your method. Losing receipts is one of the main causes of tax audits or missed deductions.

3. Update Your Forecast Budget

Navigating without a budget is like driving with your eyes closed. Take advantage of the relative calm of January to set your financial goals.

Compare your actual results from last year with your forecasts. Where did you spend more than expected? Which revenue streams can be increased? Create a realistic budget that takes cash flow into account to avoid nasty surprises.

4. Anticipate the Tax Calendar

Nothing is worse than discovering a payment deadline the day before it's due. Mark key dates in your calendar right now:

• Sales tax filings (GST/HST/VAT).

• Tax installments.

• Deadlines for issuing tax slips or records of employment for employees and contractors.

5. Strictly Separate Professional and Personal Finances

This is a golden rule often forgotten by new entrepreneurs. If you haven't already, open a bank account dedicated solely to your business activity. This significantly simplifies bank reconciliation and offers immediate clarity on the profitability of your business.

The January Checklist ✅

To help you out, here is a quick list of tasks to check off this month:

• [ ] File December invoices and receipts.

• [ ] Complete the final bank reconciliation of the past year.

• [ ] Check for new tax rates or fiscal changes effective January 1st.

• [ ] Schedule a meeting with your accountant to prepare for year-end.

Conclusion

Accounting rigor doesn't require you to be a numbers expert, just consistent. By adopting these few habits in January, you ensure a smoother year ahead, allowing you to focus on what really matters: growing your business.

Need help seeing the bigger picture? Our team is here to support you in closing your fiscal year and setting up your management tools for this new year. Contact us today!