Trenval workshop on preparing your accounting and records for year end including a Checklist. Loyalist College Inventory, Petty Cash, Mileage Logs, Invoicing customers etc http://poweroffice.ca

1. PLANNINGFORYEAREND
KNOW&GOWORKSHOPS
PeggySeville
December14,2015

2. •YearEndChecklist•YearEndChecklist1
•Quiz•Quiz2
•ReviewAnswers•ReviewAnswers3
Today’sOverview

3. AboutMe
•ProvidingaccountingservicesandQuickbooks
support&trainingsince1994
•CertifiedQuickbooksProAdvisorsince2007
•PassedCertifiedGeneralAccountant’s(CGA)
certificationexamsinJune
•WillhaveCharteredProfessionalAccountant(CPA)
designationbySeptember2018

4. YearEndChecklist

5. COUNTINVENTORY&SUPPLIES
•OnorbeforeDecember31st
•Makealistincludingdescription,quantity,costper
item,totalcost
•Identifyitemswithmarketvaluelowerthancost
•DifferencetoInventoryWriteDowns–CostofSales

6. COUNTPETTYCASH
•OnorbeforeDecember31st
•Recordamountonhand
•Makealistofanycashreceived,who,date,
amount,HST,whatwasitfor?
•Makealistofanycashpaid,who,date,amount,
HST,whatwasitfor?

7. RecordVehicleOdometerReading
•WritedownthereadingonDecember31standkeepitina
safeplace.You’llneeditattheendofnextyeartoo!
65,000kmsDecember31,2015
Less
41,000kmsDecember31,2014
=
24,000kmsTotalKmsDriven2015

8. UpdateMileageLogs
DateDestinationPurposeofTrip#Kms
11/13/15432DundasStEVisitABCCompany18
11/15/15882FrontSt.CIBC–Bankdeposit12
11/16/15190BellBlvdStaples–buysupplies8
TOTAL:38
DirectMethod
•Calculate%businessuseofvehicle-#kms
frommileagelog/totalkmsfromodometer
reading
SimplifiedMethod
•#kmsfrommileagelogx$0.55/kmforthe
first5,000kmsand$0.49/kmafter

9. Fuel
Insurance–
copyof
policy
GatherallVehicleReceipts
-FortheDirectMethod
Repairs&
Maintenance
License&
Registration
Copiesofbill
ofsale–new
vehicle
purchases
Copyof
lease/loan
agreements

10. InvoiceallCustomers
•Invoiceallcustomers
byDecember31st.
•Forallworkdonein
2015

11. WorkinProgress
•You’vetakenadeposit
butnotallworkis
completedby
December31st.
•Estimatethe%
completedxquoted
amount
•=WorkinProgress

12. ReviewUnpaidInvoices
•Determineiftheyaregoingtobepaid
•Theymayneedtoberecordedasbad
debtsandhavetheHSTreversed
•Givecopiestoyouraccountant

13. MakeaListofHomeOfficeExpenses
•CalculateBusinessUseofHome%
•Sq.FootageOfficeSpace/TotalSq.Footage
ofHome=%businessuse
•Multiply%businessusexeachexpense
MonthInsuranceRentor
Mortgage
Interest
Property
Tax
Maint-
enance
Utilities–
Hydro/Gas
Jan/15106.851100.00400.0050.00250.00
Feb/15106.851100.00400.0025.00275.00
Mar/15106.851100.00400.0035.00260.00
TOTALS:320.553300.001200.00110.00785.00

14. GatherUnpaidBillsatDec31st
•Provideyourbookkeeperoraccountantall
billsthatwereunpaidasofDecember31st.
•Theyneedtoberecordedasexpensesin
2015eventhoughtheyweren’tpaidyet.

15. ListUnclearedChequesonDec31
•MakealistofchequesyouwroteinDecember,but
didn’tgothroughyourbankaccountuntilJanuary.
•Theyneedtoberecordedasunclearedcheques

16. GatherReceiptsforAssetPurchases
•Yourtaxpreparerwillneedcopiesofasset
purchasesoralistofdetailsandcosts
•Over$500forequipment,furniture,tools,
computers,etc.withalastingbenefit

17. •Reviewestimatedtaxableincomebeforethe
endofDecember.
•Makeadditionalexpensepurchasesorasset
purchasestoreducenetincomeaccordingly
•Remember,assetpurchasesareNOT100%
deductible.Onlyportionisdeductibleand½in
theyearofpurchase.
PlanAsset&OtherPurchases

18. FederalTaxRatesfor2015
%TaxableIncomeLimit
15%First$44,700
+22%Next$44,701to$89,400
+26%Next$89,401to$138,585
+29%Over$138,586
OntarioTaxRatesfor2015
%TaxableincomeLimit
5.05%First$40,922
9.15%Next$40,923to$81,847
11.16%Next$81,848to$150,000
12.16%Next$150,001to$220,000
13.16%Over$220,001

19. •PaybyJanuary15,2016
•Toavoidlatepenalties
PayPayrollDeductions

20. •Candeductfromself-employmentincomeif:
•Netincomefromself-employmentis50%or
moreoftotalincome
•Incomefromothersourcesis$10,000orless
•Activelyengagedinbusinessactivities
•Premiumsareforyou,yourspouse,family
membersofyourhousehold
MakeaListofPaymentsforPrivate
HealthInsurance

21. •ByFebruary28,2016for
anyemployees
•FileT4’sandT4Summary
•Youwillneedawebaccess
codeorlogintoCRA
businessaccount
•Payanydifference–interest
mayapply
IssueT4’sandE-File

22. •ByFebruary28,2016foranyindividualsyou
paid$500ormoretoin2015
•MustissueaT4A(orT5018ifacontractor)even
thoughnopayrolldeductionswereheld
•FileT4A’sandT4ASummary
•YouwillneedawebaccesscodeorlogintoCRA
businessaccount
IssueT4A’sandE-File

23. •ByFebruary28,2016foremployeesand
subcontractors(construction)
•Alsoyourownwages(construction)
ReportInsurableEarningstoWSIB

24. •Forself-employmentsole-proprietorshipsor
partnerships.Deadlineforyouandyourspouseis
June15th
•BUT….paymentmusthavebeenmadeApril30th
•Don’twaituntilMayorJune!
FileIncomeTaxReturn

25. •Annualdeadlineforself-employedpersonsisJune
15th
•BUT….YoumusthavepaidthebalancebyApril30th!
FileHSTReturn

26. •Ifyour2015taxespayableweremorethan$3,000,
youmayberequiredtomakeinstallmentpayments
•Unlessyour2016taxespayablewillbelessthan
$3,000
•CRAwillnotifyyou.Canuseprioryearcalculationor
estimatedcurrentyearcalculation
•Startsettingaside$$from2016depositstosavefor
taxes.Putinaseparatebankaccountanddon’t
spendit!
PlanforNextYear’sTaxes

27. •Ifyour2015HSTpayableweremorethan$3,000,
youwillberequiredtomakequarterlyinstallment
payments
•Divide2015HSTpayableby4togetthequarterly
amount
•Startsettingaside$$from2016depositstosavefor
taxes.Putinaseparatebankaccountanddon’t
spendit!
PlanforNextYear’sHST

28. QUESTIONS?

29. QUIZ!

30. 1.YoupurchasedsomeinventoryitemsinFebruary
for$200each.Youwereunabletosellthemand
stillhadthemonhandonDecember31st.You
estimatenowthattheyareonlyworth$100each.
Whatamountwouldyouusetorecordthe
inventoryitemsonDecember31st?Whatisthe
difference?
$100each
$100eachtoInventoryWriteDown–CostofSales
QUIZ

31. 2.Youkeepa$200floatinyourcashregister.In
December,youstartedwith$200,collected$500in
salesandtook$300cashoutoftheregistertopayfor
supplies.Whatisyourpettycashbalanceon
December31st?Howmuchinexpensesshouldyou
record?
$400inpettycash
$300inexpenses
QUIZ

32. 3.Howdoyoucalculateyourtotalkmsdrivenforthe
year?
EndingOdometerReading
Less
BeginningOdometerReading
QUIZ

33. 4.Ifyourtotalkmsdrivenfortheyearwas10,000and
yourmileagelogsshowedthatyoudrove8,500kms
forbusiness.Whatisthe%businessuseofyour
vehiclefortheyear?
85%
QUIZ

34. 5.Ifyouownavehiclepersonallyanddriveit40%of
thetimeforbusiness,whatisthebestmethodtouse
forrecordingvehicleexpenses?
SimplifiedMethod
QUIZ

35. 6.InDecember,youcollecteda$1,000depositfroma
customertodosomerenovationworkworth$5,000in
theirhome.AttheendofDecember,youestimate
thatyouhavecompleted50%oftheworkbutyou
can’tinvoicethecustomeruntilJanuarywhenthe
workisfinished.Whatisthistypeofworkcalled?
Whatistheamountofworkthatshouldbeclaimedas
income?
WorkinProgress
$2,500Income
$1,000CustomerDeposit(liability)
QUIZ

36. 7.Howdoyoucalculatethe%businessuseofyour
homeofficespace?
Squarefootageofofficespace
Dividedby
Totalsquarefootageofhome
QUIZ

37. 8.InDecember,youpaidforsomesuppliesinthe
amountof$800.Youpurchasedadditionalsupplies
for$400,butyoudidn’tpayforthemuntilJanuary.
Whatisthetotalamountofsuppliesexpenseto
recordforDecember?
$1,200
QUIZ

38. 9.Whatisthecriteriausedtodefineanasset?
LastingBenefit(longerthan1year)
$500ormore
QUIZ

39. 10.Whatisthedeadlinedatetopaypayroll
deductionsfor2015?Whatisthedatetoissueand
fileT4’s?
January15,2016
February28,2016
QUIZ

40. 11.YoupaidBruceCrawford$600in2015tomake
deliveriesforyourbusiness.Youdidnotwithhold
payrolldeductionssincetheworkwasdoneona
casualbasis.WhatformdoyouneedtofileforBruce
for2015?Whatisthedeadlinetofiletheform?
T4A
February28,2016
QUIZ

41. 12.YouarerequiredtoreportearningstoWSIBfor
yourhomerenovationbusiness.Duringtheyear,you
employedonepersonandpaidthem$35,000.You
paid$10,000eachtoacoupleofindividualsas
subcontractorsduringtheyear.Youestimatethat
yournetincomefromthebusinesswillbe$60,000.
Howmuchinsurableearningsshouldyoureportto
WSIB?Whatisyourreportingdeadline?
$105,000
February28,2016
QUIZ

42. 13.Whatdatedoyouneedtofileyourincometax
returnforyouandyourspouse?Youestimatethat
yourtaxesowingwillbe$5,000.Whendoyouneed
topaythisamount?
June15,2016
April30,2016
QUIZ

43. 14.Youpaidatotalof$4,000inHSTfor2015.What
willyourquarterlyinstallmentsbefor2016?
$1000/quarter
QUIZ

44. YOUPASSED!