Computers will never replace people. But I say let them try. There are just some things us humans were perhaps never meant to do so labour intensively in the first place. Bookkeeping tops my list.
Traditionally, bookkeeping was a job for someone semi-skilled. Accounting paperwork used to be processed through double-entry bookkeeping principles, using appropriately colour-coded, money-in and money-out books. It’s an image that just doesn’t fit our age of hoverboards, driverless cars and tourist space agencies. Ok, perhaps we’re not there quite yet, but near enough for bookkeeping to sound like an ancient ritualistic practice.
Mercifully, for some time now, trained and experienced accounts staff in larger and corporate organisations have been using software instead of books. You see, they opened the proverbial vortex to technology before, so now it’s time our sole traders and small businesses did so too.
If that’s you, then you can now manage all your account activities on your mobile devices. That’s right, away with your box of receipts! And you can invoice clients efficiently while on the move, too. Honestly, knowing how easy it really is, it won’t be long before everyone is managing their finances while flying around — literally, perhaps.
Getting an advantage
But you could get ahead. You could have instant reporting figures, enjoy secure automatic bank feeds and have a holistic view of your finances at the touch of your smartphone, tablet or screen. That’s a clear business advantage I’d always recommend.
So often in life it’s not the things you know about that you should be worrying over, it’s the stuff you can’t see. At my company, we use Sage. There are plenty of other cloud-based software package available, but this one really works for our clients.
Take your expenses. You just apply a category, write a description and reference, add a contact, attach a photo of the receipt and it’s done. You can view the receipt in the app whenever you like. For your VAT returns to HMRC, you can easily record a payment or organise a refund. It doesn’t matter if you do standard, flat rate or cash accounting, the app makes simple.
Simplified digital accounts not only tick HMRC requirements, but could also reduce your accountancy costs and give you back time to get on with your business.
Take Lizzy: a client of ours. She’s a mum with a part-time salaried job who earns some extra self-employed money at weekends. Understanding the tax obligations for her self-employed work was proving tough: losing receipts, not capturing earnings, and being unable to see expenditure and profit accurately became common, which meant she panicked when chased by HMRC for her tax return.
Remember, true worry stems from what you can’t see. The stress also kills creativity. Since providing Lizzy with Sage One Start, not only has she been much more organised, but she’s also become much less fearful of her HMRC obligations. For that alone, it’s worth the £5 per month.
The choice for freelancers
Sage One Start software is the perfect choice for freelancers, sole trader and contractors. It allows you to manage your business finances on your mobile – on the move.
Other companies have been using Microsoft Office to handle their sales, purchases and invoices for years. Look, it’s time consuming and it doesn’t tell business owners what they need to know. At Weenie Business Solutions, after consultation, we might recommend Sage 50c. It tracks cash flow in real time (linked to bank accounts), lets you create, edit and send invoices straight from the software, improves stock takes, automatically controls stock levels, manages and submits VAT returns, and gives you an anytime view of profit and loss information.
What would they have made of that a few years ago? Well, if you’ve realised that you could do without being inside all day updating the accounts in what feels like your own little cave of paperwork, then now might be the time to evolve. You weren’t really made to be a troglodyte bookkeeper, were you? I jest.
Making Tax Digital is a key part of the government’s plans to make it easier for individuals and businesses to get their tax right and keep on top of their affairs — meaning the end of the annual tax return for millions. Freedom of our kind from that annual tax-related meltdown: it’s almost here.
In March Budget 2017, the government announced that it would provide 3.1 million small businesses with an extra year (until 2019) before they must keep digital records and send HMRC quarterly updates. Every individual and business now has access to their own personalised digital tax account and these are being improved regularly. Going for software like Sage will only make this transition smoother for you, and your business.
Amelia Bishop is founder of Weenie Business Solutions.
Further reading on tax planning
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