For many entrepreneurs, their own accounting is not one of the most popular tasks. But if you follow certain rules, everything is very simple. Most important is a complete and orderly filing.
Our experience has shown that this can make a tax audit a lot better and the examiner has fewer or even no complaints.
If you have a tax accountant, an orderly bookkeeping will also be very important. You can save money by sorting and handing over the accounting records to the accountant.
However, if he first has to sort the documents received and request further documents, this can be a lot more expensive.
We have listed some tips for you on how to save money and look forward to the tax audit without any concerns.
Create a folder with six tabs.
If you are filing the documents digitally in programs such as “Tax Office Online or Dropbox “, you should also create six folders.
The tabs/subdivisions/folders are labeled with the terms:
- Cash register
- Bank
- Credit card statements
- Outgoing invoices
- Incoming invoices • Accounting evaluations / sales tax advance filing
For
- Contracts and important documents
You should set up another separate folder when you use the output bin/digital bin.
It is also important that you pass on a copy of the contract to your accountant immediately after concluding a contract, that he has the required information and that this does not lead to any queries and additional expenses.
There are various things to note about the individual folders. There is a proven approach; we will give you the instructions.
- Cash register
In this folder / under this tab you can deposit all invoices and receipts of the cash receipts and cash expenses.
The sorting takes place after the document date.
The cash register should never fall into the minus; otherwise, your cash register is not properly led.
Because if there is no money, nothing can be bought or spent. - Bank
In this folder / under this tab; you can arrange the account statements.
The sorting takes place by date ascending or descending.
Please note: there should be no extracts. - Credit Card billing
In this folder / under this tab you deposit the credit card statements and the corresponding documents.
Outgoing invoices in this folder / under this tab, you insert all the invoices that you have submitted to your customers.
Please note: Again, sorting should be done by date.
Important: The invoice number may only be issued once and must be continuous.
Incoming Invoices In this folder / under this tab, you will deposit all invoices that you receive from your suppliers or service providers.
If you have not received an invoice from a supplier / service provider, please ask for it.
You should not forget about online bills and invoices paid by PayPal, as well as bills that you should have paid with your debit card.
Our experience has shown that such bills are often overlooked.
Also, note the sorting by date.
If you have not received an invoice from a supplier / service provider, please ask for it.
Important: The amount paid cannot be charged as an operating expense without an invoice.
- Accounting
evaluations / sales tax advance filing in this folder / under this tab you insert the business evaluations, totals and balance sheets and the sales tax filing declarations (evaluations by the tax consultant).
On the evaluations, you can see if you have made a profit or a loss, and how much revenue and expenses have been.
The advance VAT return shows how much money you have to pay monthly / quarterly to the tax office. - Contracts and important documents
In this folder / under this register you create contracts (e.g. loan or lease agreement) or other important documents that are important for the bookkeeping, the annual financial statements and the tax return.
Keeping things organized will save you a lot of search.
Often you need such documents at short notice.
Further possibility
If you have a bookkeeper with a smaller scope and determine the profit with the income surplus bill, there is also another way to arrange the filing of the documents.
The folders/registers outgoing invoices, incoming invoices, bank and credit card billing are stored together.
The outgoing and incoming invoices should be added to the corresponding account statements. When paying by credit card, proceed accordingly with the supporting documents.
For smaller companies that want to do their own bookkeeping, the bookkeeping software is recommended.
Special feature: The input tax for incoming invoices is always deductible in the month in which the invoice was issued (invoice date).
Example: You have received an invoice for 30.03.2018. The bill was paid but only on 06.04.2018. You can therefore claim the input tax in June or in the first quarter of 2018.
It is best to deposit these documents together with a note in a separate register or directly after the bank statements.
Conclusion
If you follow these instructions and always make sure that the documents are complete and no bills are missing, you save yourself unnecessary time and trouble. You will notice on the accountant’s accounts that your proper bookkeeping has paid off. Examinations by the tax office can also be much smoother and more relaxed.
In principle, this approach will have a positive effect on the financial situation of your company.
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