Why are my revenues recorded according to the billing date and not the payment date?

Why are my revenues recorded according to the billing date and not the payment date?

In the vast majority of cases, your accounting method will require revenue to be recognized according to the date on which the service is rendered and not according to the date of payment. This is known as accrual accounting. 

According to the Canada Revenue Agency (https://www.canada.ca/en/revenue-agency/services/tax/businesses/small-businesses-self-employed-income/business-income-tax-reporting/accounting-your-earnings.html): Generally, you have to report business income using the accrual method of accounting. Farmers, fishers, and self-employed commission agents can use the cash method or the accrual method to report income, but not a combination of both... Under the accrual method, you have to report income in the fiscal period you earn it, no matter when you receive it. You can deduct allowable expenses in the fiscal period you incur them, whether or not you pay for them in that period. Incur usually means you paid or will have to pay the expense.

    • Related Articles

    • How do I edit my billing address?

      You can change your billing address by creating a new invoice in a client record and editing the information in the field located at the upper right corner of the invoice. However, this information must be edited manually when each invoice is ...

    • What payment methods can be used to pay an invoice?

      The following payment methods are accepted:

    • How to bill a guardian?

      When you create a record for a minor, you have the option to add one or two guardians. You can also add them later by editing the minor's profile. When creating the invoice, select the name of the guardian. The name of the payer will be indicated on ...

    • Is it possible to manage the third-party payers?

      Absolutely! Visit https://admin.psylio.com/organization/institutions to customize the third-party payers you do business with. Then, when you create a record, you can indicate in the client profile whether it is associated with a third-party payer. ...

    • Is it possible to do monthly billing?

      Yes, you can include several services on the same invoice.