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10 of the Top Small Business Accounting Tips & Tricks.

2/12/2019

6 Comments

 
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Having an accountant on your in-house team is ideal, but obviously, not all small businesses can afford to have one. If this is the case, you can do it yourself, hire a part-time bookkeeper or maybe even utilise some of the employees you may already have to do the accounting tasks. Whichever way you go, you must find a simple record keeping system for your small business.

Here are our top tips for accounting for a new or small business...
  1. ​Keep things separate: It’s important to keep your personal and business finances separate to keep things straight when it comes to tax time. Don’t confuse yourself more by trying to mix the two. Have separate bank accounts, not necessarily a business account, just separate. 
  2. Update regularly: Make sure you keep thorough records of business transactions and receipts as you go. Ideally each month. Balance the books right away. Don’t wait for several transactions to occur and then decide to balance them. Some business owners put it off and then the task seems insurmountable.
  3. Download an accounting app or subscribe to an online accounting package: There are plenty of low-cost accounting apps around nowadays that allow you to take photographs of your receipts and send invoices on the go. When your accounting year ends this will save you hours or even days of spending time shuffling through scraps of paper in a shoebox. There are numerous apps and software out there to choose from and they can keep track of all your information in one place. In most cases, all you would need to do is type in the necessary information and it does the calculating for you. Most accountants use these anyway, so why not do it yourself?
  4. Be sure to check your financial statements often to determine where you’re spending too much or too little. You may discover if there are ways to cut costs in your small business or if there are ways to budget for some extra marketing or stock. Plan time in your diary to do this each month. Don’t wait until the end of the financial year to do this as it’s then too late to do much about it. 
  5.  Always keep up to date on the new tax laws and regulations. Don’t wait until tax time to check them out. There may be something you can use now that would help you save money when it’s time to prepare your accounts. 
  6.  Research all the possible tax deductions you can use in your business. Some items are deductible in full, while others take depreciation into account. Also, the tax strategy will be different for small businesses operating out of the home versus brick and mortar businesses that are independent from the household so get advice if you are not sure. The HMRC often offer free webinars. 
  7. Keep a cash flow forecast. Most accounting software or apps will allow you to do this based on your current incomings and outgoings. This will enable you to make educated financial decisions rather than hoping for the best. 
  8.  Keep on top of your debtors. Know who owes you money and have a plan in place to recover what you are owed. Be clear on your terms when they first become a client. Make it easy for your clients to pay you and give them regular reminders if they are late. You can download standard debt collection letters templates online if needed plus many apps will enable you to set up automatic reminders to chase debts. 
  9. Make a note of any tax deadlines in your diary, ideally a month or two ahead so you have time to prepare them. Late filing of accounts can often result in fines. Plan for any taxes due in your cashflow document. 
  10. Remember the VAT is not your overdraft! Keep any taxes dues in a separate account so you are not tempted to use them as a buffer. 

Happy accounting!  
6 Comments
James David link
19/8/2020 04:45:07 am

Thank you for sharing this article, I`m very appreciative and thankful to read thank you. Keep sharing.

Reply
Peter link
19/8/2020 04:46:28 am

Thank you for sharing this article, very helpful and amazing . Keep sharing.

Reply
Francis link
19/8/2020 03:45:53 pm

Great 10 tips you have here! Very informative.

Reply
Bob link
18/12/2020 03:18:55 am

I like your accounting tips. I need help with my 1099. I'll have to get a CPA.

Reply
Shamy Yu link
20/4/2021 09:38:47 am

Thank you for the well-explained information. It’s beneficial that there are articles like this to help handle it. Keep sharing :) Instantly Share Your Information https://blue.social/business-cards/blue-smart-card/

Reply
John Carston link
9/9/2022 04:10:15 am

I'm glad that you talked that business and personal things should be separated to prevent misunderstandings. Yesterday, my best friend mentioned that he was looking for a reliable CPA that could assist with his tax planning for his future business plans, and he asked if I had any idea what would be the best option. I love this instructive article, I'll tell him that it will be much better if he consults a trusted CPA
firm as they can provide details about their planning.

Reply



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