Year-End Tax Checklist for Canadian Small Businesses

Filing a clean year-end returns shortens tax preparation, decreases the odds of getting questions by the CRA, and gets money back quicker. This checklist will help you close your books in confidence and ensure you are in the driver seat in the next fiscal year.

Get Your Books Clean

• Reconcile bank, credit card accounts and close the period.
• Automate posting of both A/R and A/P subledgers into the general ledger.
• Verify inventory counts and post adjustments.
• Capture prepaids and accruals (insurance, software, utilities).

Close user access to prior months once reconciled to prevent silent changes. Old, uncollectible invoices; duplicate vendors; suspense/clearing accounts with balances.

GST/HST: Don’t Leave Input Tax Credits Behind

Sales tax slippage is common at year-end and expensive.

Essential Reconciliations

• Tie filed returns to the GL for each reporting period.
• Review input tax credits (ITCs) on fuel, freight, subcontractors, and SaaS, many are missed.
• Check place-of-supply rules for interprovincial sales to ensure the right rate was charged.

Monthly/quarterly filers typically remit one month after period-end; annual filers have different rules, confirm your registration details.

Create a “No-HST” expense review: scan big vendors where HST should have been billed.

Payroll Year-End Without Panic

T4s and summaries creep up fast.

• Reconcile gross pay, CPP/EI, and tax remittances to CRA.
• Track taxable benefits (auto, cell, health plans) and post them before the final payroll.
• Confirm contractor vs. employee status; issue T4A where required.

T4/T4A slips and summaries are due by the last day of February. Keep records and approvals on file. Negative CPP/EI variances, missing ROEs, and unpaid source deductions.

Deductions & Credits Worth a Second Look

Reported expenses that are legitimately deductible reduce taxable income; keep these well documented.

High-Impact Areas

• CCA: choose classes and rates thoughtfully; partial-year rules matter.
• Bad debts: write off amounts proven uncollectible before year-end.
• Home office/vehicle (for proprietors): keep mileage logs and allocate reasonably.
• Meals/entertainment: remember the 50% limitation.
• SR&ED (if applicable): contemporaneous documentation beats retroactive scrambling.

Save invoices, contracts, logs, and board approvals; CRA favors contemporaneous evidence. Attach a PDF backup to every high-value journal entry in your accounting system.

Close Confidently

A focused checklist is better than a last-minute rush. And to have another pair of eyes on the reconciliations, GST/HST, or payroll slips, Webtaxonline services Canadian small businesses throughout the year and can help to review your year-end package prior to filing, discreetly, in the background.

Final 5-Item Wrap-Up

• Reconcile bank/credit cards, A/R, A/P, and inventory.
• Lock payroll benefits and T4/T4A timelines.
• Document CCA, bad debts, and mileage/home-office claims.
• Plan owner compensation and cash for return and balance-due dates.

Tight books, clear evidence, and early decisions cut tax risk and save time, this year and next.