Many self employed individuals and small business owners are often go-getters who focus 100% of their time and energy on growing their business. They are tinkering on new products, or out making sales calls. Once they’ve landed the sales, they are usually following up diligently to make sure that everything goes smoothly. However, one area that self employed individuals lack in is accounting. But it tends to be one of the most important aspects of business.
Why You Need To Be Diligent
When you’re self employed, you need to know exactly where your money is going and where it is coming from. By focusing on entering all invoices and expenses, and accounting for everything, you can have a much more accurate snapshot of your business so that you can see where you can improve.
Furthermore, self employed individuals are usually more scrutinized by the HMRC when it comes to paying taxes and filing returns. Since it is harder to justify income and expenses (more often expenses), many self-employed individuals can find themselves audited. This is where having accurate accounting records can come in handy. If you have clear records with receipts to back it up, you audit will go smoothly and chances are you can vouch for every line item.
If you feel like you just don’t have the time for accounting, there are several options for you. First, you could outsource your accounting to a firm or even a freelance accountant. Then, you would just need to send them all your information once a month, and they will do all the record keeping for you.
If that still sounds too tedious, there are now online programs like Wave Accounting or Kashoo that link directly with your online bank accounts and can import transaction information and classify it for you. This can save you a lot of time and effort when it comes to inputting your information.