Let’s be real: Keeping track of business expenses feels like herding cats. There’s always that one stray receipt or overlooked online transaction that sneaks away. But, worry not because we’ve got some top expense-tracking tips for you to get stuck into right now.
1. Digitize Those Receipts
Receipts are like confetti: great at parties but annoying when you’re finding them everywhere! Snap a pic and store it digitally. Apps like Evernote or Dext are perfect for this. Not only will you declutter, but you’ll also have a backup in case the original gets lost in the abyss of your bag.
2. Keep Business and Personal Separate
This might sound like Dating Advice 101, but trust us, it’s solid financial counsel. Having separate bank accounts for business and personal expenses keeps things clean. It’s like sorting laundry – whites here, colors there, and business expenses neatly tucked away from that weekend splurge on artisanal coffee.
3. Schedule Regular Expense Reviews
A weekly date with your books isn’t the most romantic rendezvous, but it’s necessary. Regular reviews help catch mistakes early. Pop open a bottle of your favorite bubbly (or kombucha), play some jazz, and let those numbers serenade you.
4. Hello, Fleet Fuel Cards!
If your business has a set of wheels (or several) involved, fuel expenses can become a wild beast. Tame that beast with fleet fuel cards. These handy cards, which you can read about more at Coast | The Smart Visa Fleet Fuel Card And Gas Card, let you monitor and manage fuel expenses efficiently, offer discounts, and give you detailed reports on consumption. Plus, no more hoarding fuel receipts that somehow always end up smelling like stale coffee.
5. Get Techy With It
Gone are the days of manual entry into massive ledgers (unless you’re into that vintage vibe). Softwares like QuickBooks or FreshBooks can automate expense tracking, send invoices, and even connect to your bank account for real-time updates.
6. The Magic of Monthly Subscriptions
Just like you should keep on track of subscriptions to things like Netflix and Chees of the Month club to keep your personal expenses in line, you should also do the same for your business expenses. If you have subscriptions to software packages, industry publications, and the likes, then keep a list and monitor how much you use them. If you use them rarely, you can then cancel them to save money and boost your profits.
7. Daily Expense Round-Up
Make it a habit. At the end of each day, take five minutes to jot down expenses. It’s like a little diary, but instead of “Dear Diary, today I saw a cute dog,” it’s “Dear Diary, today I bought printer ink.” That way, you will never end up with a backlog of expenses to put into the accounts, which means you will also not end up losing receipts and potentially getting in trouble with the tax man when he notices you haven’t logged everything you should have.
8. The Envelope System (with a twist)
The old-school method was to put cash in envelopes designated for specific expenses. But who carries that much cash anymore? The modern twist: Use digital ‘envelopes’ (budget categories) in your accounting software.
9. Tax Write-Offs – Know Them
Knowing what you can and cannot claim as a business expense can be a game-changer. Did you know, for instance, that the cost of certain business books or online courses can be written off? Keep yourself updated, or better yet, befriend an accountant! A good accountant will know all of the tips and tricks to legally deduct expenses, so the better terms you are on with yours, the more money you can likely save and the more on top of your expenses you will be.
10. Travel Smart
Business trips can eat up a chunk of your expenses. Start by setting a daily budget. Use apps to find the best deals on flights, accommodation, and car rentals. And ALWAYS ask for a receipt, even for that tiny airport muffin.
11. Re-evaluate Regularly
It’s always a good idea to reevaluate your business expenses on, at least, a quarterly basis because market values rise and fall all the time, which means you could end up paying over the odds for everything from printer ink to plastics if you do not check what is up with the markets and negotiate prices with your suppliers. It’s the smart thing to do.
If tracking expenses feels too daunting, consider hiring a part-time bookkeeper or virtual assistant. They can help keep things in order and might even spot savings you overlooked as well as saving you time. Having another set of eyes on things really can be a boon, and these days, you can pay individuals on an as-and-when-needed basis, so it needn’t cost you much to have someone else go over the expenses for you.
13. Use Cloud Storage
Backup, backup, backup! Use cloud storage options like Google Drive or Dropbox to keep digital copies of all your important expense documents. his way, if your computer decides to take a surprise vacation, your files won’t go with it and you won’t have an angry IRS person at the door looking for answers that you are no longer able to provide!
14. Revisit Employee Reimbursement Policies
If employees often spend from their pockets and get reimbursed, have clear policies in place. Ensure they know the acceptable spending limits and what can be claimed, so that you do not end up drastically overdoing things in a way that is bad for your business and might not look too good when the tax inspector takes a look either!
15. Automated Expense Trackers
Another thing that can really help you to keep better track of your expenses are automated expense trackers. It’s all in the name! Link them to your bank account and watch as they categorize and record every penny spent. It’s like having a mini-accountant in your pocket.
16. Educate Your Team
If you’ve got a team who are working alongside you, ensure everyone understands the expense policies you have put into place and what they can do to keep their own expenses to a minimum. Regular workshops or training sessions can keep everyone on the same page and prevent future discrepancies or overindulgence on the expense account, better than almost anything else.
17. Use a Dedicated Business Credit Card
This card is exclusively for business expenses so that you know exactly what you are spending on what. At the end of the month, you have one consolidated statement with all your costs in one place. Bonus: Some cards come with rewards that benefit business travel or offer cashback, so you could actually save a little money by buying everything through your business card and you know that makes sense!
18. Periodic Professional Reviews
If you do not employ a regular accountant or bookkeeper, you should still consider keeping track of business expenses, every few months, having a finance pro glance over your books. They can offer advice, spot errors, or highlight areas of potential savings you might not see., so things do not end up getting into a terrible mess before it’s too late.
As you can see, when it comes to keeping track of business expenses, there are lots of things you can do to make it feel like less of a chore, and less like something that is constantly trying to trip you up. So, put as many of these ideas into place as you can and you will not regret it when the tax man comes calling!