Business plan books and records
For instance, set up a savings account and squirrel away a percentage of each payment as your self-employed tax withholding.
This should be part of the induction and training when new staff learn their job. There is no point in recording information for its own sake and records must be used if they are to have any value.
Right from the beginning, you should establish a system for organizing receipts and other important records. Your income from the corporation is taxed as an employee.
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Learn how to manage your books 1. Among the advantages of manual accounting is the independence from machines. Sales invoice file If you use an accounting package, you can use them to issue and store invoices. Similarly, the time and effort spent in keeping records must be related to the scale and profitability of the business. Payroll Records must also be kept regarding the salaries you are paying to your staff. Right from the beginning, you should establish a system for organizing receipts and other important records. For most small businesses, the business checkbook is the main source for entries in the business books. Cash book The payments into and out of your bank account. This will be required for each bank account. The owner or manager should also ensure that all records are kept up to date and where appropriate, the arithmetic is checked for accuracy. You may well find that using a suitable accounts software package takes much of the pain away. Thankfully, your receipts also provide a paper trail of your business activities while away. Figure
While it is true that some successful entrepreneurs keep all of the information in their head and do not keep records, no-one else can help run the business during times of illness or absence.
Cash Receipts Book This is a list of all cash received and an explanation of where the funds have come from, for example, debtors, loan, etc. For American store owners, international purchases are tax exempt as well. The right bookkeeping solution means you can invest more time in the business with bookkeeping no longer on your plate, and potentially save the business money.
Self-employed people need to withhold taxes from their income, and remit these to the government in lieu of the withholding that an employer would normally conduct. Before you talk to a bank about opening an account, do your homework.
The examples given below have been found to be successful in small food processing enterprises in Africa and Asia. Your recordkeeping system should also include a summary of your business transactions.
Apart from combating the risk of fraud or a mistake by your bank, you will gain a better understanding of where you are spending money.
How to start keeping books for a small business
Cash book The payments into and out of your bank account. You may well find that using a suitable accounts software package takes much of the pain away. Bank Statements All bank statements from all your accounts should be maintained. In addition, the VAT element must be shown separately Debtors Records These books will show at any time what you are owed from your customers. This analysis can be simple or more complex, depending on the information you require about your different products or services. Note these details on the receipt. Apart from combating the risk of fraud or a mistake by your bank, you will gain a better understanding of where you are spending money. File them in chronological order.
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