If you’re like a lot of online business owners, you probably think running your own business is a whole lot of fun. I’ve had my fair share of late nights and adrenaline-pumping moments over the years, as I’m sure you have too. And you know what? I wouldn’t change my self-employed lifestyle for the world.
But here’s the thing…
Sometimes it’s pretty easy to get a bit sloppy with the paperwork. It’s easy to lose receipts, get lax on bookkeeping and generally get disorganised. And that means you’re more likely to make a mistake come tax time, which at best could lead to you not getting all your legal deductions, and at worse could have an auditor knocking on your door.
So whether you do your bookkeeping yourself or you’ve hired someone else to do it, here are three tips for getting better organised…
Print and File Receipts
You may have receipts sitting in your email. You may have them sitting on a vendor’s website (like in your Amazon.com or Dell.com account). Nonetheless, it’s a good idea to print and then file your business-related receipts. That way you have all your receipts in one place, and having them organised makes it really easy for your accountant to do your bookkeeping and taxes.
Take Care of Bookkeeping Regularly
Some business owners do their bookkeeping once a month or even once a quarter. That’s living a bit dangerously, as it’s easy to forget to enter certain debits and credits if you’re trying to rush through and do a bunch of bookkeeping at once. What’s more, it’s much harder to find a mistake if you have three months worth of entries in front of you.
The solution?
Take care of your bookkeeping regularly. You may enter all debits and credits into your software the same day they come in. At the very least, you should do this on a weekly basis.
It’s kind of like cleaning your house – it’s easier to pick things up each night, rather than waiting to clean until the house gets really messy. The same goes for your bookkeeping. Just get into a habit of doing it right away, and you’ll never again have that feeling of dread at the end of the month or quarter.
Know Your Tax Deadlines
If you live in the U.S., then you’re probably well aware of the April 15th tax deadline. However, now that you’re self employed, you also need to know the deadlines for paying estimated quarterly tax. These deadlines are generally on around the 15th of January, April, June and September. Check IRS.gov for more information.
Same applies to you if you live outside the United States – you need to check with your local tax organisation to find out when you’re required to pay taxes and file paperwork. Put these dates on your calendar, and make sure you complete the tasks ahead of the deadline so that you don’t have any last-minute panic.
Conclusion
Running your own business is awesome, but it does come with a whole new set of rules and regulations, especially with regards to taxes. A lot of people dread this part of running a business. But you can make it easier by doing two things:
- Get organised and stay on top of your accounting using the tips above.
- Get an accountant to do much of this work for you.
There’s no better time than right now to get organised, so set some time aside to work on your business accounting today. Come tax time, you’ll be glad you did.
