Managing your accounts is an important part of running a small business. This means recording and organising transactions, preparing invoices, and filing receipts. If this is not something you have dealt with before, it can be daunting but it doesn’t have to be.
Staying on top of your accounts in an efficient and managed manner helps to make the annual accounts process much smoother.
Here are some tips to help:
Don’t wait until year end
Keep your accounts up to date as you go, even if you must hire someone to do it for you. Set aside a block of time each, day, week or month to input the relevant details. Keep all your receipts in order and include any deadlines in your business diary to ensure they are not missed. It’s important to comply with tax legislation and all the deadlines that come with it.
Keep personal and business accounts separate
When starting a small business, be sure to open a dedicated business account to ensure your personal finances stay personal and your business accounts are separate so that it is much easier for you or your Bookkeeping to manage your money.
Use accounting software
This will help to save you valuable time and reduce the chances of any inconsistency or errors. Accounting software is also a more space-saving and environmentally friendly option, as they take away the need for paper filing. Accounting software will help to keep your records more up-to-date and accurate at year end and take the pressure off all the staff, especially during the financial year’s busiest time.
Update records regularly
Piles of receipts that need inputting in one go can seem like a daunting task but keeping this up-to-date and tracking your receipts and invoices as you go will help when it comes to tackling your annual accounts. Send your invoices out as soon as you can once you finish work on a project or sell your goods. And keep track of invoices to make sure your clients pay you on time.
Reviewing your costs and suppliers every so often is good practice, and most markets are very competitive, so it’s important to research different suppliers to reduce costs if possible. If you are a growing business, it can be difficult to stay on top of your expenditure, but put time in at regular intervals to review your costs and re-evaluate your spending decisions. Closely monitoring your income and expenses is not only essential for your taxes but also for general business viability.
Ask for help
Outsourcing your accounts to an accountant can save you time and money. An accountancy firm will have experts on hand to help provide peace of mind that your accounts and compliance requirements are completed in a timely manner. They’ll also be able to advise on tax efficient ways to extract profits or reinvesting into the business.
Get in touch to see how Langricks can help to manage your accounts.