PexelsAs a small business, it can be easy to forget about your books and accounts. It’s all too easy just to focus on the actual operations of your company. For this reason, it’s very important not to wipe your business finances from your mind completely. Large companies can employ an entire finance department to keep an eye on things. But small companies don’t have this luxury. So how do you prevent things getting in a mess? Here are five steps to help you stay organised.
Check Your Finances Each Day
Make sure you are aware of what is leaving and entering your bank account each day. It might not always be possible, but you should try and get all payment decisions to pass by you first. If you are the only one in your company, make things easier for you by investing in an accounting software and intuit checks. If you are fortunate to have a finance team, tell them to give you a daily overview.
File Your Paperwork
Most of what we do these days takes place online. However, it is very important to back everything up in hard copies. Especially all of your documents and contracts relating to your bookwork and accounts. Designate a drawer in your filing cabinet for everything relating to your finances. This way, you can find papers easily whenever you need them. If you have a lot of documents, dedicate an entire filing cabinet to your money info.
Hire An Accountant
This is very important if you are a sole trader and do not have a dedicated finance department. The law requires you to file your taxes once a year. Once you have all your papers and documents sorted, pass them on to an accountant. This then ensures a second pair of eyes will be looking over everything to make sure there are no mistakes. If you file incomplete or incorrect paperwork to the taxman, you could incur a fine.
Get Into A Routine
Routines will help you keep on top of your business. This is especially important when it comes to your accounts. Your routine can start off very simple. For example, always carry out a payment run on Wednesdays. This helps you break up your week so you know what you should be prioritising each day. And, if anything ever goes wrong, you will be able to find out what happened as you can now pinpoint when it likely happened.
Save Up For Tax
Each month, put some of your profit to one side to prepare for your tax bill. No one likes to pay tax, but that doesn’t mean you can ignore it completely. You know you will get a bill once a year, so it’s best to be prepared for it. Save up throughout the year to make the payment easier. This will reduce any financial stress on you and the business. It will also save your company from slipping into the red.
Stick to these five steps, and you’ll be running a more efficient and successful business!
