Small Business Bookkeeping Tips

Author

By Tim Rose - Owner of The People's Bookkeeper

We all have our struggles in our businesses. When you're trying to do everything yourself, it can get messy. That's why it's essential to find yourself a great bookkeeper. Having a great bookkeeper can make your financials flow much smoother, thus leaving you to focus on your passion - your business. Here are some great tips for you as a small business owner that can help take your company to the next level.

• Go Virtual - There was a time when it was all paper and no apps or cloud. The whole industry has changed rapidly, and now it's a much wiser choice to take everything virtual. An in-house bookkeeper can cost you anywhere between $40,000 to $60,000 per year, and throw in insurance, bonuses, premiums and taxes, and the bill can run even higher. A virtual bookkeeper can do all the heavy lifting for you out of their own space, and cost you a fraction of the amount. Many provide the same services you would expect from your in-house bookkeeper, but for a much smaller price tag. Why not go virtual when you can take all those extra savings and put them back into your business and grow faster?
  

• Keep Yourself Organized - Ensure that you work closely with your bookkeeper and your CPA by getting them everything they need in a timely fashion. That means develop a system that works for you, and actively manage all your tasks week by week. Each month pay attention to what your bookkeeper is sharing with you regarding your financial statements. Your bookkeeper should be going over your financial statements with you in detail. I do this with my clients so that they understand exactly what is happening in their business and where their money is coming from and going to.
  

• Keep Personal & Business Separate - Do not mix business with personal. You don't want to cause problems for your company and have a tax auditor come down on you, it's not a fun process. Don't use your business credit card for personal purchases, and vice versa. Also make sure you pay yourself first, and then run the business on your remaining cash.
  

• Always Keep Your Receipts - I can't stress this enough, you must always keep your receipts. One of the beautiful things with a virtual bookkeeper taking care of your business financials, is that apps like Hubdoc can make it super simple to get the receipts to your bookkeeper. You can use their app and snap a quick picture, then send it right to Hubdoc. Your bookkeeper can then go in and take care of properly filing everything for you. Your most important job is to make sure you don't lose the receipt. Keep them all coded and organized safely in your filing cabinet.
  

• Make Sure You Don't Forget Tax - Depending on your business revenue, you will want to take out anywhere between 15-35% and put it in a separate account. One great option is Tangerine. They make it very easy to move money back and forth between accounts, and then the money is there when tax time comes. You also want to make sure you file all your tax reports on time so that you avoid having to pay any penalties.
  

As you can see, there are a lot of things to think about when you're a small business owner. These are just some of my best tips to help you out as you are growing your company. You want to make sure that your business is running on enough cash flow so that things don't get too tight. If your cash flow isn't where you want it to be, then you'll need to consider cutting expenses and managing your cash flow in different ways. A great virtual bookkeeper is going to be able to help you with this each month.