Ten quick wins to get your finances organised
When we first speak to prospective clients it’s all about understanding their business, learning about what they’re trying to achieve, and then discussing how we can help them on their journey.
We will ask business owners how they currently manage their finances, from daily bookkeeping, to filing tax returns and paying their tax bills, and how they plan for taking money out of the business.
This discussion will normally indicate how organised the business is, and also highlight some simple steps they can take to be more in control of their finances.
Here are some of the common quick wins:
Have a separate business bank account – and keep your business account clean of personal transactions. There are lots of new banking options, so do some research about the features that really matter to you. Mettle, as an example, is a free business bank account, and has the ability to put your money into pots - so you can easily set aside money for tax payments
Keep your tax references, logins and passwords safe – be it your government gateway, VAT registration and PAYE scheme details, online banking, or email accounts logins. Consider an app, such as Lastpass, to keep your passwords organised and secure
Access your business and personal tax accounts regularly - check for messages from HMRC and ensure you don’t have any outstanding tax bills to avoid penalties and interest
Manage your finances using bookkeeping software – ditch the spreadsheet, save time, and utilise the many benefits of having real-time access to your daily finances. For our bookkeeping clients we use Xero, we love it’s functionality and reporting
Link your business accounts to your bookkeeping software – set up feeds for bank accounts, Paypal accounts, and credit cards, so you can keep track of your income and expenditure in one place
Scan receipts and supplier invoices electronically – lose the shoebox of receipts and take a snap – ensuring you have evidence of business expenditure and proof for that VAT reclaim. There are a number of good apps for this, such Hubdoc (which comes free with Xero bookkeeping software) or Dext
Keep track of who owes you money – you should review at least monthly that list of unpaid invoices, and take actions to chase payment, such as setting up overdue invoice auto-reminders. If you use Xero you can get reports showing your unpaid invoices at a click of a button, and set-up periodic invoice chaser emails
Regularly review your financials – not only is this vital to assess performance, but is also key to track when you need to register for VAT, or to make sure you have enough cash to pay your monthly payroll. If reviewing financials is not something that comes naturally to you, why not ask us at Scotch Accounting for help?
Set a budget for the year – give yourself a target to aim for and get into the habit of thinking forward – including setting a plan of how much money you want to take out of the business. Scotch Accounting can help you build a budget for the next year or a five-year plan to give your business direction
Keep your company administration up to date – insurance renewals, board minutes, dividend vouchers all need to be maintained
Running a business isn’t easy, but staying organised and in control of your finances will give you more time and put you on the front foot to keep driving your business forward.
