Bookkeeping

How Important Is It To Your Business To Get…

Well? How important is it? Pretty vital right. So why do so many businesses not follow up on invoices?

We all hate asking for money and let's face it sometimes we have to ask repeatedly but in business we've earned it. If you went out for a few drinks on Friday night you wouldn't get any without having to pay first, dropping the money in next week when you get paid isn't an option. So here's my tips for getting paid:

Get the invoices out within the first 2-3 days of the month, that way even if you are dealing with businesses who do pay-runs on the 26th of the month you're in early and are more likely to get paid that if you send out the invoices on the 20th.
Send statements, they work as a reminder of what's outstanding to you without you having to phone anyone.
Use a red pen if necessary but ALWAYS be polite, there is no reason for bad blood in business and if there is some don't let it be coming from you.
Adhere to your own payment terms, if your policy is to add interest once bills get well overdue then issue a warning with your red pen (politely) prior to adding the interest.
Don't be afraid to pick up the phone, after all you've already supplied the goods or services, you deserve to be paid.
Stop supplying someone if you know they are unlikely to pay, making the bill bigger isn't going to entice them to pay you more.

Do you have any tips on what works for you?

Bookkeeping

VAT Reduction

In July the government announced a number of measures to help Irish people out during the Covid Pandemic. One of these is the reduction of the higher VAT rate for 6 months.

From Sept 1st 2020 to Feb 28th 2021 the higher VAT rate will be 21%

This means that when you are accounting for your VAT in this period of time you need to make sure you use 21%. While this should be clear on your purchases receipts it's no harm to double check that your suppliers are only charging the 21% rate. This also means that you may need to update your Accounting Software with the new VAT rate and make sure that it is charged correctly to your customers.

If you need any help or have any questions on how to do this please don't hesitate to contact us today.

Bookkeeping

Cash Flows & Budgets

Cash Flow is essentially a forecast based on past experience and current knowledge of income and expenses. For example, you know that your electricity bill arrives every 2 months so you can look at last year and work out the average. This is inputted every 2^nd month on the CF. You may need to adjust if your business is seasonal and uses a higher amount over winter for example. Or if you consider heating oil – this generally is an expense in approximately October and January but not in May or August.

Cash Flow always starts with your current bank balance (if you have multiple accounts you may wish to do a Cash Flow on each one or add them together – just remember which you do so that your Cash Flow is as accurate as possible 😊).

When you have inputted your income & expenses then your bank balance will update across each month. What you are looking for here is if at any point it goes red – this is where you need to act. That could mean applying for loans or grants, following up more strictly on outstanding bills or look at your expenses and cut down where possible. It looks month by month.

A Budget tends to be more project focused or annually. You will have similar information as in the Cash Flow, but the projects would have more detail. Depending on your reason for doing a Budget – family expenses, holiday planning, new business plan, new projects in existing business – you will ask varying questions. Though there are some commonalities such as what income have I and when is likely to arrive, known / expected costs, etc. But then the projects / reason for doing a Budget gets pieced in so you need to ask questions like what are you trying to do, when does it need to be done by, what costs are involved, what outside support will be needed & what will it cost, what will your contingency be.

This might seem like a lot of hard and time-consuming work but in the long-run it will set you up so that your home or business runs well and you can avoid any nasty surprises!!!

Administration

5 Tips for keeping up with paperwork

Know your deadlines and plan for completion 2 weeks prior to give time for delays, etc
- Income Tax 31 October
- VAT 19^th of the month after the VAT period
  - Bi-monthly
  - Bi-annually
  - Annually
- CRO Returns – Annually on date of registration
Utilise software – finding what’s best for you isn’t always the best, quickest or cheapest way to do it. These days software pretty much does it all for you, but you still have to input the items and know how to read the reports. They have many great facilities such as Cash Flows, Year on Year Comparison, Project Allocation, RCT reporting, VAT reporting, just to name a few. They do vary in cost from €15 per month upwards but most offer a free 30 day trial so you can look around and get a feel for them first.

3. Do little and often. Block off some time each week (minimum monthly) to take care of the books. That way it doesn’t build up. Make sure this is time during the day when you would be working anyway and not Saturday evening when you should be spending time with family.

4. If you run a business where your van is your office, or even if you have a physical office, get a box and get into the habit of putting all your receipts into it as you get them. Be aware that receipts kept in direct sunlight will fade quicker and if you can’t read them then neither can Revenue if they do a VAT audit.

5. Number everything. Even if they aren’t in date order, if you have them numbered it will be a lot easier to find the one you need in a hurry.

How Important Is It To Your Business To Get…

VAT Reduction

From Sept 1st 2020 to Feb 28th 2021 the higher VAT rate will be 21%

Cash Flows & Budgets

Get your FREE Cash Flow template here and get started today Cash Flow Template

5 Tips for keeping up with paperwork

What tips would you add?

Leave them in the comments below

How Important Is It To Your Business To Get…

VAT Reduction

From Sept 1st 2020 to Feb 28th 2021 the higher VAT rate will be 21%

Cash Flows & Budgets

Get your FREE Cash Flow template here and get started today Cash Flow Template

5 Tips for keeping up with paperwork

What tips would you add?

Leave them in the comments below

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