Closing out your books at year end doesn’t have to be stressful. Year-end bookkeeping checklist helps small and medium-sized businesses stay on track as the year comes to a close. This checklist is designed to keep your records organized, make sure everything is accurate, and help you stay compliant with tax rules. With proper year-end bookkeeping, you can reduce surprises, understand your numbers better, and feel confident going into the new tax season.
1. Reconcile All Bank & Credit Card Accounts
- Match each bank and credit card statement to your bookkeeping records
- Investigate and fix discrepancies (missing, duplicated, or mis-categorized transactions)
- Ensure ending balances match your December 31 statements
Why it matters: Reconciled accounts are the foundation of accurate financial reports.
2. Review Income & Expense Categories
- Confirm income is recorded in the correct accounts
- Review expenses for misclassifications (e.g., meals vs. office expenses)
- Ensure personal expenses are removed or properly recorded as owner draws
Tip: Clean categories = better tax deductions and clearer reporting.
3. Check Accounts Receivable (Who Owes You Money)
- Review outstanding customer invoices
- Write off uncollectible amounts if necessary
- Confirm payments received near year end are recorded in the correct period
4. Check Accounts Payable (Who You Owe)
- Ensure all vendor bills are entered
- Record outstanding expenses (utilities, rent, subscriptions, contractors)
- Confirm bills paid in January for December expenses are properly accrued
5. Review Payroll & Contractor Payments
- Confirm payroll totals match your payroll reports
- Ensure remittances are up to date
- Verify contractor payments are accurate and properly categorized
This step is especially important before issuing year-end tax slips.
6. Verify Sales Tax (GST/HST or PST)
- Reconcile sales tax collected vs. paid
- Ensure filings match your bookkeeping records
- Confirm no sales tax is included in income or expenses incorrectly
Mistakes here can lead to penalties or overpayments with the Canada Revenue Agency.
7. Review Fixed Assets & Depreciation
- Identify large purchases (equipment, vehicles, computers)
- Ensure assets are recorded properly—not expensed incorrectly
- Prepare asset information for your accountant to calculate depreciation
8. Review Owner Transactions
- Confirm owner draws, contributions, and loan payments are accurate
- Separate business and personal activity clearly
- Ensure balances make sense going into the new year
9. Run Year-End Financial Reports
Generate and review:
- Profit & Loss Statement
- Balance Sheet
- General Ledger
Look for:
- Unusual balances
- Negative or unexpected accounts
- Big changes from prior years
10. Back Up & Lock Your Books
- Save digital copies of reports and records
- Back up your accounting file securely
- Lock the year (if using accounting software) to prevent accidental changes
11. Prepare for Your Accountant
Have these ready:
- Financial statements
- Bank and credit card statements
- Payroll summaries
- Sales tax reports
- Asset lists
This saves time—and money—on accounting and tax prep.
A Bright Finish to the Year
Year-end bookkeeping isn’t just about closing the books—it’s about opening the door to a stronger, more confident year ahead. It’s about starting the new year with confidence, clarity, and control.
If this list feels like more than you want to manage alone, that’s exactly why we’re here.
Britehouse Bookkeeping brings clarity, consistency, and calm to your finances—so you can keep moving forward.
Here is a downloadable PDF version for your convenience:
Download Monthly Bookkeeping Checklist
Final Thought
Once your books are clean, your financial reports become much easier to understand. Accurate records help you see where your money is coming from and where it’s going. You can spot trends, catch problems early, and make better decisions for your business. If you’re not sure what your numbers are actually telling you, read our post on what your financial reports are really telling you to gain clarity and confidence in your financial data.