What is Bookkeeping and How You Can Benefit
Bookkeepers who are registered by the Tax Practitioner Board as a
BAS Agent have the ability legally to advise on, process, and lodge
BAS statements to the ATO. For some businesses, getting their BAS
right and having the funds to pay their obligations accordingly can
be a big stress.
If you are a sole trader, a tradie, or running a small business with a turnover of less than $1 million, you are likely to have a number of tax obligations such as GST and BAS, PAYG instalments, and fuel tax credits depending on your industry. If you have any staff, you have the additional requirements of PAYG on your BAS, Super guarantee, work cover, and payroll to deal with as well.
ATO compliance stress is usually on a higher level for those businesses with employees compared to businesses without, due to the extra pressures of PAYG, superannuation and other employment regulations and award conditions.
All of these obligations hinge on your efficiency and accuracy in your bookkeeping and data entry of your invoices and receipts. You are either doing a great job or struggling to keep up. Either way, your time is money, and you earn more and build your business better when you can concentrate on the work you do best, not on the paperwork in the background.
Most small businesses do their own bookkeeping, but there are indications that those who use external bookkeepers have a higher revenue than those who don't. In the simplest context, this could merely be the hours saved by not doing their own bookkeeping put into hours used to earn money. In the cases where sole traders and small businesses are struggling to keep their books organised, or to keep on top of their obligations or have trouble understanding some of the complexities of the bookkeeping process, this could quickly translate into many more efficient money earning hours, and an increase in compliance and accuracy all at the same time.
In a report issued by the University of New South Wales in 2006 studying the costs of compliance of small business, it was noted that the tax returns for small business and sole traders prepared by external accountants ranged from $300 to $25,000 per year. Many businesses reviewed indicated that tax compliance was a 'nuisance' and time consuming and they would rather spend their time running their business. Most businesses who used bookkeepers regarded their the money spent on bookkeeping well worth it, as it increased their time available to run their business and reduced the stress of finding the time and meeting their compliance obligations1.
If you are wondering why it is worth having a bookkeeper still, consider the cost of a bookkeeper compared to your loss of time earning while bookkeeping, and the cost of an accountant to do some of the tasks a bookkeeper can do. Some bookkeeping costs but much lower accounting fees and more time might be a winner for increasing revenue in your business or enabling you to increase your business potential.
So, if you are considering using an external bookkeeper but want to know what the specific benefits to your business might be, contact us and we can drop around for a free consultation to see if we can help reduce your paperwork stress and increase your time on your own business.
We work with the major brands of accounting software such as MYOB, Quickbooks (Certified ProAdvisor) and Xero (Certified Advisor) but can adapt quickly to other brands and versions. Click the below links to go directly to the software websites.
