Keeping tabs on everything your company spends money on can be challenging at times. Click here for expert tips on how to track business expenses.
There are approximately 37 billion small business currently in the United States and overall this year tax refunds were down 16% from last year.
Tracking your business expenses allows you to get the most money back at the end of the year. Accurate tracking also guarantees you are paying your employees and vendors the right amount and are getting paid for all the work you perform.
So can a small business owner learn how to track business expenses efficiently? The answer is yes and read how below.
How to Track Business Expenses, Efficiently
While tracking your business expenses helps with your taxes and making sure money goes where it belongs (to vendors and employees). Tracking also helps you to better understand the current state of your cash flow and as well as the financial health of your company.
Below are some tips to help you conquer expense tracking.
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Open a Dedicated Business Bank Account
Do not mix business with pleasure and do not mix personal monies with business ones, it will only hurt you in the long run.
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Use an Accounting Software
It doesn’t matter if your software is online or on a desktop, an accounting software can speed up the efficiency of your financial tracking.
You should also consider using a pay stub maker to generate employee pay stubs. This cuts down significantly on your time.
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Create a Method to Scan, Sort, and Store Receipts
Consider choosing an accounting software that has a way to snap pictures of your receipts to store them within the software.
Just as you want to keep separate banking accounts you also want to keep separate credit cards for your company. Make sure that your business is equipped with a credit card for work expenses to easily track and organize your finances.
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Consult with an Accountant that Specializes in Small Businesses
There are decisions you have to make about how to set up your books for example. Is it better to use cash or accrual? In your line of work? What business expenses are tax-deductible? You could spend hours researching or you could talk to a professional and have them help you make the right decisions.
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The Devil is in the Details
Often small business owners forget about the little expenses in their jam-packed days. Depending on your type of work, you should track mileage, entertainment expenses, uniform or clothing expenses and much more.
The little expenses add up and can save you money when it comes to tax time.
The best course of action for a small business owner is to use technology to reduce the time it takes to track business expenses and to track daily so the task doesn’t become overwhelming.
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