Canexi Accounting & Tax Solutions Blog

1. Reconcile All Accounts

Compare monthly bank, credit card, and loan statements line-by-line against your ledger, flagging discrepancies exceeding your material threshold (e.g. based on a percentage of revenue, or simply a fixed amount) with supporting docs like receipts or bank letters. Resolve issues via adjustments or inquiries promptly—this catches fraud, duplicate entries, or missed transactions, yielding clean data essential for T2 filings and lender reviews; finish by December 20 to buffer corrections and avoid holiday slowdowns.

​2. Manage Receivables

Pull detailed aging reports to target 60-90+ day-overdue invoices with personalized follow-ups like phone calls, demand letters, or payment plans, while assessing specific doubtful accounts based on historical collection data, debtor financials, and recovery efforts (e.g., derive allowances from past write-off rates per aging bucket). Document evidence like credit reports, correspondence, and management approvals for reserves under Income Tax Act (ITA) s.20(1)(l) (with next-year reversals per s.12(1)(d)) or permanent write-offs under s.20(1)(p) (unless recovered under s.12(1)(i)), to withstand CRA scrutiny and reflect true collectible values.

​3. Handle Payables

Compile a full list of unpaid supplier invoices and accruals for goods/services received by year-end, then selectively process payments via electronic funds transfer or checks only on invoices offering early-pay discounts (e.g., 2/10 net 30 terms) by their due dates. This captures cash savings (e.g., 2% reduction) without unnecessary outflows, while ensuring all incurred expenses are properly accrued for current year’s deductions under accrual-basis rules—preserving liquidity, timing costs accurately, and supporting reliable cash flow forecasts.

​4. Inventory Review

Organize a comprehensive physical count across warehouses or sites using serialized tags, cycle counts for high-value items, and reconciliations to perpetual records, then value consistently using first-in, first-out (FIFO) or weighted average cost, and test for obsolescence/declines to net realizable value amid current year’s supply issues. Identify and impair obsolete/damaged stock with evidence like market quotes or photos, adjusting cost of goods sold for accurate profitability reporting.

​5. Fixed Assets Update

Scrutinize your fixed asset ledger for current-year additions, sales, or impairments. Compute book depreciation per ASPE 3061 from the date available for use, while noting CRA’s half-year rule under Income Tax Regulations Subsection 1100(2) for capital cost allowances (CCA) on net additions. Record disposals by comparing proceeds to net book value for gain/loss recognition, update insurance schedules to reflect current asset values and coverage needs, and remove fully depreciated items—ensuring balance sheet integrity for tax CCA claims, financing covenants, and risk protection.

​6. Payroll Finalization

Sum up final pay runs—including performance bonuses, commissions, statutory holiday pay, and accrued vacation liabilities—then file PD7A remittances per your CRA remitter type due dates and reconcile year-to-date payroll ledgers. Pre-format data for T4/T4A slips due February 28, 2026, reflecting updated YMPE and CPP2 maximums to ensure accuracy and avoid late-filing penalties.

​7. Tax Optimization Strategies

Canadian-controlled private corporations (CCPCs) may consider purchasing zero-emission vehicles (ZEVs, Class 54) before year-end to access enhanced first-year CCA at 75% declining balance (subject to $61,000 cost cap per vehicle), along with accelerating prepaid insurance or minor repairs for current deductions. Review investment portfolios to realize capital losses by December 31, offsetting up to 50% of 2025 capital gains (or carrying back three years/forward indefinitely), while adhering to superficial loss rules by avoiding repurchases of identical property within 30 days. These are general CRA-compliant approaches—consult a tax professional to assess suitability for your specific situation.

8. Transfer Pricing Docs

For intercompany or cross-border transactions (e.g., with Asian entities), draft contemporaneous documentation per CRA Transfer Pricing Memorandum 2025 guidelines, including functional/ risk analyses, economic benchmarks, and interquartile testing. This helps defend Base Erosion and Profit Shifting (BEPS)-aligned audits, avoiding 10% penalties on transfer pricing adjustments under ITA s.247(3).

​9. Verify E-Filing Compliance

Tally per type 2025 T-slips—if six or more of any single type (T4s, T5s, NR4s), prepare mandatory XML e-filing via certified software starting January 1; all GST/HST returns electronic regardless. Test portals now, train staff, and note $125+ non-electronic filing penalties per type under expanded CRA powers.​

10. Tax Planning Check

Assemble draft financials to forecast taxable income, pinpointing credits like expanded Scientific Research & Experimental Development (SR&ED) (35% enhanced rate up to $3 million to $6 million for CCPCs post-Dec 2024) or clean technology Investment Tax Credits, while confirming deadlines: balance due February 28, 2026 (June 15 for sole props), T2 by June 30. Strategize deferrals through shareholder bonuses after year-end or billed-but-uncollected revenue to optimize brackets.

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Specialized firms like Canexi Accounting & Tax Solutions assist SMEs with these intricacies for seamless CRA adherence—professional review maximizes outcomes without solicitation. Prioritizing now guarantees compliance, efficiency, and momentum into 2026

*General Information Disclaimer (as of 2025-12-17)* 

This blog provides educational insights on Canadian accounting, tax, and international SME topics based on current public CRA guidelines and standards. Laws change frequently, so content may become outdated—verify with official sources. Canexi Accounting & Tax Solutions provides general insights; this is not professional advice. As a non-public practice, we focus on advisory services—contact us for tailored guidance. We offer no guarantees or liability for decisions based on this material. Consult a qualified CPA for personalized needs.