Finish the year strong with these tax-saving tips

December often arrives like a freight train — full of holiday plans, last-minute deadlines and that nagging feeling you’ve forgotten something. It’s also one of the best times of the year to pause, take stock of your finances and set yourself up for a smoother, more profitable tax season.

1. Get your financial records in shape

Before you start making decisions, make sure your books actually reflect reality. Accurate records are the foundation for smart tax planning — and they save you time, stress and money when filing.

Spend an hour or afternoon gathering:

• Receipts
• Invoices
• Bank and credit card statements
• Mileage logs
• Equipment or software purchase records

If you use cloud bookkeeping, reconcile everything up to the end of November so you’re working with good data.

2. Defer a loan payment

This tip surprises a lot of business owners: deferring a loan payment can give you extra cash during one of the most expensive months of the year.

Some banks offer a one-month “skip” on payments — you’ll see programs like TD’s “Payment Pause” or RBC's “Skip-A-Payment.”  You won’t get out of paying the interest; it’s added to your principal. But if you need temporary breathing room to manage year-end payroll, inventory or holiday expenses, it can be a smart move.

Before you decide, consider:

• Will the interest cost be worth the short-term cash boost?
• Will this put you in a better position to close out the year smoothly?

If the answer is yes, give your lender a quick call.

3. Take advantage of medical expense deductions

If your family’s medical expenses exceed $2,759 (or 3% of your net income, whichever is less), you can claim the amount above that threshold. Many people forget just how many everyday health expenses qualify.

This is the perfect time to:

• Refill prescriptions
• Replace glasses or contacts
• Visit your chiropractor, dentist or physiotherapist
• Purchase eligible health products (including medical cannabis)

If you’re close to the threshold, a few year-end appointments could push you past it and increase your deduction.

And keep those receipts. Here's a list of 17 critical documents to keep safe for tax time.

4. Use your health spending account (HSA) before it expires

If you’re lucky enough to have an HSA through your business, check your balance. Most plans reset on December 31, and unused funds don’t roll over.

Book your massage, grab those orthotics, get that dental work done — whatever you’ve been putting off. It’s free money (and a tax-efficient benefit) that you don’t want to leave on the table.

5. Review your investments strategically

Before the year wraps, take a moment to look at your investments — both personally and inside your corporation.

A few tax-smart moves to consider:

• Tax-loss selling: If you’ve had capital gains this year, selling underperforming investments at a loss can offset those gains.
• Crystallizing gains inside a corporation: Selling shares can move half the gain into your Capital Dividend Account, letting you pay yourself a tax-free dividend.

Investment decisions can get complicated fast, so this is one area where professional advice pays for itself.

6. Make charitable donations before Dec. 31 

If you’re planning to donate this year, do it before the year ends to claim the credit on your 2025 return.

Here’s what most people don’t realize:

• The first $200 of donations gets you a 15% federal credit.
• Anything beyond $200 earns a 29% credit — a significant bump.
• You can carry donation receipts forward for up to five years, which is handy if you want to group smaller donations for a bigger credit down the road.

And if you want help choosing the right charity for your values and goals, check out our blog Donating Responsibly.

7. Review bonuses, dividends and family compensation

If you’re a small business owner, you control how and when you pay yourself — which means you also have opportunities to optimize your tax position.

Here are a few questions to ask:

• Would paying yourself a bonus or dividend before December 31 lower your overall tax this year?
• Is your income going up or down next year — and does that change your strategy?
• Are you paying family members? If so, watch out for Tax on Split Income (TOSI) rules. These can hit hard if ignored.

We break down the details of Income Sprinkling in our blog. If you’re unsure, always ask before issuing payments — it’s a lot easier to plan than to fix.

8. Make year-end purchases for your business

If your business has a December 31 year-end, you still have time to claim certain purchases this year.

Think about:

• Computers and tech
• Tools and equipment
• Office upgrades
• Software subscriptions
• Larger one-time expenses you’ve been putting off

If the purchase is necessary and will help you run or grow the business — and you have the cash flow — buying before year-end can increase your deductions.

A good rule of thumb: Don’t buy something just for the write-off. But if you need it anyway? Year-end can be a great time.

9. Set your financial plan for the year 

Once you’ve wrapped up this year’s tasks, take a moment to look ahead.

Think about:

• Your 2026 revenue and profit goals
• How much you want to pay yourself
• Whether you need to adjust pricing or payroll
• Any new tools, contractors or hires you’ll need
• Big purchases coming down the pipeline
• Ways to smooth out cash flow and keep surprises to a minimum

A simple annual plan can make a huge difference — especially if tax season tends to sneak up on you.

10. Consult a tax professional

The end of the year is your last chance to make changes that actually affect your tax bill. Once January hits, many options disappear — so this is the ideal time to check in with your accountant.

At True North, we help small business owners all year long, but year-end is where we really shine. Whether you need help with bookkeeping catch-up, GST filing, payroll or tax services, our team of CPAs is here to make the complex stuff feel simple.

📍 Serving Okotoks, Calgary and beyond
Ready to get ahead of tax season? Reach out — we’re here to help.

If you want even more practical advice, explore our blogs on Corporate Tax and Personal Tax for clear, friendly, small-business-focused guidance.

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