Honestly speaking, receipts are those important papers that should be kept safe but somehow get lost some day or other. If you are a small business owner and you also often misplace your business receipts, then you must read this article! Today we are going to tell you why proper management of receipts is necessary and how can you achieve this simple yet annoying task.
Business receipts are essential documents that help your small business in all financial matters. Starting from complex tax filing to keeping records of deductions, receipts come to your rescue. That’s why all small businesses should start taking receipt management seriously.
Is keeping receipts really that important for a small business?
If you are still wondering why a small business owner keeps receipts, we must tell you why these receipts are really helpful at the time of tax filings. While claiming business expenses, you must have receipts to substantiate your expense claim. It becomes important to ensure that a proper system is there to manage business receipts. This would save your time in managing your small business, which otherwise you would be spending in finding receipts. If you want to learn some ways for effective receipt tracking, then here are some quick tips:
File receipts ASAP
As soon as you receive the receipts, move them into files. This is because there are high chances of misplacing the receipts if you get distracted by some work or the other. DON’T make it a habit to pile up the receipts to file later when you have time. First things first, file the receipts frequently before they stack up on your table.
It is also a great idea to keep noting the business purpose of each receipt. This would help you differentiate between business and personal expenses.
In addition to noting the business purpose of every receipt, it’s a good habit to make a classification of your receipts based on their expense type. For example, personal expenses can be further classified as rent, travel, entertainment, insurance, and so on. Similarly, business expenses can be classified as purchases, office rent, professional fees, etc.
We all know managing the receipts physically is a difficult task with the possibility of misplacing them or ruining them. To avoid it, you can scan your receipts and feed them into your computer. You can also use your phones to scan the receipts and save them on a cloud. No more worries that receipts will get misplaced one day!
Use apps for receipt management
You can take help of various apps that will help to keep your business receipts digitally. Additionally, these apps can help you maintain expense reports based on receipts, making financial tracking somehow easier. If you ask us, Receipts Bank is one of the best among all apps.
At last, we would say don’t just follow these tricks but obey them religiously. It is important to be consistent in your receipt management process as one miss or delay can make all your efforts futile. Trust us, effective receipt management can make your life easier!