Just finished your tax return? Get set up now to avoid the pain next year.
Just finished your annual return and don’t want to face that same sinking feeling when next year’s return is due? Well, February the month when you’re about to come out of winter hibernation, is a fabulous time for filing so here’s my top three tips for setting up some easy systems to take the pain out of next year’s tax return:
1 Get a hold of yourself! Well get a hold of your receipts anyway. Keeping track of what you spend on your business can be tricky when you are busy concentrating on the other more pressing things you have to deal with. How many times have you got the end of the tax year and been faced with an unwieldy pile of tatty receipts in no kind of order, many faded in the sun from sitting on the car dashboard or worst still lost altogether accompanied by that sinking feeling of you are sure you spent more on train tickets for that one particular project?
Create a holding place for receipts now. One in your wallet or car for when you are out and about and one for transferring to from time to time in your home office. A separate section in your wallet or envelope behind the visor in the car is an easy way to collect receipts when you’re on the move. If it’s not obvious what the receipt is for write on it while you are still at the shop counter to identify the spending category ‘stationary’, ‘photocopying’ – you’ll be glad you did later! For your holding place at home a shoe box is better than nothing but a poly pocket one for the start of each month is better still.
2 Keep tabs on money out: Set up a folder for money out and make a date with yourself once a month to sort out those receipts. You know what they say, “Little and often does you good.” Keep a pile of scrap A4 paper and staple each individual receipt to a sheet. Write on the top of each sheet: Date – Category of spend – Amount and file each sheet most recent uppermost in your ring binder folder. Use tab dividers for the start of a new financial year. It’s easy flick through and quickly enter all the expenditure in an excel sheet from this (either on a quarterly basis or at the end of the year) plus you’ll have all your receipts organised as you go through the year ready either to prepare your own accounts or to pass on to your accountant (your accountant will love you for it). I’m a sucker for a nice file pleasing file makes the task more visually appealing.
3 Get to grips on money in: Set up a folder for money in and keep a paper copy of all your invoices you have issued in date order – again most recent on top for quick reference. Once a month as you get paid by bacs or cheque you can check your bank statement and mark the invoices paid and again it’s easy to track it all at the end of the year and enter into a spread sheet for adding up.
Go on get that February Filing Fix now!
Visit my Transformations website for more information on de-cluttering for home and business.