Keeping up on all your bills and expenses can be a stressful and time-consuming task. It can be doubly challenging if you own your own business. Here are some tips to help you stay on top of all your finances.
Divide and conquer
While it may be tempting to run all your business expenses through your personal credit card, you should have a dedicated business credit card. You’ll thank yourself when tax time comes and you have an easy-to-view record of your business expenses. You should also have separate chequing and savings accounts for personal and business use.
Hire an accountant
Even with all your paperwork properly organized, it’s typically worth investing in professional help to manage your books and file your taxes. No matter how good you are at running your business, there’s simply not enough time in the day to do it all. Take the guesswork out of your finances by hiring an accountant.
Use cloud-based software
If you’re a smart business person, you probably already do a lot of your work in the clouds. Figuratively. Cloud-based programs are automatically backed up and remotely accessible to anyone you give access to. With a cloud-based accounting program such as FreshBooks, you can automate things like invoicing and sending out late-payment reminders to help with your cash flow. And you can set up your accountant within the platform, which gives them real-time access to your financial data so they can offer you the best help. Small business owners can also apply for the Canada Digital Adoption Program to help fund cloud-based accounting solutions.
Prepare for tax time
As they say, the only sure things in life are death and taxes. As a business owner you face a double hit of personal and business tax-filing deadlines. You should know what those are so that you can file and make required payments on time to avoid penalties. For example, the tax filing deadline for the self-employed is June 15 every year (or the first business day after if it falls on a weekend).
If you don’t have the funds available to pay your taxes when they’re due, consider applying for a business loan or using a secured line of credit to pay them off and avoid interest and penalties.
Learn more about cloud-based accounting for your small business at freshbooks.com