Understanding the bookkeeping basics can be a game-changer for busy mumpreneurs juggling nap times, nursery runs and never-ending laundry. If keeping on top of your finances feels like just one more thing on your already overloaded to-do list, we have a solution…
The term ‘mumpreneur’ describes a woman who runs her own business in addition to caring for her young child or children. According to published data, businesses run by mothers with children aged 18 or under generated £7.2 billion for the UK economy back in 2015. It is estimated that by this year (2025), this sector is set to grow to £9.5 billion.
If you’re tired of sorting spreadsheets until the early hours, there’s some good news. Hiring the services of a qualified bookkeeper will help you stay in control of your business finances – because your time is precious, and so are your profits.
Let’s break down the bookkeeping basics for small businesses…
Track every penny
The primary role of a professional bookkeeper is to maintain an accurate record of your business income and expenses. You need to know what’s coming in, including sales, freelance jobs, product orders, etc. Then you must keep track of your monthly outgoings, such as supplies, subscriptions, marketing, professional fees etc.
A bookkeeper will make sure you record everything, even those small payments you make from your personal account.
Top tip: take a photo of receipts as you go and store them in a folder or upload them straight into your accounting app. No more folders full of faded paper!
Separate business and personal banking
While it might be tempting to use the same bank account for everything, mixing personal and business money makes a mess of your finances. One of the bookkeeping basics involves opening a dedicated business bank account (even if you’re a sole trader). This will allow you to track your income more easily while appearing more professional when clients pay you., and will also make your life much easier when calculating your self-assessment tax return.
Control your cash flow
While chasing payments might feel awkward, you deserve to be paid on time. With the support of a bookkeeper, you can keep track of who you’ve invoiced, when payment is due and what you are owed. A bookkeeper can advise on strategies to improve cash flow, so that your bank balance remains healthy throughout the year.
Save for your annual tax bill
One of the most common mistakes made by sole traders is a failure to set aside enough money for the year-end tax bill. You must submit a self-assessment tax return once a year, usually by January 31, and will likely need to pay income tax as well as Class 2 and Class 4 National Insurance. To avoid a nasty shock at the end of the year, one of the key bookkeeping basic involves putting aside 20 to 30% of your income as you go.
Understand your allowable expenses
A qualified bookkeeper can assist with calculating the business costs you can claim to reduce your overall tax bill. These costs include a portion of your household bills (e.g. utilities and broadband), office supplies, technology, software, business mileage, marketing, some food and drink and a portion of your mobile phone bill. Your bookkeeper can help you track and categorise these costs correctly to avoid missing out on legitimate claims.
Need support with your bookkeeping basics?
Crunching the numbers can feel intimidating, but Gazelle Bookkeeping believes sole traders and mumpreneurs don’t have to do it all alone. Whatever your budget and business size, we can create a strategy to ensure you remain in control of your finances without doing every detail yourself. Remember, you’re not just running a business, you’re building a future for your family and that deserves professional systems and support.
Contact us today and let’s make bookkeeping one less thing to worry about.
