Frequently Asked Questions

Looking for the answer to a specific question around business bookkeeping? Continue reading for comprehensives answers on some of the questions we often hear from business owners.

How much do bookkeepers charge per hour in Ontario?

Certified Professional Bookkeepers with credentials or specialized knowledge may charge between $50 to $100+ per hour, especially if they offer more advanced services like financial reporting, tax preparation, or consulting.

Monthly or Flat Fees

Many bookkeepers offer monthly packages based on the volume of transactions or services required. These packages may range from:
- Small businesses: $300 to $700 per month.
- Medium-sized businesses: $700 to $1,500 per month or more for more complex accounts or larger transaction volumes.
Some bookkeepers also provide flat rates for specific services, like year-end financials or tax preparation.

Factors Affecting Pricing:

Complexity of Work: Businesses with more transactions, multiple employees, or complex financials typically incur higher fees.
Software Use: If the business uses specific accounting software like QuickBooks, Xero, or custom tools, the bookkeeper’s familiarity with these can influence the rate.
Scope of Services: Full-cycle bookkeeping (managing payroll, accounts payable/receivable, bank reconciliations, etc.) tends to cost more than basic services like data entry or simple bank reconciliations.

How much should I budget for a bookkeeper?

There is no one set amount to count on, unfortunately. The amount to budget ultimately depends on the size of your business and the complexity and breadth of your bookkeeping needs, including payroll, cash flow management, etc.

It’s a good idea to talk with several different bookkeepers to get a sense for their rates and to ensure that it includes the necessary services.

Does a small business need a bookkeeper?

Yes! A professional bookkeeper helps you keep accurate financial records, reduce errors that could lead to penalties, produces financial reports to give you a better understanding of your financial position, and makes sure you are compliant with all requirements from CRA, should an audit be required.

A bookkeeper can also save you the time required to learn the ins and outs of navigating payroll, sales, and corporate tax obligations.

What program do most bookkeepers use?

Quickbooks Online is a very popular option. It is advertised to small business owners as an easy-to-use system for accounting and bookkeeping — however, it doesn’t teach you how to do bookkeeping. Quickbooks doesn't offer the support to ensure that you are being compliant with CRA or give instructions on how to properly reconcile accounts, create HST reports, and capitalise assets in the Balance Sheet.

Regardless of which program you use, there will be a learning curve that you can either work through on your own, or with the help of a bookkeeping professional.

What is the best bookkeeping method for a small business?

When planning for your bookkeeping, you’ll need to decide on whether you will opt for accrual or cash accounting. Read on to find the key differences and when to choose one over the other.

Choosing the Right Method:

Small or Freelance Businesses: Cash basis accounting is often more practical for very small businesses or sole proprietors, as it's simple and reflects their immediate cash position.
Growing Businesses: Accrual basis is generally more suitable for growing businesses, especially if they have inventory, offer credit to customers, or want to scale their operations.
Businesses with Inventory: For businesses selling goods or managing inventory, accrual accounting is usually the best option to provide accurate financial reporting.

Tax Considerations: Accrual basis can better align with tax planning strategies, particularly for businesses needing to match expenses and income in the same reporting period.

How are small businesses taxed in Canada?

Sole Proprietorship/Partnership

Taxes are paid at the personal level, and income is subject to personal marginal tax rates.

Corporation

Small businesses incorporated as CCPCs can benefit from lower corporate tax rates, especially with the small business deduction, but profits are taxed again at the personal level if distributed as dividends.