In this 2 Minute Accountant episode, we’re going to talk about some tips for accounting that you as a tradesperson can use in your business and that’s going to make life a whole lot easier.
How many times have you lost stuff or it has faded because it is like an old fax paper?
There are some really easy ways of keeping receipts. The first thing is using a program called HUBDOC. Go and check it out.
Need more tips for accounting? Well, another thing you probably don’t know is if you have a Diners or an American Express card, you don’t have to keep receipts at all.
All those charges go on to a tax invoice and that is exactly what you need for the ATO. Diners also have a MasterCard attached to that.
Your normal VISA or Mastercard are not sufficient; your bank statement is not sufficient to claim receipts.
You can also use a thing called Receipt Bank. It’s fantastic, as it can take pics of your receipts, and if you’re hooked up to Xero you can take pictures as well.
If you are tradie and you’re getting a couple of savvies to come and work for you, you have a really big problem whether or not they become an employee or they are a subcontractor.
If they have their own ABN, you have to be careful, because 9 times out of 10 you might be responsible for their workers’ comp and their super.
If they’re a company and running a business, you’re more likely it’s a contractor basis. It doesn’t mean someone with just an ABN is less of a contractor, but the things that you need to jump through from the ATO are a lot higher.
So be very careful: the difference between being just an ABN or an actual subcontractor.
These days the ATO is chasing people very hard for money. They are chasing people for activity statements, payments.
You would be getting phone calls from collection agents. Some of my clients have even got letters saying, “If you don’t lodge this, you could end up with thousands of dollars in fines or going to jail.”
The key message is: be on top of your reporting. Be on top of your reporting and if you’re getting hassled by the ATO, go and have a talk to your accountant.
The world of trade has changed significantly.
Do you want time back with your family? Do you want time back at the pub?
Would you prefer to be spending quality time with your family and your mates at the pub versus doing accounting every single night or doing the paperwork for the jobs?
There are some great companies out there: GO ops, Airflow and a couple of others where you can log your jobs in, track it all day long, give invoices, knit into the back of Xero or MYOB, you can end up getting the bills to the clients straight away and you know exactly where you’ve been and you have got a history of the work you’ve done.
So, systemise, systemise, systemise. It makes your life so much easier. Check it out!