Hey there! If you’re diving into the world of self-employment, I totally get it—there are so many things on your plate, and bookkeeping can easily fall to the bottom of your to-do list. But let’s chat about why keeping those financial ducks in a row should be a priority. Trust me, it could save you some cash and make your life a whole lot easier!

1. Reduce Your Tax Bill

Did you know that early expenses, like costs you incur before you even start selling your product or service, help you out when tax season rolls around? These expenses—called pre-trading expenditures—can save you money because they’re tax-deductible. Too many businesses miss out on these benefits simply because they forgot to jot them down!

Some examples of pre-trading costs include stock, rent, insurance, professional fees, stationery, equipment, and advertising. If you start recording these expenses using accounting software right away, you’ll ensure you don’t miss anything. Many apps now let you snap a photo of a receipt, and they’ll automatically log it into your accounting software for you. Easy peasy, right?

2. Improve Your Cash Flow

You might think that setting up an accountancy package is a hassle when it seems easier to whip up invoices in Word or even on paper. But trust me, the benefits of accounting software are worth it! Most of them come with handy invoice templates, where you need to enter your customer’s info and the amount. Voilà! Your professional invoice is ready to go!

Plus, the software will do the math for you, which means fewer mistakes. You can even send invoices straight to your clients right from the software. And if any invoices are overdue, some programs will send out automatic reminders, taking that off your plate!

3. Monitor Profitability

By keeping track of your business income and expenses in accounting software, you can easily see how things are going. No more guessing and no unpleasant surprises come the end of the year! You've made a massive leap into self-employment, so it's essential to know where you stand financially.

4. Save on Accountancy Fees

If you let your accountant handle everything at year-end without tracking your receipts and invoices, you might save time, but it could cost you a pretty penny! Accountants often charge by the minute, and during busy times, those rates can skyrocket. Keeping up with your bookkeeping can keep those fees in check!

To Wrap It All Up...

There are plenty of good reasons to keep on top of your bookkeeping. I know it can feel daunting when you’re busy running your own business, but with the right accounting software, it can be much easier than you think. There are so many user-friendly, cloud-based options available now, complete with nifty tools like automatic reminders, expenses apps, and bank feeds.

So, let’s make bookkeeping a little less scary and a lot more friendly together! Happy bookkeeping!