Brand new to the world of entrepreneurs? Or perhaps you’ve always been an entrepreneur at heart but you’re just making it official now. If you’re a new business owner, there are some small business accounting tips that you should take to heart.
From keeping your business and personal accounts separates, to staying on top of your books and not forgetting to pay yourself—there’s a ton of things to think about when it comes to small business finance.
Tip #1. Have a Separate Business Bank Account
My top small business accounting tip is to separate your business and personal banking right away. This will save you a headache and a half later and make it way easier to manage your finances (and not get into a ton of tax issues).
Tip #2. Stay on Top of Your Books
I am terrible for staying on top of my books. But I can tell you from experience when you aren’t on top of it, it gets out of control real fast. I recommend setting aside time each week to go over your expenses and invoices, and a tad bit longer the last week of the month to review everything.
Tip #3. Keep ALL of Your Receipts
You do not want to get into a situation where you have to show your receipts and can’t find them. I take a photo of all of my receipts and store them in an Airtable document.
Tip #4. Learn How to Invoice Properly
If you want to make money, you need to invoice clients or customers. Creating an invoice isn’t hard but it’s completely necessary. Find a guide on the internet or take the next of my small business accounting tips to heart and find software that already has them built-in.
Tip #5. Invest in Accounting Software
Accounting software for the small business owner can cost as little as $20 or $30 per month, but it can save a lot of time. There are a ton of software choices out there, so dig around and find the best one for you.
Tip #6. Track (and Code) Every Business Expense
On top of keeping your receipts, you’ll also want to track and code every business expense. That way at the end of the year when your tax accountant looks over your expenses, it’ll be much easier.
Tip #7. Stay on Top of Your Payments
One of the biggest small business accounting tips is to follow up on your payments. SO MANY small business owners sent out invoices or bills but refrain from following up on them. But an unpaid invoice isn’t worth anything!
Tip #8. Don’t Forget to Pay Yourself
You deserve to get paid. And you need to pay your bills. Don’t forget to pay yourself otherwise what are you working for? Besides fun and passion.
Tip #9. Hire a Professional
Don’t do it yourself if you can help it. Accounting is complex for those of us that don’t know anything about it (*ahem* me *ahem*), so if you can spare the cash get a professional. This is doubly the case when it comes to taxes!
Tip #10. Always Know Where You’re At Financially
If you’re staying on top of your books and updating them regularly, then you should have a decent idea of where you are financial. If you don’t, one of the most important small business accounting tips is to know where you are and whether you’re meeting your targets.
What are your best small business accounting tips? Share them in the comments below!
Looking for More Small Business Accounting Tips?
- Why You Should Embrace Time Tracking
- The Paypal Refund Policy Has Changed
- Pros and Cons of Investors for Your Business