We all know dealing with taxes (which we know can be dreadful, as we talked about in our blog on taxes here) is rarely at the top of anyone’s to-do list. Between running a business, managing day-to-day tasks, and, well, just living life, it’s easy for paperwork to pile up and deadlines to slip by. Before you know it, another tax season rolls around, and the thought of sorting through months (or years) of financial records feels like an impossible task.
But here’s the thing—getting caught up doesn’t have to be as overwhelming as it seems. Most of the stress comes from not knowing where to start or worrying about how bad things might be. Maybe your bookkeeping has been inconsistent (if you don’t know what bookkeeping is, read our blog about it), receipts are scattered, or you’re unsure what deductions you’re missing. Whatever the case, avoiding it only makes things harder in the long run. Luckily, there is a way forward.
With the right approach, you can bring order to the chaos, get your taxes filed, and even uncover savings you didn’t realize were there. And once you’re back on track, staying organized becomes much easier.
How to Organize Your Finances and Tackle Overdue Taxes
That said, let’s break this down step by step and get you moving in the right direction—without the stress.
Step 1: Face the Numbers (It’s Not as Scary as You Think)
If we’re being honest, one of the biggest reasons business owners fall behind on taxes is that numbers feel overwhelming (for some even, the idea of money can carry a heavy weight, as we talked about in our blog 5 Steps To Conquering Your Money Avoidance & Fear). If your books are a mess, or worse, non-existent, the thought of sorting through everything can feel impossible.
But here’s the good news: you don’t have to do it all at once! Take a deep breath, grab a coffee (or something stronger—no judgment), and start with a simple step: gathering everything in one place.
What You Need to Collect:
- Bank and credit card statements (for all business accounts)
- Invoices issued and payments received
- Receipts and expenses paid (yes, those crumpled ones too!)
- Loan statements, if applicable
- Payroll records (if you have employees)
- Any government correspondence (HST/GST filings, notices, etc.)
If you don’t have all of these, don’t panic! Just start with what you do have.
Step 2: Sort & Categorize Transactions
Once you have all your financial documents in one place, it’s time to start organizing. If you’ve been diligent about keeping business and personal expenses separate, great! If not, now’s the time to sort things properly.
How to Organize Your Transactions:
- Go through your bank and credit card statements and separate business from personal expenses.
- Match receipts with transactions (if possible) and note any missing ones.
- Categorize your expenses—rent, supplies, marketing, software, etc. (If you’re unsure, a bookkeeper can help!).
If you use accounting software like QuickBooks, you can import your bank statements and categorize transactions directly. If not, a simple spreadsheet will do the trick.
Step 3: Check for Missed Tax Deductions
One of the biggest mistakes business owners make when catching up on taxes is not claiming all the deductions they’re entitled to. You don’t want to leave money on the table!
Here are some common deductible expenses small business owners often forget:
- Home office expenses (portion of rent/mortgage, utilities, internet, etc.)
- Vehicle expenses (gas, maintenance, insurance—if used for business)
- Marketing costs (website, ads, social media, etc.)
- Software subscriptions (QuickBooks, Canva, Zoom, etc.)
- Professional fees (lawyers, bookkeepers, accountants)
Even if you’re behind, make sure you take full advantage of these deductions before filing!
Step 4: Get Your Sales Tax in Order
If you’re registered for HST/GST, the CRA expects you to file your returns on time—even if you can’t pay right away. If you’re behind on sales tax filings, now is the time to calculate what’s owed and submit those returns ASAP to avoid additional penalties.
What to Do If You Owe Sales Tax:
- File your overdue HST/GST returns (even if you don’t have all the funds to pay immediately).
- Contact the CRA if you need to arrange a payment plan.
- Moving forward, set aside sales tax collected in a separate bank account to avoid future cash flow issues.
If your books aren’t up to date and you’re unsure what you owe, that’s where a bookkeeper comes in!
Step 5: File Your Taxes & Avoid Penalties
Now that everything is organized, it’s time to file your tax return. If you’ve missed previous years, you may be worried about penalties, but there are ways to reduce the damage:
- File ASAP: The sooner you file, the less interest and penalties you’ll owe.
- Use the CRA’s Voluntary Disclosure Program (VDP): If you have unfiled returns, this program can sometimes reduce penalties.
- Work out a payment plan: If you owe taxes but can’t pay in full, the CRA may allow installment payments.
Once you file, make sure you get a plan in place to stay on track going forward.
Step 6: Get Professional Help (So You Never Fall Behind Again!)
If the thought of doing all of this on your own makes you want to crawl under a rock, don’t worry—I offer services that can help you. Catching up on taxes is a process, but it doesn’t have to be stressful.
What I Offer:
- Clean-up bookkeeping services to get your records tax-ready
- Monthly bookkeeping so you never fall behind again
- A simple and affordable way to stay organized year-round
It’s okay if you’re behind—I’ve helped clients catch up on 1, 2 — even 3 years’ worth of taxes!
Final Thoughts
Taxes might not be the most exciting part of running a business, but getting them sorted is a game-changer. There’s something empowering about knowing everything is in order, no more looming deadlines, no more second-guessing what you owe. Just clarity, peace of mind, and a fresh start.
If you’ve been putting this off, consider this your sign to tackle it now. It doesn’t have to be overwhelming, and you don’t have to figure it out alone. Whether it’s organizing your records, maximizing deductions, or filing overdue returns, I’m here to help make the process smoother.
So, don’t let tax time stress you out another year. Let’s clean up your books and get you back on track. Book a free consultation today, and let’s get started!
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