Are you running a small business? Did you know that there are 99.9% of small businesses in the United States? If so, you know how difficult it is to stay organized and keep track of your business expenses.
If you own a small business and are looking to keep your expenses low in the weeks to come, you need to understand how to track your business expenses accurately.
Fortunately, there are easy ways to manage your business finances and get your deductions in on time.
Read on to learn how to stay organized!
1. Setting Up a Recordkeeping System
A few tips for keeping track of business expenses include setting up a separate business checking account, creating a budget and tracking income and expenses, and noting when business deductions can be taken. Use a spreadsheet to record income, expenses, and other transactions to help you stay organized.
Get all of your financial documents in order, including invoices, receipts, tax information, etc., and file them away for easy access. If you are a small business owner, it may be helpful to refer to a small employers relief guide to ensure you are properly recording and filing your financial documents. Finally, set up a separate folder for tax purposes and store all relevant documents in it. This will ensure you have all of the records you need in one place and make filing taxes easier.
2. Tracking Inventory Purchases
Tracking inventory purchases is an essential piece of budgeting for small businesses in order to prevent financial losses. To keep track of business expenses associated with inventory purchases, it is important to have an inventory ledger that details each purchase.
The ledger should include the supplier’s name, item description, stock quantity, cost, purchase date, and any other relevant information. Additionally, it is important to review inventory purchase invoices and receipts to ensure accurate data entry and prevent any issues with incorrect pricing or billing.
3. Hire A Bookkeeper
Small businesses should consider a bookkeeper to help keep track of their business expenses. Bookkeepers are trained to document transactions, reconcile accounts, and analyze their financial data. They can look into expense trends and allocate the budget towards investing in the right areas of the business.
Additionally, a professional bookkeeper can help the business develop financial strategies such as setting goals and creating realistic budgets. With a bookkeeper on-call, small businesses can easily stay on top of their finances when it comes to bills, payroll, and other business expenses.
Take the time to hire a bookkeeper, and make sure to keep track of expenses to ensure your business’s stability.
4. Integrating Business Credit Cards
Having a business credit card is a great way for small business to track their expenses since they are usually integrated with accounting software. This integration allows expenses to be tracked, categorized, and stored in the company’s accounts, making it easier to manage the expense budget.
Some tips for small businesses using business credit cards to keep track of their expenses include: always paying full balances on time to avoid fees and interest, setting up an expense tracking system in the accounting software, properly categorizing all expenses for better reporting, and reviewing monthly statements to catch any mistakes.
Take Control Of Your Business Expenses
Using one of the tools discussed in this article, small business owners can now easily keep track of their business expenses and move forward with confidence. Whether you choose to go for a simple spreadsheet or a more robust app, there are plenty of options to choose from. So what’s better than being organized and saving money? Get started today!
Ready for an intuitive, easy-to-use daily expense tracking app? Check out our blog for more great tips.