7th March, 2019
Maybe you got into a trade because you enjoy working with your hands, but at some stage you’ll have to get around a bit of small business bookkeeping.
The thought of having to handle book work at the end of a long week on a construction site or after installing lights, digging up pipes, painting houses and the like can be enough to make you want to pull your hair out.
Unfortunately, if you want to stay in business and keep the tax office (and others) off your back, it’s something that has to be done.
To keep your finances and paperwork properly in order, and to have them eventually take you less time because you’re organised, it’s important to put a few healthy bookkeeping habits in place.
Here are some bookkeeping basics you should work on sooner rather than later.
Work with your accountant, and remember that they can help you and aren’t just an annoying expense!
Discuss with your advisor the types of forms, reports and other documents which need to be completed, and when they’re required, so you’re clear on your responsibilities.
Having this kind of chat will also ensure your accountant doesn’t have to chase you up constantly for things. In turn, you’ll save time and money.
Speak with your accountant about some systems you can put in place to make things go more smoothly. They’re sure to have helpful suggestions.
Having said that, it’s also vital to not just outsource all of your financial and related admin work to an accountant and/or bookkeeper and then think no more about it.
Stay involved to at least a minimal extent so that you always know what’s going on in your business and if there are any potential cashflow or legal issues to worry about.
Keeping an eye on the work of the people you hire will also help to keep them honest.
With paperwork collecting so quickly when you run a business, it’s tempting to throw out as many pages as you can. However, don’t be too carefree about this.
There are many documents you must keep on file for numerous years in case you are audited by the tax department.
You may also want to go back over financial paperwork to remind yourself of details or to learn what has gone right and wrong over the years.
Do your best to organise paperwork, too. Simple, affordable folders broken up with dividers for different areas can work wonders.
Alternatively, take scans or photographs of documents and then upload them to the cloud. This way, you’ll always have them available and safely stored, yet don’t have to worry about the documents taking up room in your home or office.
Just like in every other aspect of your work, a key bookkeeping habit to get into is being consistent.
You will make life much easier for yourself if you update paperwork at least once a week or fortnight.
Doing so will ensure things don’t get out of hand and unmanageable.
It also means that if there are any issues you’ll spot them quickly and will be able to address them right away.
These days, thanks to advances in the computer arena, there is all sorts of wonderful tech you can use to make your bookkeeping go more smoothly.
In particular, all trades and construction workers should sign up for access to trusted online accounting software.
Solutions such as those offered by MYOB have features like inbuilt receipt scanning and document management which make it a cinch to handle expenses and receivables.
This kind of software can also be set up to automatically send detailed reports and other information straight to your bookkeeper or tax agent (meaning less heavy lifting on your end).
UPDATE: You can now lodge your BAS right from MYOB Essentials (Australia). If you’re using this product, you can see the exact process to get your BAS done in a flash, here.
Do make sure to double check your work for accuracy though, even when using tech, as human error can occur if you input details incorrectly.
Utilise your software to run reports each week and that way you’ll pick up on errors you may have missed at the time.