When you run your own business, there are countless things that you need to watch and record, at the same time as looking after your day to day business dealings. One of the most stressful parts of running your own business is keeping your books up to date and accurate. This takes time away from other parts of their business and they are leaving money on the table as a result. This is one of the reasons many business owners decide to outsource their bookkeeping to a trusted company such as the folks at www.bookkeeperco.com.au.
If you still wish to track and record all of your transactions yourself, there are a number of different tools and methods that will help you to streamline the process and save some time along the way. When tax season arrives, the last thing you want to happen is to be completely unorganised and be stressing about all of the different transactions throughout the quarter or the year. Keeping accurate books at all times will also allow you to more accurately plan ahead. Here are some tips that will help you with the bookkeeping process.
Make sure that you plan ahead for future expenses
When you fail to plan in advance for future expenses, you may be left short of cash flow to completely cover the payments. This may result in you having to take out a short term loan or squeeze by for a certain period of time. However if you plan out these expenses well in advance you will be able to set aside the money needed to make the payments for when it is needed. You should not only look one year in advance, you should look well into the future, up to five years in advance. It is inevitable that you will have to change your equipment at some stage, so having plenty of notice will allow you enough time to set aside the money and research what the best alternative options are for you and your business.
Accurately track all of your expenses
The last thing you want to do is leave money on the table and not take advantage of all of the tax breaks that you can. One of the easiest ways in which to track expenses is to have a specific account or credit card that is dedicated to business expenses. This makes it extremely easy at the end of the tax year to determine what your total business expense write offs will be. As it is paperless, you won’t have to worry about keeping track of receipts and documentation. It is also a good idea to take a note of each transaction with a pen and paper at the time as this will help you to be able to substantiate each of the expenses if you have an audit. Make sure that you always take details into account, if you write down round numbers for things such as mileage; this can point out as discrepancies for the tax man.