As a small business owner, bookkeeping can be daunting. With so many things to keep track of, it’s easy to make mistakes. However, these mistakes can cause issues.
At Hanley & Co. Accountants, this month’s blog looks at common bookkeeping mistakes to avoid. For more information, call us in Staveley, near Kendal on 01539 821869.
Mixing Personal & Business Finances
Mixing personal and business finances is a common mistake that can have significant consequences. It can make it difficult to accurately track your business expenses and revenue, which can lead to missed deductions and overpaying taxes.
Failing to separate business and personal finances can also lead to legal issues, such as a HMRC investigation. To avoid this mistake, you should set up separate bank accounts for your personal and business finances. This allows for easy racking of business expenses and revenue.
Failing to Keep Accurate Records
One of the biggest mistakes is neglecting to keep thorough and accurate financial records. Keeping accurate records is essential for monitoring the financial health of your business, preparing tax returns and making business decisions.
If you fail to keep accurate records, it can lead to a number of issues. Your business may miss out on potential tax deductions and entitled credits, leading to tax overpayments.
Failing to Plan for Taxes
Taxes are a significant expense for small businesses, and failure to plan for them can lead to unexpected bills, penalties and fines from HMRC.
To avoid this, you should ensure that you plan for taxes in advance. Accounting software can be helpful in tracking your tax liabilities and automating your tax payments.
Leaving it to the Last Minute
When running a business, your bookkeeping is probably the least of your priorities. However, leaving it to the last minute can make your Self-Assessment and year end more stressful. Having a bookkeeping routine helps you to record transactions regularly.
Bookkeeping Without Expertise
Doing your own bookkeeping may seem like a cost-saving measure. However, it can lead to expensive mistakes.
At Hanley & Co. Accountants, we specialise in professional bookkeeping services. Using the latest accountancy software, we ensure that you are updated with your finances.
Contact Hanley & Co. Accountants
If you require bookkeeping advice, contact Hanley & Co. Accountants in Staveley, near Kendal. Serving across Cumbria, call us on 01539 821869. Alternatively, send us a message via our contact form and we will be in touch.
