5 Common Bookkeeping Mistakes Small Businesses Make (and How to Avoid Them)

Running a small business means wearing a lot of hats — and for many owners, bookkeeping ends up at the bottom of the list. Unfortunately, small mistakes in your books can snowball into bigger problems like missed deductions, inaccurate reports, and even CRA penalties.

Here are five of the most common bookkeeping mistakes we see — and how you can avoid them.

1. Mixing Personal and Business Finances

When business and personal expenses get tangled in the same account, it’s harder to track spending, claim deductions, or provide clear records to your accountant.

Avoid it: Open a dedicated business bank account and use it for all business transactions. Keep a separate credit card for business expenses only.

2. Not Reconciling Bank Accounts Regularly

Skipping reconciliations means you might miss bank errors, duplicate transactions, or missing deposits. These can create big headaches later.

Avoid it: Reconcile your bank and credit card accounts at least once a month to ensure your records match your statements.

3. Forgetting to Track Small Expenses

Those coffee meetings, parking receipts, and office supplies add up. If you’re not tracking them, you’re missing out on valuable deductions.

Avoid it: Save every receipt and record expenses as they happen. Cloud-based tools like QuickBooks make it easy to snap photos and log them instantly.

4. Waiting Until Year-End to Update Your Books

Leaving all your bookkeeping until tax season leads to rushed work, missing documents, and costly errors.

Avoid it: Set aside time each week or month to update your records. This keeps your financial picture clear and helps you make informed business decisions year-round.

5. Not Backing Up Your Financial Data

A crashed computer or lost file can set you back months if your records aren’t saved elsewhere.

Avoid it: Use secure, cloud-based bookkeeping software or set up automatic backups to protect your data.

The Bottom Line

Good bookkeeping isn’t just about staying compliant — it’s about having a clear picture of your business health so you can grow with confidence.

If bookkeeping is taking too much of your time or you’re worried about making mistakes, Signature Bookkeeping can help. We’ll keep your records organized, accurate, and up-to-date so you can focus on running your business.

Ready to get your books in order? Contact us today to get started.