Managing business expenses can be a very challenging and frustrating task, especially if you are not sure how to do it right. There are many methods and techniques for accomplishing it, although everything can get quite confusing when it comes to practice. Dealing with all the costs associated with running your business is often extremely perplexing, but it does not have to be like that. Here are four tips that will help you in the process of managing your business expenses.
Keep Track of Your Incomes and Expenses
There are many companies which do not have accurate information on their sources of revenue and actual costs, which can be potentially risky. All of the departments in a company are closely intertwined, which is why you should know precisely how much money comes from each one of them. Also, it is important to keep track of the expenses of each department, in order to find out whether these costs are necessary in the process of production, or they can be cut. As you already know, taxes have to be paid every year for your business profits. The amount of taxes you owe can be significantly reduced if you keep a record of your expenses, which means that you should properly collect and store all your receipts, and keep them for a specified period of time.
Use Mobile Applications
Numerous technological improvements in the last decade made our lives less complicated, simply because nowadays you are able to run your business just by using your smartphone or tablet. There are various applications and programs which are incredibly useful, starting with Google Drive. It allows you to port any file type from your PC to your tablet or smartphone, plus you get a 5GB storage for free. You can also scan receipts and keep them at your Dropbox account, which is a great way of saving them all in one place. Another great application is Expensify, which helps you manage all your business expenses, scan your receipts and even submit them to employers in the blink of an eye. There are many more helpful applications, and all you need to do is choose the right one for you.
Corporate Prepaid Cards
Another way of managing expenses is by using corporate prepaid cards when running your business. These cards are prefunded, and their holders can spend only the amount of money that is loaded on them. You as an employer can distribute corporate gift cards to your employees, just for the purpose of managing all the expenses that are related exclusively to their business activities. In this way, you can easily keep track of the expenses, with minimal administration. Once your employees spend all the money, you will be able to reload the card.
Keep Personal and Business Funds Separate
This is of crucial importance, especially if you run a small business on your own. You should avoid using credit cards and personal cash for business expenses. It would be smart to open separate bank accounts, because that way it will be easier for you to keep track of both business and personal receipts. Also, if you use an accounting application, you should avoid chaos and keep personal records separate from business ones, too.
As you can see, this whole process of managing your business expenses does not have to be such a nightmare. Keeping track is basically the main thing you have to do in order to succeed in accomplishing this puzzling task. After all, you can always hire a professional to do it for you, if you cannot handle it by yourself. Good luck!
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