The short answer: doing your own books can work when you have few transactions, one business bank account, and the discipline to reconcile every month. It stops working when bookkeeping happens in bursts at year-end, when you’re registered for GST/HST or running payroll, or when you’re months behind. The real cost of DIY isn’t the software. It’s missed deductions, penalties and, eventually, the clean-up bill.
When DIY bookkeeping works
- a new or small corporation with a modest number of transactions each month
- one bank account and one credit card, used only for the business
- no employees yet, and simple GST/HST filings or none at all
- software with bank feeds, such as QuickBooks Online or Xero
- a monthly habit: every account reconciled to the statement, every month
- an accountant who reviews the books at year-end and prepares the T2
If all of that describes you, keeping your own books is a reasonable choice.
What DIY bookkeeping costs when it goes wrong
- Missed input tax credits. GST/HST paid on business expenses can be claimed back, generally within four years. Expenses coded to the wrong place, or without receipts, often never are.
- A tangled shareholder loan. Personal spending through the business account, or business spending on a personal card, has to be sorted out before year-end can be done properly.
- Records that don’t hold up. CRA generally requires you to keep records and supporting documents for six years from the end of the last tax year they relate to.
- Late filings. A late T2 costs 5% of the unpaid tax plus 1% for each full month late, up to twelve months. A late GST/HST return costs 1% of the amount owing plus 0.25% a month, up to twelve months. Interest compounds daily on top of both. See our guide to late T2 penalties.
- A bigger year-end bill. When an accountant has to rebuild the books before preparing the statements, you pay for the rebuilding too.
Signs it’s time to hand it off
- you haven’t reconciled your accounts in months
- you’ve hired your first employee, which brings payroll remittances and T4 slips
- you’ve registered for GST/HST, or passed the $30,000 small-supplier threshold
- you can’t say how much the business made last month
- CRA letters are arriving, or a filing deadline has already passed
- the hours you spend on books would be worth more spent on clients
What a professional bookkeeper takes off your plate
- monthly reconciliation of every bank and credit card account
- coding transactions correctly, with receipts attached
- GST/HST returns and payroll remittances filed on schedule
- monthly or quarterly financial statements you can actually use
- a clean handoff for year-end and the T2 return
Is there a middle path?
Yes. Some owners keep entering their own transactions and have a bookkeeper reconcile and review them every month or quarter. It works as long as someone checks the books regularly, not only at year-end.
Whichever you choose, start from clean books. If you’re already a year or more behind, a catch-up brings everything current first; after that, either option is easier to keep up.
Questions to ask a bookkeeping firm
- Which software do you work in, and are you certified in it?
- How often do you reconcile, and when will I see statements?
- Who files GST/HST and payroll, and who deals with CRA for us?
- Do you also do the year-end and the T2, or do we need a separate accountant?
- What’s the monthly fee, and what’s included in it?
Our monthly bookkeeping page answers most of these, and the fee comes in your written proposal.
Sources: CRA, Where to keep your records and for how long; CRA, GST/HST penalties and interest; Income Tax Act, section 162. First published August 2023 and fully revised in September 2026. General information, not advice for your specific situation.
