Small Business Bookkeeping Tips #1
Online Business Bank Accounts
This first of the small business bookkeeping tips is something many small business owners still get wrong by not doing.
All new business owners should make it a priority to open a new bank account for their business, preferably an account with online access, to keep business funds separate from personal funds.
You do not want to be processing transactions for your personal expenses within the bookkeeping of your business, it's a waste of time.
It’s even worse if you are outsourcing and paying a bookkeeper to process your accounts with these personal expenses mixed in…
… And they will have to be processed if they are mixed up with the business transactions. What do we mean by processing? We simply mean they have to be entered into the bookkeeping system and coded to drawings. Seriously, what’s the point?
If you need to use business money for personal expenses, just do a bulk transfer to your personal account on a regular basis like once a fortnight so that the bookkeeper isn't having to deal with a million small personal transactions and making you pay for their time.
Also, open a business savings account and set aside money from your business earnings every month to pay tax at the end of the financial year.
Bank accounts with online accessibility is definitely the way to go now. It is quicker and easier to login online to make payments and keep up with the bank reconciliations in your bookkeeping software, than to wait for the bank to post a statement, or writing out cheques to make payments.