Tax is hard. So is accounting, and bookkeeping too. Above all that, you’ve actually got a business to run!
Particularly if that business is new (or you’re new to running it), there’s bound to be speed humps along the way.
And sometimes, you’ll get it wrong. Don’t get discouraged – it happens to lots of people! But a bookkeeper can help iron out those pesky financial mistakes that have been weighing down your business, especially when it comes to important tax time.
Financial errors business owners make
Mixing business accounts with personal accounts
You’re opening up a can of worms here! Don’t do it.
That’s easier said than done, however, especially for small businesses when they first start out. It’s not uncommon, however it makes it really difficult come tax time to go back and determine which debits and credits were for business, and which were for personal.
Mixing business accounts with personal accounts has two major caveats:
- It makes accounting and particularly tax time more difficult (and consequently more expensive)
- It makes it harder to calculate accurate and correct deductions
Not backing up data
Red alert! This is one of the worst financial sins you can make as a business owner!
Once you’ve determined which solution is the best for you and your business needs, you can leave the storage and back up to the genius of the cloud.
Automatic updates keep your data behind the best security walls, while the advantage of cloud means you can access files means your data is always secure, and is always accessible from a variety of backups.
Not accurately recording receipts
Paper receipts are annoying – we get it.
But when it comes to business transactions, you must accurately and swiftly record these receipts for when they’ll matter.
Today’s technology provides us with welcome cloud-based solutions, letting us store (and backup) important business receipts electronically. The stereotypical “shoebox of receipts” is in fact a thing of the past.
Neglecting to record receipts “small” receipts
An Uber here; a taxi there… you mightn’t be too concerned with that $9 fare, but even small business-related expenses should be recorded. Always ask for a receipt and, as above, proactively snap a photo and save them. Once that’s done, you won’t need to worry about misplacing paper receipts. No excuses!
Timing and planning is key when it comes to business bookkeeping
For most businesses, BAS lodgements must be submitted several times throughout the financial year. Missing BAS lodgement deadlines can result in fines starting from $180. This is a wasteful fee that can and should be avoided.
Messing up your time periods
Poor planning is the culprit here.
Trying to do it yourself
This one relates directly to the above. Did you know that if a lodgement is late but it’s due to your bookkeeper’s error, the penalty may be cancelled? This is called a Safe Harbour exemption.
(It’s important to note that a bookkeeper would never intentionally submit a lodgement past its due date – but it does provide that extra layer of protection should the unavoidable occur!)
Bookkeeping from Melbourne’s Maximum Business Solutions
Bookkeepers have the skills and capacity to proactively start to fix the errors you may have inadvertently made through self-managed bookkeeping.
Let’s get real: you’re a business owner, not a bookkeeper, so leave the financial stuff to us, and free up some time so you can focus on your own business strengths.
Maximum Business Solutions is a qualified bookkeeper providing comprehensive bookkeeping solutions to its Melbourne clients. From helping to set up cloud-based accounting systems to complete bookkeeping management, Maximum Business Solutions is the answer to transparent and hassle-free bookkeeping and accounts management.