- Financial Tools for Startups Brought to You by the CRA
- March 5, 2015 | Author: Alexandra Frederick
- Law Firm: Dentons Canada LLP - Ottawa Office
- The Canadian Government partnered with Startup Canada to hold Startup Canada Day on the Hill on November 26, 2014. The Minister of National Revenue, the Honourable Kerry-Lynne D. Findlay, P.C., Q.C., M.P. highlighted the strategies that the CRA has implemented to assist Startups across the country. Startups have bright, innovative founder teams, but many lack the financial expertise, time, and money required to maintain adequate financial records that may seem insignificant in the short-term but that become important when attracting investors and in dealing with the Canada Revenue Agency (CRA).
With this reality in mind, over the past few years, the CRA has worked toward reducing the red tape associated with starting and running a business in Canada. In November of 2012, 52 small business owners and 91 small business service representatives and bookkeepers participated in meetings across the country to identify issues stemming from federal rules and regulations. The information garnered from this consultation process led the Government to streamline and simplify the way in which Canadian entrepreneurs manage their financial affairs.
How is the CRA helping Startups?
1. Through the creation of a secure online self-service portal, available 24/7 through which many different kinds of transactions can be completed, including managing banking information and filing tax returns replacing the need to keep track of copious amounts of paper;
2. Through the development of the Small Business Checklist which includes user-friendly and detailed information on starting, maintaining and winding up a business;
3. Through the Business Tax Reminders App, created in consultation with small and medium-sized business owners, which allows businesses to create reminders for when their various financial payments are due; and
4. Through the Liaison Officer Initiative which provides in -person support to businesses at key stages in their growth cycle in an effort to avoid common tax pitfalls, among other things, that would cost them in the future.
While these tools will not make Startup founders financial experts overnight, they provide a solid starting point within a collaborative framework, rendering tax compliance less daunting, so founders can focus on what’s most important to them - making their business grow. As part of the Government’s commitment to consult with businesses every two years, the CRA recently completed another red tape reduction consultation process in November, which is part of the Canadian Government’s ongoing action plan to reduce the burden on businesses, to make it easier for businesses to deal with regulators and to improve the level of service and predictability. Results will be available in the Spring of 2015.