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It’s a slippery slope. I went shopping this weekend and whilst picking up bits and pieces for home, I spotted a pack of pencils for the office and picked them up. I paid for them with the rest of my shopping and thought nothing of it until first thing Monday morning when I realised that I had not kept the receipt and also had no recollection of how much they had cost. This goes wildly against my bookkeeping golden rules: 1) Keep a separate business bank account. This means that when it comes to getting up to date with your bookkeeping, if you have been consistent you will know that everything paid in and out of this account solely relates to the business and you don’t have the challenge of trying to separate out business and personal. 2) Try to pay for everything on the business card – no matter how small. This means that even if you have lost the receipt, you have a record on your statement that shows how much you spend and when. If you have also established a track record of keeping all of the business and personal expenses apart from each other, if HMRC enquire into a tax return, the absence of one or two receipts will not be the end of the world given your impeccable track record. 3) Be a receipt geek. Get into the habit of always asking for a VAT receipt – whether you are VAT registered or not – it helps get you into the habit should you register in the future. This also helps should you pay for something in cash or on the wrong bank card, you have the receipt to confirm what it was you bought and how much it cost. 4) Have a receipt dump. Have a place in the house or office where you leave all of your receipts before processing them for the bookkeeping. When it comes to getting up to date, you do not have to search high and low for the paperwork as you will have diligently placed them all in the same place. 5) Keep up to date. If you bring your books up to date on a regular monthly basis you are more likely to remember any anomalies that arose during the month, you will be more likely to remember any missing receipts, which will prompt you to get copies for your records if possible and most importantly you will have better control of your spending to help you monitor your business performance. The key to good bookkeeping is forming good habits, and so even if you are not good with the numbers, if you have followed rules 1 to 4, you can always delegate rule number 5 to someone else! CCF has an in house bookkeeper with some fantastic fixed fee rates for small businesses. Call us on 01423 567499 to find out more. |
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Are you a buy to let property owner? Budget summary for small businesses Don't fall for the 'No Tax Return Needed' Letter! |
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