3 Essential Accounting Tips Every Small Business Needs to Know in 2020

Do you own a startup? In the digital age, there are boundless opportunities for setting up your own business. It can be fun as well as a lot of hard work.

But one of the biggest challenges can be the accounting. Keeping track of your outgoings and what each employee earns as well as their tax situation can be difficult when you don’t yet have the funds to hire a dedicated accountant or human resources manager.

But don’t despair here are some of the top accounting tips to make sure you are always on top of your finances.

1. Accounting Software

One of the easiest ways to go about getting on top of your accounting for small businesses is to use accounting software. One example you might want to consider is QuickBooks small business, one of the most well-known brands.

Accounting software can produce paystubs for all of your employees and do their payroll for you. It can also keep track of your outgoings and how much is in the business at any one time. The payroll can then go out every month or week like clockwork.

Remember though that you do need to check in with the system every now and then and it’s not without its problems.

2. Consider Switching to a Digital Bank

If you are running a digital business then it makes sense to switch to one of the many digital banks that are taking America by storm. These so-called challenger banks like Transferwise, Revolut, or Monzo now offer business accounts.

They allow you to keep track of your spending more easily. They can produce pie charts and graphs detailing how your finances are spent each week.

Digital banks also have another useful feature that can make accounts for small businesses so much easier, the ability to add receipts to each transaction with a simple photograph.

You can make it company policy that each employee has to download the app on their phone and take a photo of any company business spending they do and add it to the account.

Startups like Flux are working on creating systems to allow for automatic digital receipts to be added to your account when you spend on your card. This could revolutionize business expense reporting.

3. Bite the Bullett: Hire an Accountant

Another option you have is to hire an accountant. Getting a good accountant or bookkeeping for small business services can be costly.

However, you could investigate whether you could cut back on other expenses to make an accountant a reality. Be sure to calculate how much you could save by:

  • Selling your expensive office coffee machine and providing instant coffee instead
  • Moving to smaller premises
  • Taking a pay cut

Remember that no app or accounting software can compensate for the secret ingredient for small business success: confidence. 

Best Accounting Tips? Get On Top of Your Finances

The best accounting tips involve using technology to get on top of your finances. Accounting software and digital banks can make it easier and fun for you to keep track of what you spend as you go along.

If you are interested in reading more about the best accounting tips and bookkeeping for small businesses then be sure to check out the rest of our blog.