Six Tips for Tracking Small Business Expenses

Tracking your business expenses is part of running a successful business as it helps to manage your cash flow. It also helps you when it’s time to do your taxes and want to prevent overspending because of a tracking failure. That’s why Taurus CPA Solutions has created a list of six tips for tracking small business expenses.

 

 

1. Always Save Receipts

Whether you have an online or brick-and-mortar business, you need to save every receipt, whether it was a credit card purchase, cash, a check, or an online purchase. It’s essential to have a designated location for the receipts you save so you can go back and refer to them when you need to, such as during an audit.

 

2. Keep Personal and Business Separate

While it’s relatively convenient to have everything coming and going from one account, it doesn’t help when it comes time to determine what is personal and what is business. When you open a business checking account or business credit card, you don’t risk confusing your money with the money for your business.

 

3. Know What Counts As Business

Once you have separate accounts for your personal and business lives, you need to know what counts as a business expense, so you know which account you use to pay for it. Some business expenses are tax deductible, so you must keep track of them and save every receipt. Our professionals at Taurus CPA can help you with any questions you may have about what’s considered a valid business expense.

 

4. Record Every Transaction You Make

You know how important it is to track your finances and have a record of transactions so you know how much you’ve spent each month. The same goes for your business. If you run a bakery, you need to know how many times you ordered butter and how much you spent on butter. If you neglect to record the transactions for butter, you don’t know how much butter you might need next month and how much it would cost your business.

 

5. Use An App

There are many financial apps out there that you can download onto your smartphone. Some apps have bill and subscription trackers and budgeting features that allow you to create custom budgets and get personalized insights. It might take some time, but exploring your options helps you to determine which app best suits the needs of your business.

 

6. Cloud Accounting Software

To keep your finances in order, it’s a good idea to find cloud accounting software that works for you. That way, you don’t have to worry about not being able to access your data when you need it or trying to guess what you need to do. It’s okay to start with a simple spreadsheet when you first start, but you will need more than a spreadsheet as you grow.

 

At Taurus CPA Solutions, we know how important it is to choose the right solution that meets the needs of your business. We can analyze your financial transactions and compare them with your future plans to implement a flexible software solution that grows with your business. Reach out to us by filling out our online form, emailing us at info@tauruscpas.com, or calling us at 410-465-4600.