Are you thinking of going self-employed as a Sole trader / partnership or setting up a business as a Limited Company? Knowing your trade is only half of running a successful business. The crucial part is the bookkeeping, keeping your accounts in order and up to date.
This is not often seen as the most exciting part of working for yourself but it’s important to keep accurate records. It’s often easier to focus on the more enjoyable aspects of your trade and running your business, but by pushing the bookkeeping to the back of your mind letting the documents pile up – well, this can really cause issues for you down the line.
Assisi Bookkeeping can help navigate you through the bookkeeping and accounts of your business.
Here are a few tips for a successful business.
Don’t leave your bookkeeping to the Last Minute.
Putting your accounts off to one side is one of the biggest mistakes a business can make. The workload quickly accumulates and you can find you don’t then have the time or energy to catch up. Don’t despair. Employ a bookkeeper for a few hours per week or month to keep your records and receipts in order, allowing you to focus on what you know best in your business. This also allows the end of year Financial Statements for your business to be quicker and cheaper to process.
Mixing business spending with personal spending.
I would always recommend a separate business bank account. While it may seem easier to use one bank account for personal and business spending, it can cost you time and money in the long run. This is because when it comes to your tax return, keeping your transactions separate helps calculate the right income and costs in your business account, ensuring you pay the correct amount of tax.
Failing to keep good records.
Whether it’s bad filing or not keeping hold of your receipts, if you don’t keep track of your expenses and cash flow you won’t know the true health of your business. You should keep and record receipts for the smallest of things, even the coffee you buy clients at a last-minute meeting!
By claiming back business expenses this helps keep your tax liability low. As HMRC may ask for evidence of your receipts, keeping good records will help you avoid any disputes.
It is wise to record and number your invoices too and make sure they’re all in sequential order. Always make sure you’re paying your bills on time.
Pay in cash
To help keep good records, pay using your card or electronic transfer. This is because your bank records the date, amount and the recipient’s name thus making it easier to trace all transactions.
Assisi Bookkeeping Ltd, offers FREE advice for both start ups and developing businesses. Contact: Tel 07963 063747 or firstname.lastname@example.org.