As a small business owner, you understand the importance of proper accounting practices. Having a system in place to track your cash flow, forecast for the future, and organize everything for an easy tax season is important. However many small business owners have found that they are exceptional at providing their product or service, but are a bit less adept at the accounting side of things. Few people go into business because they are great accountants, and if they do, they have accounting businesses. Fortunately, there is help available. Whether you choose to forge ahead and manage your finances by yourself, or if you hire a professional, a few good tips to help are likely warmly welcomed. Here are 3 of the most important tax tips to help with your small business accounting.
Live By Your Budget
Living by your budget is essential to proper accounting, and also profitability. The scary truth is that many small businesses operate without a budget at all. Having a carefully planned budget allows you to see what you need to bring in each month. It also helps keep in check those ‘wants’ that we often disguise as ‘needs’. A good business budget will be separated into four categories. They are:- Prospective Income
- Fixed Expenses
- Variable Expenses
- Paycheck Allowance
Keeping a carefully organized and planned budget and sticking to it is an essential component of successful accounting.
Keep It Simple
We all have been tempted with the next best software program or the nice new computer technology. After all, many of these expenses can streamline our business, and may even save money in the long run. A wise man once said, “Just because it’s a good deal, it doesn’t mean you need it.” If small business owners indulged in all the great products out there, it wouldn’t take long until the business was broke. Be like the wise man and keep your expenses limited. Your business has fixed costs and variable costs. Fixed costs are those expenses that you can count on each month. You have to pay them whether you made a profit or not. If you seek ways to keep your expenses lean, it will not only make your accounting easier, but will help your business to thrive.
Cross Your T’s
Accounting can seem to be a very tedious task. Again, your passion to own a particular business was probable not because you would get to keep track of the books. However, quite possibly the best advice of all is to keep your records accurate. Make sure that you are keeping receipts and entering every single expense with details into your books. If you bought a client a two dollar cup of coffee, you would be wise to record it. The extra time you take to keep your books accurate and complete can save major headaches, and major expenses down the road.
Do Yourself a Favor – Hire Someone!
From handling all the paperwork correctly to checking the right boxes, a financial professional can ensure that your books are just right, and can help avoid pitfalls such as the dreaded audit. The professionals at Landwehr Financial Services can be a great help in navigating the finance needs of small businesses. Our holistic approach ensures that we will take the time needed to truly understand your situation and make your accounting concerns disappear. Contact us today to learn more about our services and experience first-hand the level of care we give to all our clients in the St. Cloud MN area.
