Bookkeeping: Capturing and organising receipts

Keep your business receipts tidy and organised using the tips in this blog to make completing your tax return a cinch.

Here are our top tips for quickly and efficiently compiling, organising, and storing your business receipts.

Make notes – Get into the habit of writing a quick note on receipts about what they are for if it isn’t immediately obvious. This will make it quicker and easier for you to categorise your receipts at a later date.

Digitalise – When you have lots of paper receipts lying around it’s easy for them to get lost. Stacks of paper receipts also take up space and can easily become disorganised, making it time-consuming and frustrating trying to find the information you need. Over time, the ink on receipts can also fade, making them difficult to read. However, technology now makes it easy to go paperless by digitalising all your receipts. There are many ways you can do this, including:

  • Use a receipt scanner smartphone app and online service.
  • Photograph receipts with your smartphone’s camera.
  • Use the office scanner.

Categorise – Whether you choose to store paper receipts or go digital, you will benefit from categorising your stored receipts. Examples of common categories include:

  • Marketing
  • Travel
  • Rent
  • Entertainment
  • Office supplies
  • Utilities
  • Insurance
  • Postage

Some receipt scanner apps and online services will automate this process for you and even send the information to your accounting software.

Use accounting software – Keeping track of your receipts using accounting software is far more efficient, organised, and secure than trying to keep track of things using paperwork. When you digitalise your receipts and store the information in your accounting software you can perform a quick search to find the information that you require at the click of a button. It also makes it easy to quickly sort your receipts and analyse your expenditure. Most accounting software will store your data online in the cloud too, allowing you to access the information from anywhere and giving you peace of mind that it is safe and secure.

For more help or advice with your bookkeeping, get in touch with our team here at Michael Bell by calling us on 01484 690 730 and we will be happy to help you.

What is an exit strategy and why do I need one?

All good things must come to an end, and there will come a time in your life when you’re ready to either start playing a smaller part in the running of your business or say goodbye to it forever.

Having a well thought out exit strategy already in place will help you to sell or otherwise dispose of your business quickly, profitably, and with minimal stress and hassle.

What is an exit strategy?

An exit strategy is a plan for selling your business in order to maximise profit and the business’ chance of success once your involvement has ended.

Some common types of exit strategy include:

  • Sell to an outsider
  • Sell to investors
  • Sell to family
  • Liquidate
  • Initial public offering (IPO)

When planning and preparing your exit strategy you should aim to get your business to a point where all business information and accounts are up-to-date, and all business processes are documented. This will allow you to hand over ownership to someone else swiftly should you be unexpectedly required to do so.

The type of exit strategy you choose may depend on several factors including:

  • Whether you want any continued involvement in the business.
  • Your business type and size.
  • How successful your business is.
  • How quickly you wish to exit.
  • How important it is to you that your business continues in the same way.

Why is it important to have an exit strategy?

A well thought out exit strategy can help you to get more from your business when you eventually decide to part ways with it. Even if the business has not been successful, an exit strategy will be beneficial as it can help you to minimise losses.

You never know what could be around the corner and having an exit strategy in place will allow you to sell your business quickly, efficiently, and with minimal stress in the event of the unexpected.

Some reasons you may require an exit strategy in place and ready to implement include:

  • Retirement
  • Business isn’t doing very well.
  • A new opportunity comes along.
  • A change in your personal life.

It is wise to seek professional and objective help with planning your exit strategy to ensure that your valuation is realistic, and your plan is as profitable as it can be.

Preparing your accounts

You will need to make sure that all your business’ financial records, accounts, and bookkeeping are up-to-date and organised before seeking a buyer for your business.

For help or advice with planning your exit strategy or preparing your business accounts for selling your business, get in touch with our team of experts here a Michael Bell by calling us on 01484 690730.

Bookkeeping tasks to complete in January

January is a great time to review your bookkeeping processes and get your business’ finances organised for the new year.

For many businesses, January is a quiet time of year that is best used to review performance and processes and plan and prepare for the year ahead.

Complete the following bookkeeping tasks in January to make looking after your business’ books simple in 2020.

Make sure everything is up to date

Start the new year as you mean to go on by ensuring that your business is up to date with all payments to suppliers and ensure that any late payments owed to you have been chased so that you’re starting the year with a clean slate.

Review your bookkeeping software

The right software can help make bookkeeping tasks quick and simple to complete whilst keeping all your business’ important information organised and secure.

Bookkeeping software can also automate certain tasks, saving you time and reducing the risk of human error.

If you don’t yet use bookkeeping software, or are unhappy with the system you’re currently using, January is a great time to research an alternative solution. We recommend QuickBooks, Freshbooks, Sage and Xero.

Review performance

The new year is the perfect time to review your business’ performance throughout the previous year in order to create a cashflow forecast for the year ahead.

Identify where any seasonal dips and peaks occurred and create a budget to help you to manage your cashflow over the year.

Review processes

If you feel like you’re forever playing catchup with your bookkeeping or losing important information, then now is a good time to review and improve on the processes you have in place.

Get organised by setting reminders for submission deadlines and invoice due dates for the year ahead. Create a process to capture and store receipts electronically at the time of purchase to keep your records secure and accurate.

For further help or advice with your business’ bookkeeping and accounts in 2020, speak to our team here at Michael Bell & Co by calling us on 01484 690 730.

Plans to cut corporation tax put on hold

Prime Minister Boris Johnson has announced that the planned cuts to corporation tax are to be put on hold.

On 1st April 2020, corporation tax was due to fall from 19% to 17%. However, in the run up to the December general election, Conservative party leader Boris Johnson has announced that this cut to corporation tax is to be put on hold to help fund “other priorities”.

Johnson has said that the money that would have been spent on the cut, will instead be put into the NHS and other national services. An article on the BBC website, however, claims that the cut would not mean any additional money being spent on the NHS, instead it would be used to fund an existing pledge to GP training.

During the speech where Johnson made the announcement, he made a plea for business leaders to understand his decision, claiming that it was the “fiscally sensible thing to do” and would allow him to put £6bn into public services.

With the general election on the horizon, it’s thought that Johnson has made the decision to distance the conservative party from their image of being a party for big businesses and the wealthy.

At the same conference, Labour leader Jeremy Corbyn announced that he planned to raise corporation tax but promised that rates would be no higher than they were in 2010 when Labour were last in power.

Corbyn, who has been accused of being “anti-business”, justified his decision by saying: “It’s not anti-business to say that the largest corporations should pay their taxes just as smaller companies do.

“And it’s not anti-business to want prosperity in every part of our country – not only in the financial centres of the City of London.”

For help or advice regarding corporation tax, give our team of accountants here at Michael Bell and Co a call on 01484 690 730.