An accountant is an important advisor to your business so selecting one should be done with care. The right accountant or accounting firm can save your business some money, reduce your stress levels and make your life a whole lot easier.
Understand you may need both a bookkeeper and an accountant. While many small business owners try to do their own books, it’s often difficult to stay on top of changing tax rules, filing deadlines and all that record keeping – so a firm that can handle your bookkeeping as well as complete your annual returns may be ideal. Delegating tasks is essential to business success.
Follow these tips to find your perfect accountant.
1. Decide how much service you want
You want an accountant or accounting firm that can meet your business needs. Consider these questions:
- Will you do the bookkeeping, and hand files to your accountant to prepare year-end tax returns? Or, will you hire an independent bookkeeper to manage your monthly record-keeping in house, and file government remittances such as GST/HST returns?
- Would you prefer your accountant handle it all? That level of service may affect price, but you may end up paying less money than you would by hiring a separate bookkeeper.
- Will your business benefit from an accounting firm with specific experience? For example, if you’re planning to export your products or services to the United States, it may be best to work with an accountant who has experience working with exporters.
- Do you want to meet with your accountant throughout the year to obtain business advice?
Focusing on what’s most important to your company will help you narrow the field so that you can get on with your accountant search.
2. Strategies to reduce taxes
A good accountant will find deductions to lower the current amount of tax you must pay. A great accountant will develop a tax reduction strategy for your business.
In addition to proactive long-term strategies, your accountant should be available to you to provide advice on short-term decisions – such as understanding the cash flow impact of a customer seeking account credit.
3. Experience with your industry
Every accountant will be familiar with standard business expense deductions (like rent, payroll and utilities). But your perfect accountant should be aware of tax credits that are geared towards your industry or type of business. For example, agri-businesses may prefer to work with an accountant or firm that understands the myriad of tax-incentives available to farmers and companies in the agriculture industry.
4. Ask for references
Don’t be shy about asking for references from your short list of accounting firms. Speak to their clients to understand the experiences of other business owners with that professional.
- Tip: ask business owners you know to introduce you to their accountant.
And pay attention to your own first impression – you’ll be working closely with your accountant, so you want to make sure you feel comfortable with the individual or firm you choose.
5. Understand fees & billing
An accountant will actually save your business money because he or she knows how to reduce your taxes. But that expertise will naturally come at a price – so be sure to understand how much your accountant will charge for:
- Year-end returns
- Bookkeeping services (if you will outsource that function)
- Business consultation & advice
- Tax planning.
You may prefer to set up a monthly fee schedule with your selected accountant or firm to avoid a big invoice at tax time.
Lastly, start searching for your accountant well before tax season to avoid feeling rushed into making a decision. Now is a good time to start your search.
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