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UUUUUGGGGHHHH is there anything less sexy to a Lash Artist or business owner than the words accounting or bookkeeping? Seriously, why can’t I just show up, do some bomb ass lashes and then go spend my hard earned dollar-dollar bills ya’ll!?
Because “Uncle Sam” (that’s what we call our government here in the States) will hunt you down, put you in a head lock and force you to give him your first born child if you don’t!
In all seriousness (again, ew!), understanding the basics of taxes and accounting will save you SO much time and money come year end and keep you off of the government’s radar. ‘Cause let’s face it, nothing is more of a buzz kill than when the government sends you a happy little notice that you’re being audited because your business was “red-flagged” (meaning you made a boo-boo and they want their money!).
Here are some basic guidelines of dotting your accounting “I’s” and crossing your bookkeeping “T’s”, and when in doubt… ALWAYS refer to your accountant’s advice. This post is educational and informational, you accountant really is your go-to giver of guidance!
KEEP YOUR RECEIPTS!
If you don’t want to owe additional money on the money you’re already spending to purchase supplies and services that keep your business running then KEEP. EVERY. SINGLE. RECEIPT. on business purchases. Did you buy water bottles to provide your clients? That’s a business expense. Did you buy makeup at Sephora to fill in a client’s brows? (and maybe you’re favorite lip gloss just happened to also be on the receipt) That’s a business expense. Did you go to a conference in Vegas? Your travel, hotel and food (and drink!), hotel can all be written off on your taxes as a business expense! Did you know the mileage you drive every 3 weeks to get your own lashes down can be a business write off to? Heck yes it can be! Keeping track of these business expenses can save you hundreds or even thousands of dollars in taxes.
GET A BUSINESS CHECKING ACCOUNT.
Having a bank account solely for business income and expenses is going to make your life SO much easier in keeping track of your “books” (aka the coming and going of money for the business). You can get a business debit card and use that to make all of your business purchases, you can do online banking and check your balances more often to stay on top of your finances and not over draw, and transfer your hard earned cash from your biz account to your personal account to make paying yourself easy peasy. I’ve used PAYPAL before to keep track of business finances and it links easily to your bank account, but I prefer a physical business to work with instead of solely virtual in case I need to deposit cash.. I’ve also used my personal bank account to manage business finances and that was a little too blurry to keep personal and business expenses separate. It really has been the easiest for both financial management and accounting/bookkeeping to have a bank account solely dedicated to running my business.
ACCOUNTING SOFTWARE.
Worth every penny! I’m able to jump on my accounting software every once in a while (usually 2-3x a month) and categorize all of my business expenses (i.e. ‘Materials and Supplies’, ‘Rent’, ‘Owner Withdrawal’- what I pay myself). I prefer to use Quickbooks Self-Employed which has streamlined the whole accounting process. It tells me how much I’ve spent and earned for the Year (or Quarter or Month) and how much I’ll owe in taxes (either annually or quarterly depending on the frequency you file taxes).
GET AN ACCOUNTANT.
Unless you have a few spare months…or years to spend researching tax law for small businesses, it will be an insanely worthwhile investment to hire a pro. They will save you not only time (and time is money) but they will usually save you more than the fee you pay them! They will help you navigate how to run your business and give you guidance on your state/province/country’s specific laws that affect your business. Let them do all the dirty work of accounting while you do what you’re created to do and that’s start, build and grow a thriving lash business!
LASHPRENEUR LIGHTBULB
Accounting doesn’t have to be overwhelming or intimidating. If you create a system to keep track of your expenses, you’ve won most of the battle right there. Leave the rest up to a professional who can take this off your plate. Bonus tip: Take a photo with your phone of any of your physical receipts and either add it to the transaction in your accounting software (like Quickbooks) or create a folder in your phone’s media library specifically for “Accounting” that way you never lose a receipt!
Having these 4 things in place will help to make tracking the dollars of your business so much easier on you and help you to avoid costly mistakes which might put your Lashpreneur journey in jeopardy!
Do you have an accounting tip that has worked well in your business? Feel free to share/comment below!
Have a good one!
Tara Walsh, The Lashpreneur
