23 Sep 2012

Record Keeping I: a painful job for the small business

by Darren

No matter what kind of business you run, you are required by tax law under all jurisdictions to keep financial records.&

There are a number of benefits to keeping accurate and up-to-date records:

From a tax perspective:
It saves you time at the tax year end rather than scrambling through thousands of receipts and determining if an expense is tax deductible or not.
If you use a tax advisor that charges by the hour less time and money spent by being organized.
You can be confident that you're only paying the tax you owe.

From a general business perspective:
Record keeping helps you know how much and when you are required to pay your suppliers and when your client are due to make payments to your business.
Your business records are constantly up to date so if you find potential investors you have the correct level of financial data available to them.

So how do we solve the mundane task of record keeping?
You can employ someone part time to maintain your books and records at a fee which is a valid tax deductible expense.
Develop your own financial record keeping system - I will provide templates and ideas to help ease the burden in future posts.
Purchase a simple small business accounting system.

Next entry: Record Keeping II - What kind of records should you keep?
Previous entry: Deductibility of Singapore Travel Expenses


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