How to Create a Simple Cash Flow Forecast for Your Small Business in Canada
Wondering how much money your business will really have next month?
It’s easy to look at your bank balance and assume everything is fine. But without a proper cash flow forecast, you might be flying blind.
Whether you’re a freelancer, real estate professional, or startup founder in Canada, understanding your cash flow is key to:
Avoiding surprise shortfalls
Making smarter spending decisions
Preparing for tax time or slow seasons
Knowing when you can invest in growth
The good news? You don’t need complicated software or a finance degree to do it.
✅ What is a Cash Flow Forecast?
A cash flow forecast estimates how much cash your business will receive and spend over a period, usually monthly or quarterly. It helps you predict whether you’ll have a surplus or a shortfall, and gives you time to adjust before it becomes a problem.
🧮 Step-by-Step: How to Create a Simple Cash Flow Forecast
Step 1: Choose Your Timeframe
Start with a 3-month forecast, then build up to 6 or 12 months as you get comfortable.
Step 2: Estimate Your Incoming Cash
Add up all the money you expect to receive, including:
Client payments
Online sales or service fees
Rental income (if applicable)
Tax refunds or grants
Be realistic—only include what you’re confident you’ll collect.
Step 3: List All Your Expected Outflows
Break this into fixed and variable expenses:
🔹 Fixed Expenses
These stay the same each month and are easy to predict:
Office rent or coworking fees
Accounting or bookkeeping services
Software subscriptions (e.g. Xero, Hubdoc, Canva)
Insurance (business, liability)
Internet and phone bills
Loan repayments
🔹 Variable Expenses
These change from month to month depending on your business activity:
Contractor or employee payments
Supplies and materials
Travel or client meeting costs
Marketing and advertising (e.g. social media ads)
Meals and entertainment (if client-related)
Equipment purchases or repairs
GST/HST remittances to the CRA
Step 4: Calculate Net Cash Flow
Incoming – Outgoing = Net Cash Flow
Do this for each month.
📌 If it’s negative, you’ll need to find ways to delay expenses, increase income, or dip into savings.
📌 If it’s positive, plan how to reinvest it wisely (pay yourself, save for taxes, or scale).
Step 5: Use a Simple Template (or Let Us Do It for You)
You don’t need fancy software—we’ve built a customizable Excel template that does all of this for you.
✔️ Auto-calculates monthly surplus/deficit
✔️ Color-coded alerts
✔️ CRA-ready formatting
You can:
Do it yourself
Or send it back to us—we’ll review, refine, and explain your numbers
📩 Request the free template or a custom forecast at Help@falconsightaccountinginc.ca
💡 Bonus: What Can You Do with a Cash Flow Forecast?
Plan for big purchases (e.g. new laptop, camera, inventory)
Prepare for seasonal slowdowns
Confidently hire help or take on bigger projects
Show lenders or grant providers you’re financially organized
🛟 Need Help Creating or Understanding Your Forecast?
At FalconSight Accounting Inc., we help Canadian freelancers, startups, and service-based business owners:
Build simple, realistic forecasts
Create custom budgets based on actual income patterns
Catch up on books and plan for the future
All virtual. All flat-rate. All in plain English.
📞 Book a free consult or grab the forecast template here:
👉 falconsightaccountinginc.ca