4 Reasons You Should Always Keep Your Receipts

Posted by Angelica Garcia

Dec 12, 2022 1:36:39 PM

In the world of business, receipts are vital to tracking your financial transactions, whether you're a small business owner or a big corporation. They let you track the money going in and out of your company to ensure that every dollar is accounted for.  But if you aren't taking care of your receipts, they can cause problems for your company down the line.

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In this blog post, you'll learn that your receipts are more important than you think—and here's why. 

FIRST, WHAT IS RECEIPT? 

A receipt is a document that proves you have paid for something. It shows how much you paid, who sold you the item and other important information about your purchase. Receipts are also called sales slips or proof of purchase documents. Sales receipts are often used as legal documents to prove what was purchased, how much it cost, when it was bought and by whom it was bought for. 

WHY SHOULD YOU KEEP YOUR RECEIPTS? 

If you’re not yet keeping receipts, you should start now. Whether it’s a small purchase or a large one, it’s always good to keep track of your spending. 

Receipts can be useful for record-keeping purposes. If you keep your receipts, you'll have a record of how much you've spent for future reference, as well as where and when you spent the money. 

 Receipts come in handy when it’s time to file your taxes: if you want to deduct an expense from your tax return, the only way to prove an expense is if you have a receipt showing that it did. Receipts help you track purchases and expenditures, which can aid in avoiding errors and discrepancies if you are ever questioned or audited. 

 Receipts help you track spending 

  • Receipts are a great way to keep track of your spending. Receipts can help you see how much money is being spent on certain items and how often, which can be useful when budgeting or saving for future purchases. For example, if you notice that you’re consistently spending too much money on a certain item and need to put it on a budget, receipts will give you an idea of where and how much money is being spent.
     
  • Receipts offer a financial history of your spending habits and can help you plan for the future. By reviewing your receipts weekly or monthly, you can see what items were purchased and how much money was spent on each item. Comparing receipts from different categories allows you to see how much you are spending overall, as well as in specific areas. 

  • Receipts also allow people with multiple accounts to compare their spending habits across categories so they know whether they are overspending in one area while under-budgeting in another. 

READ: 4 Signs that Your Business Needs Multi-currency Customer Invoices

 

Receipts are important for tax season and accounting 

  • Receipts are one of the most important tools for tax season and accounting. Receipts are used to track business income or expenses, and they can also be used to help you file your taxes.  

  • Receipts are also the basis for accountants and other professionals who work with businesses and individuals regularly. Receipts are an essential part of accounting because they provide documented evidence of purchases made during a set period of time.  This allows accountants to determine how much money has been spent on various items throughout each month or quarter/year. 

Organize your receipts  

Organizing your receipts is a great way to save time and money. You'll never have to dig through piles of paper to find that one receipt you're looking for. You'll also be able to see exactly how much you've spent and on what, so you can plan better for future purchases. 

To start organizing your receipts, follow these steps: 

  • Gather all your receipts and put them in one place 
  • Sort your receipts by categories (rent, utilities, food, etc.) 
  • Take a picture of each receipt using your phone or computer. 
  • Upload the pictures to cloud accounting software like QuickBooks and Xero. 

Read Next: Cloud Accounting Software Tips for Startups 

 The catch? Keeping receipts isn't just good for tax season. It's something that everyone should do in order to keep track of their spending habits —you can scan them and save them in a folder on your computer. That way, you can find any receipt at any time, and it's easy to update your records if you need to. 

Get a Reliable Financial Expert 

D&V Philippines have Australian tax experts with wide experience onboard to help you fulfill your business obligations. To learn more about our services, contact us today

You can also read our white paper, Investing for the Future: Adopting Cloud Accounting for Your Small Business, to find out our capabilities in delivering cloud-based accounting solutions. 

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Topics: Cloud Solutions, Accounting Outsourcing

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