As any entrepreneur would tell you, seek help from professionals offering bookkeeping for small businesses. This will ensure your business remains financially healthy.
Bookkeeping and accounting generally include complicated tasks like tracking financial transactions, keeping records of expenses and income, and complying with tax regulations. To understand these things, you need to do a lot of reading.
This article shares the best practices for organising finances, utilising accounting software, and streamlining bookkeeping processes. Read on.
Tip #1: Organise Your Finances
One thing you must never forget when it comes to small business bookkeeping is keeping your personal and business finances separate.
Having a separate bank account helps you keep track of your business expenses. This enables you to monitor cash flow and avoid any tax confusion. Keeping it separate from your personal account also makes it easier to track transactions and fix any inconsistencies.
Setting up a separate bank account is just one thing. You should also have a filing system for receipts and invoices. This helps you record your expenses and you claim all the tax deductions you are entitled to.
To ensure that your records are not easily falsified, have multiple physical and digital copies. Don’t forget to label each receipt and invoice with relevant information, such as the date, amount, and expense category. This data makes it easier to figure out when the transaction was made and what it is for.
Tip #2: Utilise Accounting Software
If you want real-time access to financial data, you need to familiarise yourself with accounting software. This allows small business owners to monitor their cash flow, track expenses, and identify areas for cost-saving. With accounting software, business owners can make informed decisions about the business’s future.
There are also several regulations that Australian small businesses adhere to. This includes the Goods and Services Tax (GST) and Single Touch Payroll (STP). With the help of accounting software, small business owners can easily comply with these regulations by automatically calculating GST and submitting STP reports to the Australian Tax Office (ATO).
If you want to know more about accounting software options, here are a few that work well for small businesses in Australia:
- Xero: A cloud-based software that connects small business owners with everything they need, including tracking, recording, and compliance. This simplifies everyday admin tasks to make running a business smoother.
- MYOB: This comprehensive accounting software takes away the stress of bookkeeping with features such as payroll, invoicing, and inventory management.
- QuickBooks: This is a user-friendly accounting software that helps track business income and expenses with ease.
Tip #3: Streamline your Bookkeeping Process
As a small business owner in Australia, you are often handed many responsibilities to keep your business afloat. This includes bookkeeping.
To become more time efficient and avoid bookkeeping errors, you need to streamline your processes. Here is how you can do it:
- Set up a system. This ensures that all your data is accurate and no information is lost or forgotten.
- Separate your finances. To avoid confusion, business owners must always separate their personal bank accounts from their business accounts. This also makes tracking your transactions easier.
- Automate payments. Bills and invoices can be handled more efficiently through automated payments. This method saves you time and is less likely to have errors. There are accounting software options that offer this feature.
- Hire a professional. If you want to ensure all your bookkeeping processes are done right, you can hire a certified bookkeeper to help you.
Understand the Australian Bookkeeping Regulations
To run your business without a hitch, familiarise all bookkeeping regulations. By making sure your business complies with all these regulations, you won’t have to worry about complaints and penalties. Bookkeepers for small businesses and BAS agents in Melbourne can also help you with this.
Master Your Books and Master Your Business
It is your job to ensure your business runs smoothly. And to give you a hand, bookkeeping services in Melbourne, like Bright Bookkeeping, are here to help you. Find out more about what we do by giving us a call.