Need a hand?

Find what you need on the FreshBooks Support page. From Client tips to Invoice tricks and everything in between.

Rather speak to a human? Give our award-winning Support team a shout:

Support Team
< Reports

How can I prepare my taxes faster?

What exactly do you need to know before filing your taxes? Whether you’re working with an accountant or doing it on your own, FreshBooks has information to help you during this stressful time. Consider this guide your tax handbook, everything that you need from deadlines and forms.

Table of Contents:

Working with FreshBooks:
I) What do you need?
II) Which Reports should I use?
III) Should I use accrual or cash based Reports?
IV) What if I have been paying taxes throughout the year?

Other Tax Resources
V) Where can I get my tax forms?
VI) Can I file online?
VII) What are the tax deadlines
VIII) Other questions or looking for a tax professional?


Working with FreshBooks

I) What do you need?

Generally, there are two major questions you will have to answer while preparing your tax return:

  • How much money have I brought in?
  • How much money have I spent?
You’ll be asked to break down the money into your revenue as well as into the amount of sales tax you have collected (if applicable).

For your Expenses you will be asked to break them out into tax categories. Luckily FreshBooks follows these same categories (yay!), so your Expenses should be ready to go.


II) Which Reports should I use?

If you are filing with an accountant, the easiest way is to work with them is to give them access to your Journal Entries. These pages will have all the information your accountant needs to help you file.

To give your accountant access to your Journal Entries, head to the Reports tab within your FreshBooks account. In the top-right corner of your Reports page, you will see a button to invite your accountant. Inviting your accountant will give them the ability to access certain Reports as well as your Journal Entries.

If you’re gathering the data yourself, or if your accountant wants other reports, the Profit & Loss Report is an great choice – it gives you a break down of the money you earned, what your cost of goods sold was, and what your Expenses in each category were. This will answer both questions in one fell swoop – how much money did you bring in, as well as how much money did you spend.

If you’d like more details about the money you have made, you can run the Payments Collected Report. This will give you a list of all payments you’ve received (or entered yourself). Think of this report as pulling all information from the ‘Payments’ sub-tab from within your FreshBooks account.

If you’re looking for more details about the money you’ve spent, the Expense Report will help you out. Please note that your tax data will only appear after you’ve exported the Expense Report to Excel.

Keep in mind that these Reports don’t take sales tax into account, so you may also need to run a Tax Summary Report so you’re not overstating anything. All of these reports can be found under the “Accounting Reports” section of your Reports tab.


III) Should I be using accrual (billed) or cash (collected) methods of reporting?

Some of your FreshBooks Reports will give you the option to run the report in either the Accrual (Billed) or Cash (Collected) methods. The accrual method looks at the date of the invoice itself, whereas the cash method looks at the date of the payment.

In the US, small businesses are given the choice between the two methods, with the majority of non-inventory based businesses opting to use the cash method. Please note that once you choose to file using one method of accounting, you have to continue to use that method until you get approval from the IRS to switch.

In Canada you’re required to use the accrual (billed) method of accounting.


IV) What if I have been paying taxes throughout the year?

If you have been paying estimated taxes in instalments throughout the year you will need to know how much you have already paid.

If those have been recorded within FreshBooks, they will have been listed as an Expense. Check your Expense Report to see how much you’ve already paid. That way, if you end up owing taxes, you will only have to pay the difference between what you owe and what you have already paid.


Other Tax Resources

V) Where do I get my tax forms?

Depending on your location and your business type, you can download your tax forms from one of the following links:

United States Sole Proprietorships
US Corporations
Canadian Sole Proprietorships
Canadian Corporations


VI) Can I file online?


In the US there are a variety of different services that will allow you to file online. Depending on which forms you’re filing, the IRS as a list of recommendations.

In Canada the CRA allows you to file online. If you’re a sole proprietor, or simply need to file your personal tax return, then we recommend using SimpleTax and UFile as programs to help you easily prepare and submit your return.


VII) What are the tax deadlines?

US – March 15 for Corporate Returns
US – April 18 for Individual Returns
Canada – April 30 (or next business day if 30th falls on a weekend) for individual returns if you have money owing
Canada – June 15 for self-employed returns if you do not have money owing

VIII) Other questions or looking for a tax professional?

Taxes can be tricky. If you have any questions specific to your business or your industry it never hurts to chat with either your local government tax office or a tax professional in your area. Find some helpful people using the links below:
Local Accountants
IRS Contact Info
CRA Contact Info

If you still have questions about Tax time, or need a hand with anything else, give our award-winning Support team a shout:
Phone: 1-866-303-6061