Cybersecurity for Small Businesses

In 2025, cybersecurity is a major concern for Canadian small businesses. With increasing reliance on digital tools, from cloud accounting to e-commerce platforms, protecting sensitive data is critical. Small businesses are prime targets for cyberattacks due to limited resources and weaker defenses compared to larger firms. A single breach can lead to financial losses, damaged reputations, and legal liabilities.

Per the Canadian Chamber of Commerce, “According to a survey from the Insurance Bureau of Canada (IBC), almost half (47 percent) of Canadian small businesses do not allocate any portion of their annual operating budget to cybersecurity. The same study found that 41 percent of small businesses that suffered a cyber attack reported that it cost them at least $100,000….with basic security hygiene, businesses can protect against 98% of cyber attacks.”

Start with the basics: secure your systems. Use strong, unique passwords and enable two-factor authentication (2FA) on all business accounts, including email, banking, and accounting software. Regularly update software to patch vulnerabilities; outdated systems are a hacker’s playground. For example, ensure your cloud accounting platform, like QuickBooks or Xero, is updated and configured with secure access controls.

Employee training is equally vital. Human error causes many breaches, so educate your team on recognizing phishing emails and suspicious links. In 2024, phishing attacks rose by 20% in Canada, targeting small businesses with fake invoices or login prompts. Conduct regular training sessions and simulate phishing attempts to keep staff vigilant. Impress upon your staff that it can indeed happen to you—no company is too small to be overlooked by scammers. 

Here is a short video addressing the human link in the cybersecurity chain.

Invest in reliable cybersecurity tools. A firewall, antivirus software, and encrypted backups are affordable for most small businesses. Consider a Virtual Private Network (VPN) if employees work remotely or out of town to secure data transmission. For businesses handling customer payments, ensure compliance with Payment Card Industry (PCI) standards to avoid penalties.

Data breaches can also trigger obligations under Canada’s Personal Information Protection and Electronic Documents Act (PIPEDA). If a breach risks harming customers, you must notify them and the Privacy Commissioner. Non-compliance can lead to fines or lawsuits, so maintain an incident response plan to act swiftly.

Budget constraints are real, but cybersecurity doesn’t have to break the bank. Free resources, like the Canadian Centre for Cyber Security’s guidelines, offer practical steps for small businesses. Outsourcing to a managed IT service can also be cost-effective, providing expert protection without an in-house team.

Finally, Shaw & Associates are available to help you understand tax incentives for cybersecurity investments. Certain expenses, like software subscriptions or training, may qualify as business deductions. By prioritizing cybersecurity, you safeguard your business’s future while building customer trust in a digital age

Contact Shaw & Associates Chartered Accountants for accounting help you can count on. One complimentary meeting with us will put you and your business on a more profitable and positive path.