3 Accounting Tips Every Freelancer Should Know

accounting tips for freelancers

3 Accounting Tips Every Freelancer Should Know

The world of work is constantly evolving and changing.

This is especially true when you take a look at how people work now and the rise of freelancing. Offering freedom, a chance to be your own boss and to work in an area you love, freelancing is something more people than ever seem to be doing. Working for yourself also means having to handle all aspects of running a business – with freelance accounting being very important.

But what accounting basics should anyone who freelances know?

Do not mix your business and personal money

When first starting out, many freelancers use their existing personal bank account for business use. While this can seem fine as you become established, it can quickly turn into an accounting nightmare. This is because mixing your business income with personal cash makes it a headache to separate the two.

When it comes to completing a self-assessment tax return, for example, having to spend hours working out which is business income and which is personal can be a real chore. It is therefore much better to set up a separate business bank account from the start to avoid this issue.

Pay attention to your finances

A really good tip for freelance accounting is simply to pay attention to your business finances. From cash flow to expenses and monthly income, you should keep a close eye on this. Of course, this is not always something freelancers who are busy with work or who do not like accounting feel like doing. It is definitely worth taking the time to do at least once a month, so you can keep up with how your venture is performing financially and make any changes needed to help it grow.

Hire an accountant

Perhaps the best tip for most freelancers is to simply hire an accountant. While this will come with some cost, it will actually benefit you in the long term. Outsourcing your accounts to a professional means you get time back to focus on your business and make more money. In addition, it avoids any errors or mistakes being made in tax/payroll returns which could land you with a fine.

Help with freelance accounting in Manchester

If you are working as a freelancer in Manchester and are looking for professional, reliable and expert accountants, let SQK Accountancy help. Get in touch on 0161 706 0444 or contact us, today for more details.

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