Record keeping is a challenge for many businesses, but especially for new and small businesses. If you have recently registered a business learn how to avoid record keeping problems with three simple rules.
- Keep business and personal expenses strictly separate. Open a business bank account, and use it only for business transactions. Do not pay personal expenses from your business account and do not pay business expenses from your personal account. If you need to lend the business funds, write a check to the business and label it a loan. Make a separate deposit with the loan check and write in red ‘personal loan’. If you lend money to your business and don’t make a note, it could be treated as taxable income when you do your tax return, and if you pay business bills with a personal check, there is a strong possibility that some of those expenses will be omitted from the business records. If the business is supporting you, write yourself checks at regular intervals and deposit those into your personal account, so that you can pay your personal expenses from