When you are juggling a small business or startup…. every penny counts.
Here are our top four tips for saving money on you bookkeeping:
1. Organize your receipts
Keeping your receipts well organized can sometimes be difficult when you are busy running your business. As bookkeepers we are never surprised when a new client brings in bags or boxes of mangled receipts. However, if you are looking to make your bookkeeping as cost effective as possible then the easiest way to save money is to make sure your receipts are well organized so that the bookkeeper does not have to sort them for you.
In addition to sorting them, make sure they aren’t scrunched up into little balls. You may laugh but a lot of people do this and it takes a lot of time to un-scrunch them. Additionally scrunching them up can cause the ink to wear off which means that you are paying us to un-scrunch receipts that turn out to be blank pieces of paper.
Also if you want to claim the GST you paid on a meal as well as the tip (in addition to cutting down the amount of time we spend entering your data) make sure you staple together the original itemized restaurant bill to your credit/debit slip.
A common mistake a lot of first-timers make is arranging their receipts by month instead of by category.
The fastest way for your bookkeeper to enter your bills into Quickbooks is if they are sorted by category. If you want to go one step further and really limit the amount of time a bookkeeper spends on your file, organize your receipts by category AND company eg. Under transport put all your Translink receipts together.
If you are incorporated then you need to organize your receipts by payment method (eg. Visa account, cash, business savings account) rather than by category so that it makes it faster for your bookkeeper to enter your bills and reconcile your accounts.
2. Keep your receipts/documents in one place
Create a filing system for your receipts/ documents and utilize that system so that you can ensure all paperwork is easily accessible.
Keeping your receipts all over the place can result in two issues.
- You will lose some receipts. This means your reporting will be inaccurate and you may miss out on including significant write-offs in your tax return.
- You will need to keep contacting your bookkeeper to let them know about additional receipts you have found or to ask them to hunt down important documents for you. This means that you will utilize more of their time and your fees will increase.
3. Save your online receipts to a flash drive, or upload them to LedgerDocs
These days a lot of businesses send email receipts. Although you have the option to forward all of your email receipts to your bookkeeper we recommend that you download your invoices and save them onto a flash drive that you can submit with your paperwork. This saves your bookkeeper time as they do not have to sort through all of your emails, in turn saving you money.
It also means that if your email crashes you have all of your important documents saved elsewhere.
If you’re using LedgerDocs, snap pictures of your receipts and forward them to your unique email address in real time. We’ll take care of the rest! Contact us here if you are interested in signing up!
4. Don’t keep receipts you can’t claim
Know what you can and cannot claim and know your categories. For example: in most cases YOU CANNOT CLAIM CLOTHES as an expense unless they are branded with the company logo or required safety wear.
Additionally, you cannot claim haircuts, facials or any other kind of personal maintenance even if you are a TV personality or the face of your company.
Placing receipts into your file that you can’t claim just means that your bookkeeper spends extra time sorting through receipts, remember time is money.
Regardless of what state your bookkeeping is in we are happy to help you. That said, we always recommend that you consider these points because it not only helps you save money it keeps your bookkeeper happy and guarantees that you will be added to their secret list of favorite clients.
If you need help getting organized contact us today.