As an independent contractor, it is important to make sure your books are in order. One of the main reasons for this is to make your tax reporting a lot easier and get you back to work as quickly as possible. As an independent contractor, you are responsible for paying quarterly income taxes--which can be an arduous process if you don't know what you're doing. Knowing how much you are paying out and bringing in will assist in getting your taxes paid in a timely and accurate manner and reduce the amount of time spent with your bookkeeper or accountant. Having an accounting system in place will increase productivity and help your business run efficiently. By keeping track of bills, receipts, your net profit and gross profit, and by maintaining a clean balance sheet, you can keep an eye on your money without taking too much time from your day job.
To help get your accounting system up and running, check out a few accounting industry software providers we like to use with our clients:
QuickBooks is now available in the cloud for on-the-go accounting and allows you to import your monthly bank statements directly into the program for ease of use. There are a variety of functions you can use based on your niche for well-documented recording and its easy-to-use interface can help you get up and going whether you manage your books entirely on your own or use an outsourced bookkeeping service. Plus, if you take payments through different online shopping sites, it includes the ability to keep track of your expenses and income from PayPal, Amazon, Etsy and eBay.
Keeping all your receipts together can be a hassle. This program lets you take a picture with your smartphone, catalog it directly with the phone app, and organize based on project, client or another categorization method as you determine. If your business is especially expense-heavy, including lots of on-the-go receipts, you likely run the risk of losing receipts or failing to keep adequate track of your expenses. And the last thing you want to do is find yourself sifting through a box of unorganized receipts every quarter. Tallie can help you manage your receipts as you create them--and syncs directly with QuickBooks Online for seamless data management.
ScanWriter assists with automated data entry directly into QuickBooks, including 100s of transactions from bank and credit card statements, bills, sales orders and invoices. A lot of independent contractors find themselves spending countless hours hand-keying data--which takes up way more time than it is worth. Instead of catching up on data entry on your day off, using an automated system will help you get data entered quickly and correctly (less user error!).
Start encouraging your accounts payable to take electronic payments--and then move your accounts payables and accounts receivables into the 21st century with Bill.com. You'd be surprised how many of your payments can be switched to ACH payments--we help our clients switch to electronic payments for as many vendors as possible to help streamline the bill review, payment and approval process. Whether you're the only person reviewing bills or you're working with a partner or small team, Bill.com can help automate the entire review process for you.
Staying on top of your accounting will save you a lot of time, effort and money in the long run. Finding and utilizing the programs that meet your needs will help make you a successful indepedent contractor. And if you need any help, an online bookkeeping service can help you get up and running, from managing your entire accounting department to assisting with accounting software integrations or specific bookkeeping services.
Wondering what accounting services are available for independent contractors? See whether accounting services are for you.