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The accounting of a business can be frustrating: it consumes a lot of time and does not provide additional income.

A good part of the management activities of an entrepreneur is reduced to the registration and organisation of all the accounting paperwork of the business: bills, expenses, taxes to declare, etc.

Sometimes, what scares us the most about accounting is not so much its complexity as its final result: what if the accounts do not balance? What if I have done something wrong? But expert accountants in central London offer the following advice for entrepreneurs.

Good organisation of your accounting process is essential. You can achieve this by following these five steps:

1. Get an accounting program

The accounting should start with the most basic: the management and control of income and expenses. An accounting program can make your life easier. It is just good common sense.

An accounting program will not only allow you to better manage and control your income and expenses and the taxes you pay, but it will allow you to carry out more accurate business projections and reports on your financial situation.

2. Keep track of your income

Your clients will probably pay you by deposit on account or cash, depending on the type of business you have. Be that as it may, it is good that you keep a copy of the operation to keep up to date with what is happening with each order. It is good that your sales income is in chronological order (per month) or in alphabetical order (by customer).

3. Keep track of your expenses

As an entrepreneur, it is not only good that you keep a record of your expenses, but also organise them by categories. Here is an example:

  • Marketing expenses
  • Sales costs
  • Office costs
  • Facilities and buildings (rent, water, electricity, telephone and internet costs, etc.)
  • Cars and other vehicles
  • Purchase of stock (raw materials and finished goods)
  • Legal and accounting fees
  • Investments, patents, and other rights
  • Insurance and fees
  • Banking and financing costs
  • Cash yields (employee salaries, NI contributions, etc.).
  • Taxes

It may be a very exhaustive list. You do not have to follow it one by one. It is about making a list of categories adapted to your business and your accounting plan.

4. Keep track of your taxes

Any business activity is subject to taxes. Entrepreneurs must submit different tax declarations forms to HMRC (VAT, Personal Income Tax, Corporate Tax) within a fixed calendar period.

It is a good idea to have a schedule written down, where you register the different taxes that you have to declare and the dates by which they must be declared and paid.

Have a folder or file with the copy of your tax returns (arranged chronologically by quarter and year). Also, include a record of the taxes you have paid and what HMRC has returned to you.

5. Saving time is also saving money (and energy!)

Dedicate a few minutes a month to update all the accounting paperwork. Do not leave it until the end of each tax year.

This will save you time because the paperwork that you will have to put in order will be less. And if you save time, you also save money.

In addition, this will allow you to have a clear idea of ​​the status of your accounting, pay your bills and taxes on time (without penalties or interest for delays), know which customers owe you money ... and you will avoid any fiscal mistakes.

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