Accounting and Bookkeeping Tips for Tradespeople
Tradespeople are very busy. Working long hours and having busy schedules means that there is little time for people running a building, plumbing or electrical business to sit down and work out their tax obligations, get compliant, balance the books and organise payroll, these being just a few of the financial tasks required to operate a business today.
This means is that tradespeople generally have several common problems –
- They are paying too much tax due to unclaimed work-related expenses;
- They don’t know where their money is being spent;
- There is no time to do their accounting and tax work properly;
- The business is not compliant, which is a problem given the ATO cracking down on the cash economy and increasing the number of audits;
- They have little idea about their financial standing; and/or
- They are struggling with cash flow issues.
We’ve broken down our top three ways to combat these common trade industry issues below.
What you can do about these common problems –
1. Get trade management software
- Track every job from quote to invoice
- Make the most of every minute with real-time job allocation and tracking
- Estimate and quote jobs quickly and accurately
- Track staff, time and materials
- Invoice easier and get paid faster
BIG PLUS, and this is very important for tradie jobs, you can do all of this on-the-go as most trade management software is available via an app, this saves you time and a lot of hassle.
2. Connect your trade management software with cloud accounting software
Seamlessly connect your trade management software with cloud accounting software such as Xero (which happens to be our top pick). It will make your life easier, and your business accountant more effective. Xero and Tradify easily integrate together, helping you to understand your numbers and manage cash flow, it will help your bookkeeper efficiently manage your books, and will it will provide your business accountant with clear and accurate information that will assist when providing you with smart and informed accounting and tax advice.
BIG PLUS, having and integrating these two types of software will save you time, save your bookkeeper time (time is money!) and will help your business accountant provide you with better advice; advice that can help you save dollars.
If you need help setting up Xero for your business, we can help, give us a call on 9217 2400.
3. Get a business accountant/adviser
[Disclaimer] Obviously we’re a financial services firm that provides business accounting, so we’re tooting our own horn a little here… But we wouldn’t be saying this on paper, for everyone to read if we didn’t actually believe it!
Getting a business accountant is a smart move. You may be a ‘jack of all trades’, but that doesn’t mean you’re qualified to do your own accounting and tax, and why would you want to? You’re busy with more important work. Find an expert to help you save time and money.
Things to look for:
- Find an accountant that wants to save you time, not make you do more work
- Get a fixed price agreement in place so you know exactly what you are going to pay and when, this will help with budgeting and cash flow
- Make sure you get compliant, the ATO is cracking down, audits are on the rise, and this can cost into the thousands of dollars if you’re not prepared
- Make sure your accountant is available to take your call
- Sit down with your accountant and get to know your numbers
- Find an accountant that works for you, that understands your goals and can work with you in a way that makes sense for your business and life
If done, these three things are guaranteed to save you time and make your life easier. Food for thought as your preparing for the new financial year.
MVP Financial has helped tradespeople across WA manage their accounting and tax obligations stress-free, since 1985. We are established, we have experience, and we have a dedicated team of 20+ who are ready to help uncomplicate your business and financial world. We provide valuable advice and tools that will help you organise and manage your business, giving you more time for the important things in life.
If you’re interested in our business accounting and tax services, make a time to chat with us on 9217 2400.
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This article is provided as general information only and does not consider your specific situation, objectives or needs. It does not represent advice upon which any person may act. Implementation and suitability requires a detailed analysis of your specific circumstances.