Let’s be real here: nobody starts a business because they want to manually upload their Facebook ad spend or categorise their receipts.
But whether you’re a casual side hustler or a serious business owner, you know that bookkeeping is the necessary evil of making money. Or do you?
Delaying your bookkeeping costs you money. If you’re not consistently tracking your income and expenses, you’re paying a hidden “procrastination tax” in the form of lost deductions, increased accounting fees and poor business decisions.
Lost Deductions: The “Ghost” Tax Deductions
If you only do your bookkeeping once a year, in a panic, in April, then you’re likely to forget about a bunch of small expenses. The “ghost” of the £20 you spent on a morning coffee or the £50 you spent on a lunch meeting or the £100 you spent on an online ad – these deductions are likely to slip your mind when you’re sitting at your kitchen table, covered in receipts and pulling your hair out. When you forget to track these expenses, you lose the right to claim them on your tax return. Every pound you forget to claim is a pound more you pay in taxes. For advice from Stroud Accountants, contact https://www.randall-payne.co.uk/services/accountancy/stroud-accountants/
Higher Accounting Fees
When you delay your bookkeeping, you put your accountant on the spot. They have to clean up a mess that you could have avoided with consistent tracking and they’ll charge you for it. Most accountants charge more for emergency bookkeeping services than they do for regular maintenance, so if you’re consistently behind schedule, you’re going to pay a lot more in accounting fees.
Poor Business Decisions: The “Flying Blind” Business Decisions
If you’re running a business without a reliable financial system, you’re making business decisions blind. You might be able to get by for a while but if you wait too long, you could end up overpaying for employees or spending money on marketing that isn’t working. You might be wasting money on a project that is actually losing you money. And when you finally realise the truth, it could be too late, the money could be gone and the damage done.
The 15-Minute Cure
Keeping your bookkeeping up to date doesn’t have to take a lot of time. In fact, all it takes is 15 minutes every Friday afternoon to match your bank statements and take a photo of your receipts. That’s it. Once you get into the habit of tracking your income and expenses regularly, you’ll never have to deal with the procrastination tax again.
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