You are at the Supermarket and grab some things for your office/workshop, what happens to the receipts? You run into a stationery shop and grab a few items, you tell them you don’t need a bag, but what do you do with the receipt? You run into a hardware store or parts shop and pick up something and they give you a big printed receipt, what do you do with the receipt?
I can give you a million different scenarios where a Small Business Owner is given a receipt that they really need to keep but there is every chance that it goes missing before it gets back to the office/workshop.
Receipts & the Law
The law states that if your purchase is under $75 excluding GST you do not need to keep your receipts. This may excite you and may cause you to start throwing out all those darn little pesky receipts… But before you do, let me ask you something, did you break down the GST and Non-GST portion first before you threw them out?
If you go to the supermarket and buy Milk, Bread, Fruit, and Cleaning Products etc. for your office, then some of those products prices wont include GST. How do you record this if you are going to throw out your receipts?
Receipts & your Car
You go to the Supermarket, Office Supplies Shop, Petrol Station; they all give you little receipts. You go to the Hardware Store or a Small Parts Shop and they give you slightly bigger receipts. You jump back into your car and what do you do with that receipt? Throw it onto the front seat? Put it on your dashboard?
9 times out of ten the receipt wont make it from your car to the office/workshop because it either fell off the front seat onto the floor never to be seen again, or someone jumped in your car and moved it and now its ‘missing’.
Well instead of throwing it out or scrunching it up in your pocket, ‘loosing it’ in your wallet or bag, why not have a little document wallet in your car, which sits down the side of your seat. Create the habit that every time you get into your car, you grab out the document wallet from down next to your seat and you put the receipts in it. They can stay there until you are doing your paperwork next and then be retrieved.
Receipts & your Office
Most businesses get mail on a daily basis. In the mail you will get bills and receipts sent to you. Have two document trays on your desk (or where you stand to open the mail). One tray is for putting paid bills/receipts and the other tray is for putting unpaid bills/invoices. As you open your mail allocate the mail to the tray it belongs to, either Unpaid or Paid. It’s as easy as that.
I would suggest that once a week you go through the Unpaid tray and pay the bills that need to be paid and then write on them when you paid it, how you paid it and ‘file’ it into the other tray that holds the Paid bills/receipts.
Invoices & your Workshop
Quite often you are working on something and you need to get a part delivered. When the part turns up it will always have receipt/invoice with it. I have been there when the mechanic or the busy business owner, grabs the part that they were waiting on and goes off, leaving the invoice/receipt to stay where it was or flutter to the ground.
What you need is a document tray out in the workshop where the receipt/invoice can be put when the part arrives. Then if you need to refer to the invoice later when you are invoicing the client you know where it is. Or later that day when you are packing up you can put those invoices into the Unpaid Invoice document tray in your office.
Recording Receipts & Invoices
At the very minimum the invoices that have been paid need to be entered into either a spreadsheet or accounting program, making sure that the amount of GST on each receipt/invoice is recorded correctly. I would suggest that this is done at a minimum on a weekly basis. The longer you leave it the more bothersome it becomes and the less likely it is that you will do it.
By the time you get around to doing the entering you should be very confident that you have all your receipts either in the Paid document tray or in the document wallet that you have in your car that you can easily walk out to the car and grab.
Filing your Receipts & Invoices
Once the recording of your expenses has happened you then need to file them. The easiest thing to do is to buy a tub with a lid from a stationery shop and put them in that.
I love Lever Arch folders and file my receipts in these alphabetically. I use one folder per quarter. I have clients who have a huge number of receipts/invoices and so they have many folders – A-C D-J K-N O-S T-Z or something similar. Having them in folders that are alphabetically makes it easier to track down a receipt if you need to look something up.
So now you have a simple system to control your invoices/receipts I would love you to go out and set one up, then let me know how you went with it and how you are finding it.
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Question: What do you do that you find useful when keeping/controlling your receipts?