If you are running a VAT registered business, there are quarterly returns which act as a prompt to stay up to date. This encourages people to either keep up with their bookkeeping, or get some help.
But with businesses who are not VAT registered, there can be a temptation to leave everything to the last possible moment...
It must be cheaper to just hand everything to the accountant once a year, mustn't it?
Well the benefits of having the bookkeeping up to date are ;
*There is no migraine building in your head from the stress of seeing the piles of paperwork build up.
*You know which customers owe you money, so you can send statements out to those customers who have 'forgotten' to send you a payment.
*If your bookkeeper asks you about a transaction, you can remember what happened if it was a week ago. But if they are asking about something that happened a year ago it can be difficult to remember.
*Your bookkeeper can estimate a rough profit figure part way through the year, so that you know how much you should be saving each month towards your tax bill.
*You can compare this month to the same time last year to see how you are doing. This can help you build a picture of which month makes you the most money.
*If you are near the VAT threshold, you can plan for the time when you need to register as you know how much you have invoiced in the last 12 months at any one time.
*When you hand your books in to the accountant, you will not need to pay them to turn it into a set of books before they start looking at the tax figures.
So having your books up to date can save you money, and help with your cashflow.
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