For every business, even those who employ a professional bookkeeping service it’s important to understand the basics. For many small businesses and start-ups bookkeeping can be a daunting process. However, if you’re struggling to balance your books every month, or are mystified by how bookkeeping works, then follow these straightforward tips to get your finances in tip-top shape and set your business up for success.
Keep your personal and business finances separate
Maintaining a boundary between your personal and business spending and finances is essential. Mixing the two can get messy and complicated; if you don’t already have separate bank accounts then do so as soon as possible. With separate accounts it will be much easier to keep on top of your cash flow and to gauge your income and monitor your expenses and will make financial reporting simpler. Most importantly of all when you have to fill in your tax return you’re less likely to overpay the amount of tax for your business.
Keep hold of everything
Make sure you keep hold of all receipts, invoices, documents and records of expenditure. One way of avoiding any problems is to have a good filing system and make sure that nothing gets thrown away. Make sure you have records of all bank and credit card statements, profit and loss statements, balance sheets, receipts and invoices for sales and services rendered by the business.
Employees should attach copies of receipts to their expenses claims. Records should be kept by law for six years in case you have to refer back for tax purposes so it’s worth investing in a good filing system and get in the habit of hoarding financial paperwork now to prevent any problems later down the line.
Make it a date
Consistency is key when it comes to bookkeeping. Set a date and a time every week or at least every month for a few hours to get your records in order. Maintaining your financial paperwork on a regular basis is key to keeping your accounts organised and reduced the chance of records being lost.
By raising sales invoices as soon as possible any problems are likely to be picked up on sooner which means you have more time to remedy any potential issues. Going over your accounts on a regular basis also means you have a better knowledge of your financial situation. However, if you are finding the time commitment too demanding there are many expert bookkeeping services which can save you time and hassle in doing this for you.
Remember there are experts in the field of managing accounts who have the skills and experience to ensure this important part of your business is maintained correctly. By outsourcing your bookkeeping, you will free up your time to focus on running your business and you could benefit even further by asking for regular management accounts information to help you do that more effectively and with accurate information to hand. At the very least using the services of a professional bookkeeper should help reduce the cost of getting your year-end accounts produced.
Plan for the future
It’s easy to forget when you’re caught up in the day-to-day work of running your business but it’s important to set up prepare for future expenditure such as VAT and other tax payments. If you can try and set aside funds perhaps in a separate bank account, so that when it comes to pay those bills the is money available and there’s no need to panic.
Hire a Professional Bookkeeping Service
If you’re finding it a slog to stay on top of all your financial paperwork there are trained professionals who are here to help you ensure this vital aspect of your business is taken care of.
Outsourcing your bookkeeping not only frees up your time to focus on your business, many people also benefit from regular management accounts updates to help you make business decisions. Not only will it save you money but using a professional bookkeeping service should help reduce the cost of getting your year-end accounts produced.
If you’re looking for a reliable bookkeeping service in London look no further than BNA Consulting. We offer flexible, off-site solutions for all your bookkeeping needs whether you need a long- or short-term solution we are here to help your business grow.