Unfortunately, a lot of small business owners don’t keep good records. Their paperwork is often all over the place until the night before they have to submit their BAS statement or annual tax return, which leads to a mad rush to get paperwork in to the Australian Taxation Office (ATO) in time. This can lead to all sorts of problems, including things like mistakes with your paperwork and penalties from the ATO. Here are our top five reasons why you should get your bookkeeping in order today:
- It will save you time:
Although you might feel like you are spending a lot more time doing your bookkeeping if you keep on top of it every week, you will definitely save time. Filing everything in the right spot for future reference is much easier while things are fresh on your mind. If you aren’t sure about the best way to go about your bookkeeping, then consider speaking to an experienced accountant to get you started.
- It will save you money:
For a lot of small business owners, completing their BAS statements or annual tax returns consists of collecting all of the paperwork that they can find and giving it to their accountant. Unfortunately, this means that the accountant will have to spend hours sorting through all your paperwork to find any documents that are important or relevant to them. This will end up costing you a lot more than if you were simply able to give your accountant a couple of files of well kept records.
- It will take the stress off:
Rushing to complete your BAS or tax return can cause a lot of stress. If you are sick of putting yourself under way too much pressure whenever you have to submit something to the ATO, then you need to get better at keeping records. If you keep on top of things throughout the year, you will find that it becomes a lot easier to keep the stress off when tax time comes around.
- It will reduce mistakes:
Poor bookkeeping can lead to a lot of mistakes, especially if you end up having to guess or estimate figures. This can, in turn, lead to major fines or penalties from the ATO. If you want to avoid these, then start keeping clear, concise records of everything from your income to your business costs to wages paid.
- It will keep the ATO off your back:
If you do start keeping good records and getting your bookkeeping in order, then you will find that the ATO stops paying any attention to you. If your tax returns are usually correct and don’t have any mistakes, then there will be no reasons for the ATO to audit or penalise you for anything.
As you can see, good record keeping is essential when it comes to running a successful business. Getting your bookkeeping in order will help you manage your business more efficiently, and may even save you money in the long run.