With EOFY fast approaching, many businesses start to focus on cash flow management, fulfilment of tax obligations and a business plan for the upcoming financial year. What is the single best way to ensure you are primed to accurately review these questions?
Make sure your bookkeeping is spic-and-span!
So, without further ado, here are my 5 top tips to becoming a bookkeeping badass (you’re welcome!).
Get amongst Receipt Bank
The ATO requires that all data be kept for a minimum of 5 years (sometimes longer). Receipt Bank takes all the work out of this for you, by allowing you to take photos of your receipts and literally throw them in the bin! It also integrates with Xero, so will easily match against transactions in your bank feed. Found a bunch of receipts for transactions that have already been reconciled? Fear not, RB’s new feature will automatically search reconciled transactions in Xero. Madness!
The power of the ABA file
If you are adhering to tip 1 above, you are already using Receipt Bank to load your invoices and receipts directly into Xero (high five!). Now you can use the Payables Report in Xero to review and bulk pay invoices with a single ABA file. Simply upload to your internet banking and the job is done. You can also use ABA files to manage your payroll payments with a single click.
Set aside funds to pay tax
An (unfortunately) inevitable part of running a business is paying taxes. These can be in the form of GST, PAYG withholding, PAYG instalments and employee super contributions. Often these can fall due all at the same time, which means if you haven’t budgeted appropriately for them, you could find yourself breaking out in cold sweats when you don’t have the cash to pay the liabilities. The best way to avoid this is to open a separate bank account and make regular transfers to it so you are under control when the ATO comes calling.
Separate personal and business finances
Never, ever use the same bank account for personal and business transactions. Doing so will guarantee your bookkeeping becomes more arduous and also inhibits your ability to accurately review your cash flow.
Set aside a regular time for your bookkeeping
Whether it’s a Monday morning ritual or something you do over a glass of wine on a Friday night (oh, the joys of small business ownership!), doing your bookkeeping regularly will help keep it more manageable. It will also give you the added bonus of having a good understanding of your cash flow, catching un-paid bills and staying on top of customers that haven’t paid.
Feel like you don’t have the time to truly invest in badass bookkeeping?
Get in touch to see if we can help!