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posted Oct 31, 2019 6:29:03 AM

Can I change my Accounting Method from "accrual" to "cash" on my T2125 Statement of Business?

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1 Replies
Level 6
Oct 31, 2019 6:29:04 AM

Hi thank you for using Intuit TurboTax AnswerXChange

The Canada Revenue Agency (CRA) guidance states "If you decide to change your method of reporting income from the accrual method to the cash method, use the cash method when you file your next income tax return. Make sure you include a statement that shows each adjustment made to your income and expenses because of the difference in methods."

For more information related to your scenario, you can contact CRA and/or review the following link:

https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/sole-proprietorships-partnerships/accounting-methods.html

Hope this helps