When running a business, it is important to make sure you have a good record keeping system. Some of the main records you will need to keep are the income and expenses for the business, purchases of plant and equipment, salary and wages, superannuation plus a number of other items. Keeping good records helps minimise tax compliance. Poor record keeping may cause overpayment or underpayment to the tax office. When this happens it then has to be sorted out where the mistakes have occurred. This may cause a loss of time and money for the business, as someone has to spend time to sort the problem out if you don’t hire a payroll Tunbridge Wells company.
It is a personal choice but having separate bank accounts for private and business affairs can be a wise choice. Where a joint bank account is used, whether it’s a bankcard or other account, it will have deposits and withdrawals that are not related to the business. And it will have deposits and withdrawals for the business. Unless the business expenses and deposits are all recorded in the bookkeeping of the occupation, then when it comes time for tax compliance it will be harder to work out what belongs where.
For paperwork have a good filing system that is easy to access if needed at any time. Alphabetical filing makes it easy to find something. Use a backup system for computer entries and do this on a regular basis. If the system crashes it can be a nightmare trying to sort out the mess.
Record keeping also involves keeping all receipts and tax invoices, plus all other paperwork to do with the running of the business. If vehicles are used as part of the business, then travel logs are generally required to make claims for travelling related business trips.
Getting the services of an accountant or bookkeeping firm who can help you understand the records you need to keep, what you can claim on and other information associated with running a business can help the business succeed and move forward.