Some takeaways from the interview:
- As an entrepreneur, it’s important to have a bookkeeper or bookkeeping system in place to manage your finances and prepare for your fiscal year-end.
- If you’re incorporating your business and want to set a designated year-end, here are some factors to consider:
- Cost: Ideally, your first corporate year-end taxes should be filed as far in the future as possible to avoid incurring expenses while your business is new.
- Seasonality: Setting your fiscal year-end after your busiest period (e.g. holiday season for an e-commerce business) gives you time to review and reflect on how the business year went.
- Tax benefits: While this is not a core factor to consider, there are marginal advantages to having a business year-end in the second half of the year.
- The deadline for filing your tax return is 180 days after your designated fiscal year-end, and the deadline to pay any taxes owed is 30 days after your fiscal year ends. So if your fiscal year ends on December 31st, 2021, you need to file your taxes no later than June 30th, 2022, and pay any taxes you might owe by April 30th, 2022.