Small business owners who pay taxes based on a calendar year will soon need to either prepare their taxes or take the records to an accountant or other tax preparer in order to complete their returns on time. Although the actual tax return will need to be filed on or about April 15, estimated taxes will also need to be paid in January for the fourth quarter.
Many small business owners use what accountants call the “shoebox method” of accounting and simply bring their records in a shoebox or other box with little or no organization. They trust their accountant to figure it all out, but the more time it takes for your accountant to organize and understand your records the more they will have to charge you for their services. If your accountant has to actually create a set of records in a computer program in order to calculate your income and expenses; that will take even more time.
It is wise for business owners to use some kind of accounting software to track their sales and expenses and small business owners in the Richmond-Rosenberg area may find training on how to use QuickBooks at the Small Business Development Center located on Lane Drive, (281) 341-5027. If you have not yet started to use business accounting software in 2010, the first of the year is a good time to start for 2011.
Organize your records by month and by type of spending or sales. For example if you have several different types of expenses like utilities, materials purchased for items you make, payroll, payroll taxes, rent, advertising, or supplies make a file for each of these. Check with your accountant in advance to see if he or she would rather have files organized by month or by type of expenditure or sales.
Even if you have recorded your financial information in accounting software, your accountant may still need to look at your invoices and receipts in order to determine if things are correctly classified. Obviously, if you have a large quantity of records that perhaps fill filing cabinets your accountant would need to visit your site rather than you taking in your records to your accountant. If you have a sales register that records and summarizes your transactions then bring that summary as well.
All through the year as you work with your accounting software feel free to contact your accountant if you are unsure as to where to record the transaction in the software. Asking questions during the year will save both of you time later. The time you save your accountant will save you dollars in fees.