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<p>Preparing your tax return at the beginning of the year allows you to avoid a lot of headaches and optimize your deductions. As a self-employed person, you have until June 15 to file your return, but be careful: if you owe taxes and want to avoid penalties, the payment must be made by the same deadline as individuals who are not self-employed, April 30. Good organization at the beginning of the year will help you get through this period more smoothly.</p> <h2>Gather and organize your financial documents</h2> <p>Proper preparation is essential for a hassle-free tax return. Gathering all your documents now will help you avoid last-minute stress and increase your chances of maximizing your deductions. Here are some tips on how to effectively structure your finances for the tax season.</p> <h3>Invoices and receipts related to your company&#39;s expenses</h3> <p>Compiling all <a href="https://www.momenteo.com/blog/as-a-freelancer-what-expenses-can-i-deduct">eligible expenses</a> incurred during the year for your work will allow you to reduce your taxable income, and reduce the amount you have to pay for your taxes. With Momenteo, this task becomes simple and efficient. In the Expenses tab, you can record each of your expenses and categorize them, making it easier to file your return. However, please note that not all expenses are fully deductible, which is why it is important to be well organized.</p> <p>Be sure to keep your receipts and invoices related to your expenses! You can scan them to save physical space. These documents must be kept for at least six years, in the even you have to go through a tax audit.</p> <h3><strong>Invoices and income from your business</strong></h3> <p>This answers a question frequently asked by self-employed people: if I issue an invoice on December 28, 2024, but my client does not pay it until January 5, 2025, in what year do I have to report it? The answer is simple: it must be accounted for as revenue for 2024. It is the date of issue that determines the tax year, not the date of payment.</p> <p>To simplify your management, you can give your accountant access to your Momenteo account. This will allow them to view all your invoices directly and make sure that nothing has been forgotten.</p> <p>Don&#39;t forget to also include all your other business income, such as grants, government assistance, or royalties.</p> <h3><strong>Important personal receipts and statements</strong></h3> <p>Once your professional finances are well organized, it&#39;s time to collect documents related to your personal life. Carefully file all receipts and invoices for eligible medical expenses not covered by your insurance or RAMQ, childcare expenses and charitable donations. Make sure that the date, amount and name of the business or organization are clearly visible so that you can report them correctly.</p> <p>Also remember to download your investment and RRSP statements. These documents are generally accessible directly in your customer account on your bank&#39;s website.</p> <h3><strong>Family information to have on hand</strong></h3> <p>Your tax return must also include information about your partner and your dependents. This applies not only to your children under the age of 18, but also to family members who depend on your financial support, such as a parent or sibling. You will need to provide their current address, date of birth and social insurance number.</p> <h3><strong>Anticipate and optimize your return</strong></h3> <p>Every year, the Canadian and provincial governments change tax rates, but they also make changes that can impact your tax return. Staying informed will ensure that your documents reflect accurate and up-to-date information.</p> <p>Starting your tax return in January will help you get through this often-stressful time. This will allow you to divide the work into stages and get it done a little bit each week. By doing so, you will be able to move at your own pace and avoid forgetting. Omissions in your return could cost you a lot in taxes! For example, if you forget to report an eligible expense, you may end up paying more than you need to, reducing your net income.</p> <p>Even with good preparation, some mistakes can easily creep into your return. Here are some pitfalls to avoid:</p> <ul> <li> <p>Forgetting a side income: If you have multiple sources of income (digital product sales, royalties, etc.), make sure to include everything. The revenue agency has access to many of these pieces of information and may claim unpaid amounts from you later.</p> </li> <li> <p>Misaligning personal and business expenses: Some expenses, such as home office rent or phone costs, should be calculated based on their business use. An incorrect estimate could result in a tax adjustment.</p> </li> <li> <p>Ignoring advantageous tax credits: Credits such as those for continuing education, private insurance contributions or certain medical expenses could reduce your tax bill and perhaps even entitle you to a refund. Take the time to check what you are entitled to.</p> </li> </ul> <p>By avoiding these mistakes and keeping good organization throughout the year, you will be able to optimize your declaration and the amount of your benefits while minimizing unpleasant surprises.</p> <h3><strong>Call in an expert if necessary</strong></h3> <p>If you&#39;re not used to doing your taxes or if accounting really isn&#39;t your cup of tea, it may be a good idea to leave this task to a professional. Using accountant services that specialize in self-employed taxation will not only save you time, but this professional will also help you optimize your deductions by ensuring that you take advantage of all the tax benefits to which you are entitled.</p> <p>Be sure to choose an accountant who is familiar with your field of practice, as tax rules vary from industry to industry. Working with an expert familiar with your professional reality allows you to obtain advice adapted to your situation and to fully exploit the deductions specific to your industry.</p> <p>A well-prepared tax return means time and money saved! To simplify your billing management and keep your finances organized all year round, try <a href="https://www.momenteo.com/">Momenteo</a>. This intuitive tool allows you to track your income and expenses with just a few clicks, making tax season a lot easier.</p> <p>---</p> <p>Roxane has always written and dreamed of making a living from her pen. Now a web editor, proofreader and author, we can say that it&#39;s mission accomplished!</p>