Spring is traditionally the time of annual figures and tax returns.
With the profit and loss account and balance sheet as a backdrop, it is a great time to go through your accounts to see what can be improved or changed and what can be cut back on. Focusing on the following 5 items will help you get a grip on costs and expenses.
Figures and business is like the Taoist pair of yin and yang, two complementary opposites that (should) be in balance with each other. Understanding the numbers and reliable forecasts are the basis of healthy sales and profits.
1. On to paperless administration!
A binder full of invoices and receipts behind tabs is passé. Just as you probably send your own invoices as PDFs, purchase invoices arrive electronically, whether hidden behind a link or not. If you photograph or scan your loose receipts directly, you never lose anything. At least, if you store your files in an orderly, logical place. All you have to do is make sure you have a clear folder structure, possibly with subfolders. Think "debtors; office; stock; telephony, internet and web hosting; car/transportation; third-party purchasing; marketing etc.". This will give you a quick overview of the costs per heading. Your accountant can help you set up your accounts.
2. Increase your cash flow with receivables management
Many entrepreneurs and self-employed people ran into financial difficulties this year as the Amsterdam municipality paid the invoices months late. A client who misses the 30-day deadline is using you as a financier uninvited. Accounts receivable management ensures that you are on top of outstanding bills and your invoices are still paid if the payment deadline has been exceeded. This is important for your cash flow. Because if your customer pays late, this can indirectly cause payment problems on your side. Accounts receivable management provides you with a system that shows you exactly how much money is still outstanding on invoices to be collected.
Tip! Don't be afraid to send a payment reminder. Just look at it from the other side: your customer himself would also like to be paid on time. Think of it as normal customer contact, because that's what it is.
3. List the renewal date of all contracts
Your phone or streaming subscription, your internet provider or cloud storage, gas and electricity, your lease contract, your gym and so on often have an end date with automatic renewal. If you have not formally terminated the contract 1 month in advance, you will be stuck with it for another longer term. While you might not be satisfied with your provider or not use the product or service at all. Just check your account statements to see which direct debits are running. Chances are you'll come across a quick savings.
4. Choose a savings target
Entrepreneurship is about getting ahead. For your taxes, but also for (re)investments or headwinds. Avoid financial stress by building your entrepreneurial wealth and financial independence. As a self-employed person or entrepreneur, you need to build your own buffer and (pension) assets. Not everyone does this equally well. Many self-employed people have a buffer of only a few months. What helps is to choose savings goals, business and personal.
Tip! A good turnover often leads to a higher profit and, by extension, a higher tax bill. Don't be surprised and put extra money aside.
5. Check your collaboration
Monitoring false self-employment has been keeping minds busy for a few months now. As a self-employed person, it is useful to take a look at your cooperation contracts to see who is liable for the retrospective tax if the cooperation is deemed to be an employment relationship. As a client, you can ask yourself whether the agreements meet the requirements set by the DBA Act and Tax Authorities for cooperation.
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NOAB KEURMERK
The Dutch Association of Administration and Tax Experts (NOAB) is a trade association with over 1,050 member firms.
Together, these member administration and tax consultancy firms serve more than hundreds of thousands of entrepreneurs in the SME segment,
focusing on unburdening, guiding and advising entrepreneurs.
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