Talking Cents

How Do I Start Managing My Own Accounts

Running your own small business is an amazing journey. You get to experience the thrill of developing a product, finding a client base, and then watch as your business expands. However, performing the business accounting that goes with that can be difficult, and it's generally best that you work with a dedicated small business accountant for any task more complicated than maintaining a zero-expense business. If you'd like to do your business accounting yourself, though, there are a few simple things you can do to make the process simpler.

Drop Your Business At The Front Door

You don't want concerns about your business to impact your daily home life, and you shouldn’t let your business expenses clutter your personal account. Create a separate business account so that you'll be able to see your personal funds and your business funds at a glance without needing to overcomplicate the already-intricate daily records you'll need to keep. When it comes time to update your records, whether that's a daily log or you're lodging your tax return, you'll appreciate the simplicity a differentiated account allows for.

Don't Forget The Taxman

Working as an employee for someone else makes taxation simple, since it's all handled for you. At worst, you submit your yearly tax return documentation, and you're likely to get a refund. When you manage your own business, though, that simply isn't the case, and you'll need to pay your tax in large lump sums, generally either quarterly or annually depending on the turnover of your business. You'd better start leaving some money aside for the taxman.
Similarly, while there can always be penalties associated with failing to submit your tax return on time, you need to remember that you also need to pay a large tax bill at the same time. If you can't afford to pay a fine of up to $9000 while also meeting your tax obligations, it might be best just to set a reminder on your phone to pay before the due date.

Track Everything

Rember that second account you opened? That makes it much easier to track your expenses, which is an important thing for any business. Wherever you're spending money in service of your business, you're likely to be able to get a tax break, and every taxable dollar deducted can be a big help when you need to pay up to 45 cents a dollar out of pocket. Do you drive for your business? Start a logbook. Do you buy supplies? Track it. Is money changing hands to enable your business to operate? Keep a record of it. It's that simple.

Don't Go It Alone

At the end of the day, small business accounting is complicated. There are so many small details you need to be familiar with, and by the time you become comfortable in the role, your business may have declined. Thankfully, the M.A.S Partners and our leading small business accountants can do the work for you instead, which can help keep your business afloat. To speak with our team of small business accountants in Sydney about what we can do for you, call us on (02) 9211 5000.