by Nicole
(Alberta)
Bookkeeping is different than tax preparation.
I'm starting my new business with bookkeeping and am kind of having a bit a brain lapse that I'm hoping you can help me with.
I'm mainly familiar with QuickBooks (personally I have no use for Simply/Sage!); however a new client of mine...originally she was using QuickBooks - they had a bookkeeper come in to fix everything and switched to Simply. They weren't happy with this bookkeeper and were wanting me to fix everything as well as continue for them from this point on. Now, since I am much more familiar with QuickBooks, they were agreeable to going back to QuickBooks and they also said that I may need to just start from scratch - from what I can see, she started this company just in Nov. 2011 so it's more or less all of 2012 that I need to worry about.
My concern is, when it's a sole proprietorship and a business run out of your own home - do you record the costs of say...mortgage, utility bills, phone, etc. anywhere? I know this is rather an amateur question to be asking, but I've mainly dealt with small corporations. My issue is, I know that you can claim this sort of thing when filing your income tax, I'm just not sure how/if you record it in your books anywhere.
Another situation that stumped me is when, as an example - say she bought a meal or some office supplies, that surely can be written off in her income taxes but how does that get recorded when it was just paid with cash/personal account. This also goes for the mortgage/utilities; if they are paid with a personal account rather than the business account, how does this get accounted for?
I hope this makes sense, and I really appreciate the last time how you replied so quickly! :D
Thanks again,
Comments for Bookkeeping vs Income Tax Reporting
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