Keeping track of your finances is essential to maintaining a healthy and organized business. Especially in todays economy, it is paramount that you have a firm grasp on the flow of money through your car wash business, and doing so can not only save you money, but also keep you out of trouble with the Canada Revenue Agency. But it’s not a simple as just recording incomes and expenses. There are a number of organizational methods and planning practices that can help keep your businesses books looking as fresh as a newly washed car.
1)Track All Expenses
Knowing how much your business is spending may be the most important part of keeping it up and running. ALL expenses must be recorded religiously, regardless of how small the amount. Little purchases add up quickly, and it’s important to be able to track where money is leaking out of your business so you can plug some of the unnecessary holes. Tracking your Car Wash business’s expenses to the penny can also prevent you from missing tax write-offs.
2)Plan For Major Expenses
If you know at some point in the near or even distant future you will have a substantial bill to pay, don’t put it out of your mind until the last minute. Make sure you are reminded about it constantly. This may induce some stress, but a small amount of stress with time to plan and prepare is better than a huge amount of stress when you are scrambling to get a loan at the last minute to pay off the expense. Put these types of expenses on your calendar at least a year in advance, so you can tackle them over time rather than all at once.
3) Record Deposits Correctly
It’s easy to accidentally record some of your deposits as income when doing your Car Wash business’s taxes at the end of the year. Any income is taxed by the government so avoid paying money for non-income deposits by keeping an organized system of financial activities with either a notebook, or a program like Excel or Quickbooks.
4)Set Aside Money For Taxes
Think of your businesses taxes like bills. They are not optional, and not paying them have consequences. Make it easier on yourself by saving up systematically so you can make your payments on time. If you don’t file your quarterly tax returns on time, the IRS can and will levy fines.
5)Review All Financials Every Month
Make it a habit to go over all financial paperwork from the past month, as a final check to ensure there are no loose ends in your business’s books. Print a transaction report and compare it to your bank statement, and run an income and expense report to ensure your car wash business is financially healthy.