When you’re running a small business, you need to look after every single operational aspect of it. Many small business owners are either unsure of or forget to keep regular accounts of all their business-related activities. If you aren’t doing your accounting regularly, you can face problems when you do your taxes later on. There is a way where you can avoid looking after accounting and tax keeping, and that is by hiring an accountant to do that work for you. If you’re a small business owner who can’t yet afford an accountant, then don’t worry; technology has you covered.
Even if you can hire an accountant, technology has many surprising benefits for you as well. For one, technology that is already available, such as cloud computing, allows you to share and access information with your accountant on a real-time basis. This means that you can ask for advice on vital matters and receive that valuable information within a matter of minutes.
Information technology makes life easier for small business owners when it comes to handling accounting and tax-related issues. Apps and software can help you budget your expenses, track your income and expenditure, secure funding from anywhere in the world, automate point of sale management, and more. It can also make comparing Shop Insurance for small business quick and easy online.
Here are three ways technology is already helping small businesses with accounting and tax-related issues.
1) Managing your income and expenditure
Budgeting is an essential part of running a small business. You need to know how much you’ve made and how that cash is flowing. Tracking your expenses becomes crucial so that you can prevent improper cash flow management.
Accounting apps and software that can help you budget, track your expenses, help with filing taxes already exist. QuickBooks is a popular accounting software that you can start using today to regulate your budget and manage cashflow.
Other than tracking your expenses, accounting and tax-related apps and software can also help you in the following ways:
- Manage expenses: Control how much your small business is spending, prepare your taxes, and send them in on time, moderating the billing process, and more.
- Invoicing and itemization: Improve your relationship with your vendors by regularly monitoring stock and inventory, itemize and categorize inventory easily, and more.
- Automate tasks: You can free up time for your employees by automating mundane tasks such as creating invoices, sending payment reminders, etc.
- Transparency: Any money credited to or debited from your small business account will immediately be visible to you, even if your accountant made the transaction. This increases transparency in your relationship.
Most major accounting software can also be integrated with your tax management software. This means that just by putting in data to your accounting software, your tax calculations happen automatically. Big accounting programs can also be linked to your bank. This way, you can automate payments as well. This is especially useful when you’re paying your employees.
2) Find funding to grow your business
Securing funding is now easier than ever before, thanks to crowdfunding applications like IndieGoGo, GoFundMe, and more. You can reach people from all over the world to secure funding for your small business.
Bitcoin and Initial Coin Offerings (ICOs) offer another emerging way to obtain funds without having to run around town hunting for investors.
You can also obtain loans from other sources, such as friends, family, or investors living in other countries. With cryptocurrency services like BitCoin, you can instantly transfer funds anywhere in the world. The fund is transferred as BitCoin. The cryptocurrency can later be withdrawn as money. You can save on bank processing fees as well and get the funds instantly.
3) Automated payroll and point of sale management
Providing your employees with their monthly paycheck entails more than just paying them what they’re owed. Various administrative and management based tasks keep your back office employees busy and take up time that could have been used to grow your business.
If you regularly employ freelancers or contract-based workers, then your payroll system becomes even more complicated. You’ll have to deal with different pay rates, tax rates, different types of pay for different work, and more details. These complicate the process of providing payment to your employees.
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Instead, modern technology lets you automate some processes so that you can manage to make employee payments better. If your small business accepts electronic payment, then you’re already familiar with digital wallets. If you don’t know what they are, they are online accounts where you can transfer or store money. These are not bank accounts, but some services allow you to keep your funds in the account until you transfer them out.
Services like PayPal have been popular for some time now, and many other alternative payment services have also started. Some of these include Apple Pay, Google Pay, and others. These accounts can be linked to your bank account. A paper trail can easily be accessed that shows you your cash flow at any time if you need it for tax-related purposes.
Your employees will receive their payment in their digital wallet. After this, they can either transfer out the money and deposit it into their personal bank account or leave it in their digital wallet.
New technology can enable small business owners to take control of their cash flow management and better regulate accounting and tax keeping. But the use of the internet always leaves you open to risk from cyberattacks. As a small business owner, insuring your business against all potential pitfalls is essential.