Thursday, 23 Aug 2018
Staying on top of your books when you are still trying to set your feet in the industry can be daunting as well as nerve-wracking. The most common challenge with smart bookkeeping is that entrepreneurs are not aware of the ways of making the task easier. With the Australian accounting services industry making $20 billion in revenue in 2018, the rise in demand for domain-specific bookkeeping services seems understandable.
The professionals have the knack for making the process streamlined so that filing taxes is not a big hassle and all the expenditures are captured without missing any write-offs. When you have a well-drafted plan of your income and expenses, then concentrating on your business activities is much easier.
Also, tax planning helps you save a few dollars that would have been lost for no reason. Thus to be in charge of your books, you need to know how to make bookkeeping a stress-free job. Here are the top five ways that professional bookkeepers in Melbourne follow to keep the books in order:
Efficiency is a pre-requisite for success in a commercial setup. Keeping the financial documents updated and systematic ensures that you put a tab on the expenditures, tax deductions and the available balance. For small business owners, there is a pressing need to keep their personal and professional records separate so that the tracking of expenses becomes smooth.
Keep dedicated bank accounts for personal and business use and do not combine the funds for any purpose whatsoever. Also, the ATO needs the financial records for the past five years from all firms. Thus you must keep copies of all invoices, receipts, payments, salaries paid, tax return documents, bank and credit card statements logically organised.
Your business must follow the rules of the game and should not falter in acquiring all the registrations and licences to benefit from tax-saving tactics. Every business must have an Australian Business Number and GST registration if the turnover is in excess of $75,000.
Additionally, the business must be registered for PAYG withholding Tax to pay the salaries of the employees and withhold tax on their behalf. Companies are also required to submit business activity statements with the ATO. Professionals keep track of all these compliance obligations and help you meet your end-of-year tax liabilities effortlessly.
If you think that you have all the time in the world before you file taxes, then you are in for a disappointing surprise. You cannot wait until the last moment to start working on the books. The more you wait, the more time you will lose in catching up.
The key is to proactively work towards invoicing which does not lead to late payments and delayed sending out of receipts. You do not have to do it every day, but working on it as and when a financial activity takes place is the best way to go about it.
If you miss even a small detail, it can mean pulling out information from piles of paperwork to match the balance sheets. In the midst of putting things on the backburner, you may miss out on paying overdue bills which will impact your credit. So it is ideal to start early.
As a business owner, you must be able to understand your books and the transactions taking place in your accounts. If you have a fair idea of your accounts, you will be more empowered to lead your business in the right direction and grow while profoundly analysing and reviewing your cash flow, balance sheets, taxes and more such financial concepts.
Besides these, you must be aware of the laws about your domain and comply with all the regulations to keep pace with the competition. If you are unable to read your accounts, you can easily become a victim of frauds or lose track of your money which can be detrimental for your company.
Most small business owners are under the impression that they hiring a professional bookkeeping company in Melbourne will cost them a lot. However, the truth is that doing accounts yourself or with the help of a novice employee can incur higher costs due to errors, lack of knowledge, delayed payments, and higher tax payments.
Plus, you would be wasting a lot of time and effort in getting the books in order which can be utilised in focusing on the core business needs. With the expertise and experience of a professional, your business can benefit manifolds with time and money savings.
Improving the bookkeeping process should be a high priority task on the to-do list of every entrepreneur who wants to ensure correct tax filings and maintain a record of the steady cash flow. Professionals can go a long way in making sure that the business owner gets all the financial information classified and arranged to make better decisions and break free from the tedious task of number crunching.
