It’s time for you to do your taxes for your gym. You start scrambling, looking for important records you’ve gathered throughout the year, but half of them seem to misplaced. If you were practicing proper bookkeeping, this process would have gone smoothly.
You have to keep any documents regarding your gym organized. You also need to keep your personal purchases away from your business ones so you’re not trying to filter through them later. One way you can do this is by performing a self-audit every once in a while.
Does all this sound like gibberish to you? It’s okay, we’ll explain everything. Here are ten bookkeeping tips every gym owner can benefit from.
1. Keep Everything Organized
You want to stay organized throughout the entire year so when tax time rolls around you won’t be tearing your hair out trying to find everything. Gather up any receipts you have along with documents on big equipment purchases.
Not everything comes out perfectly, you’ll want to check your 1099-K forms for accuracy before you report them on your taxes.
2. Keep Any of Your Personal Finances Separate
When you start your gym, you will be responsible for handling your finances. To this end, it’s a good idea to keep your personal finances separate from your business ones. In fact, you want to set up a separate bank account.
Separate accounts will keep you from having to sift through expenses later to find out which ones are personal and which are business.
3. Use Cloud Software
Human error happens when you’re doing your bookkeeping. Using the Cloud cuts down on mistakes. Cloud software automates a lot of your bookkeeping which takes the stress away from you.
Cloud software also allows you to see your finances anytime, anywhere. You can go on vacation or out of town on business and still see how much money you’re bringing in.
Cloud software is efficient but you shouldn’t put all your faith into it. You still want to have an accountant look over it to be sure everything looks right.
4. Go Paperless
The best thing you can do for yourself and your gym business is to ditch paper and go digital. Writing everything down on paper could lead to errors that will cost you time and money later. It’s also less likely that someone unauthorized will get their hands on sensitive employee records.
Computer errors happen, but they aren’t as likely. You’ll be able to upload your employee records to the cloud and import their hours right into the payroll software.
5. Keep Every Receipt
Audits are a normal occurrence when you’re running a business and you’ll need to be ready for them. When they happen, you’ll need to have your receipts on hand so you can justify your purchases.
Receipts are the only way of knowing what you bought and how much you spent. You can’t go by bank statements alone. For example, if you pay with cash, that won’t show up on the bank statement, so you’ll need the receipt.
If you’re scared you won’t be able to keep up with your receipts, there are different programs that can do it for you.
6. Set Up Recurring Billing
It’s no longer feasible to keep a binder that contains your members’ payment history. It’s better to have a recurring billing system.
A recurring billing system will bill each of your members the same amount each month. You’ll always get your money unless their card gets declined.
7. Reconcile Your Bank Statements
When you get busy with running your business, it’s easy to let some things slip through the cracks. Before you know it, you have six months of bank statements you have to account for.
Falling behind causes you to rush through your finances. This leads to errors, such as putting in 1200 instead of 120. It messes with your bottom line and could get you into trouble with the IRS later.
8. Perform a Self-Audit
You don’t have to wait until you have an audit due to perform one. You can do one yourself. It can be something basic like reconciling your documents, or you can do some of the harder bookkeeping stuff.
Either way, doing this helps you do all the checks and balances for your company so you can see where you’re at and answer any questions the IRS may have.
9. Detailed Inventory Records
Maintaining your inventory records helps you keep track of any employee theft and merchandise that has gone missing.
Keeping up with these records can also help you see buying trends so you know what your gym members want.
Bookkeeping Tips that Will Keep Your Gym Organized
If you don’t keep up with your gym’s bookkeeping, it can plunge it into chaos. You need to make sure you’re keeping proper inventory records, keeping up with important reports like bank statements, and performing self-audits to make sure these things are in place. Use these bookkeeping tips to keep your gym in check.
Wouldn’t it be nice to stop worrying about your accounting for good? Contact us to find out how.