7 Tips for Easier Accounting

It’s coming up to that time of year, when the deadline for submission of accounts and tax returns for self-employed professionals looms. If you haven’t got your 2019 accounts completed and submitted yet, it might be time to start thinking about it.

Tax Payment

31 October is also the time for payment of preliminary tax for 2020. If you expect to have a tax liability for the calendar year 2019, you should have paid the bulk of the relevant tax by 31^st October 2019.

Feeling depressed yet? Let me make it easier for you, and no, I’m not offering to do your accounts! But there are things you can do to make the whole paperwork issue a lot simpler for yourself.

Tip no 1: Get a dedicated business bank account

With all your practice related transactions in one place, preparing your year-end accounts is greatly simplified. There is a small cost to doing this of course, but the benefits will far outweigh the costs.

Tip no 2: Lodge all your practice income

This will make your records much easier to complete. It also means if you ever want to borrow money for your business, your bank can see the true level of your income flowing through the account.

Tip no 3: Use your diary as a cash book

Your practice life will probably revolve around appointments. Use your diary to record what your clients pay, or if there’s money owed. If you keep your diary electronically, for example on your phone, consider using a system that allows you to download to your computer.

Tip no 4: Record your expenses automatically:

Pay out all your practice expenses by account transfer, cheque, business debit card or business credit card. That way your business records contain just your business records, and the accounting process is much easier because the transactions are recorded on your statements. And yes, again there may be a small cost attached to this, a business credit card will attract annual stamp duty of €40. However, you can use it to book courses, or to purchase books or stationary online or offline.

Tip no 5: If you have to pay for something in cash, get and keep the receipt

An easy way to keep track of your cash expenses is to have somewhere to  store all the dockets until you’re ready to write them up. You might use a wallet or envelope in your bag or case. If you pay online, print the receipt at the time, or transfer it into a folder on your computer to come back to later. Periodically, sort out the dockets into appropriate expense groups. For example put all dockets/receipts for motor expenses together, all dockets for phone together, or receipts for supervision together. Keep items you’ve paid for in cash separate from items you’ve paid by cheque or credit card.

Tip no 6: Subcontract to someone else

Unless you’ve done bookkeeping in the past, you may find it a terrible chore. Get someone to do it for you. Pay a college or transition year student to spend a couple of hours every month sorting out your papers and writing up your books. Your accountant will thank you. Many accountants will also do this for you.

Tip no 7: Technology is your friend

Whatever the task, there is a solution for it! If you are comfortable using technology, try out some of the great apps available to make your bookkeeping easier. Just two of the ways in which technology can be used for your financial chores are using online banking to pay bills and transfer money (all the major banks provide this facility), and using online accounting software to write up your books and records (one of my favourites is Sage). There are oodles of options, look around and find the ones that suit you best.

I won’t offer to prepare your accounts or write up your books for you, but if you’d like some help with making these chores easier, I may be able to help. Please contact me here for your free 20 minute consultation or to avail of any of my services. To find out more about how I can help you, click here.