Following on from our article last month on what expenses you can and can’t claim, we thought we would give you some advice on receipt tracking. As we explored previously, tracking your expenses is a vital part of managing your company’s finances. It monitors your incomings, outgoings and provides the essential evidence you need when filing your tax returns.
But what is the best way to track your receipts? And can you streamline this time-consuming process?
Here is all you need to know about receipt-tracking for your business.
What is receipt-tracking?
Receipt-tracking is all about saving, storing and monitoring receipts to help you keep an eye on your business’s sales and expenses.
Essentially by keeping hold of your receipts, you can track exactly where your money is going, along with how much you’re earning and spending.
Why is it so important?
Tracking receipts is imperative when monitoring your finances and filing your tax returns.
So, how does it work?
Well, every business must deal with two kinds of receipts – expense receipts and sales receipts.
You collect expense receipts whenever you make a company purchase. For example, if you order stock or raw materials, invest in equipment or pay for maintenance services. Now, some of these expenses will be tax-deductible, but you must keep your receipts as evidence when filing your tax return. Otherwise, you will not be able to claim any tax back.
Alternatively, sale receipts monitor your company’s revenue to ensure you have an accurate written record to verify which tax bracket your business belongs in.
What are the benefits of effective receipt-tracking?
Developing an effective receipt-tracking system allows you to:
- Save time and minimise mistakes
- Present accurate records
- Save time and money otherwise wasted searching for lost receipts or unrecorded expenses
- Create financial reports to improve your business’s overall performance.
It’s safe to say, these monetary and time-saving benefits can have a big impact on your business, so it’s definitely worth investing in an effective receipt-tracking system.
Which is better: manual or software systems?
When it comes to efficiency and effectiveness, receipt-tracking apps and software are by far the best option for your business. Why? Because manual receipt-tracking is time-consuming, costly and far more challenging. (Not to mention it makes you far more susceptible to mistakes.)
With receipt-tracking software, you can scan physical receipts with your phone, automatically extract any necessary information and store it safely online. These same apps can analyse your data and automatically generate expense reports so you can better understand your finances (without becoming a financial expert).
Essentially, this software reduces admin hours, increases accuracy and security, provides 24/7 access to your financial information and reduces waste. What more could you want?
What is the best software for receipt management?
Dext (previously known as Receipt Bank) is the software we use and recommend. It allows you to upload your receipts from your mobile phone, email, computer and other online platforms. It then uses OCR and templating technology to extract all the necessary information from your physical receipts to store it safely on the cloud for a minimum of 10 years.
Dext is also a hub for online accounting. With all your data stored in one place, you can seamlessly integrate your information with other online platforms like Sage.
Let technology take the wheel
So there you go – that is all you need to know about receipt-tracking. Whether you’re still managing manual receipts, or you’ve only dipped your toe into digital software, we hope this article has shown how receipt-tracking technology can transform your accounts and improve your overall efficiency.
If you have any queries, or wish to have a chat about taking a Dext subscription with us. please don’t hesitate to give us a call for a chat.