December 16, 2020
Bookkeeping outsourcing is getting common due to several reasons. While not complicated it is a time taking but very essential service for a business. Buy to Let Landlords are no exceptions. Whether you let out a residential property or commercial property, whether you let out few or multiple properties you need to maintain your books accurately. It will not only help you with your tax, it will also give you a complete picture of your profit by comparing your expenses with your income. Carelessness or ignorance here can lead you to HMRC inspection plus you will not get a proper idea on what your investments have brought you.
Here are 5 Handy Bookkeeping Tips for Buy to Let Landlords:
1. Update Your Books Regularly:
You must update your books every month. If you do not do so and keep waiting for a later time it may become difficult and more time taking that it was. A simple task can become humongous just because it was not done in time. Maintaining your books regularly will help you save time and ensure all is claimed.
2. Business Bank Account:
You must keep your account separate from your business account. If you do not have one you must set up a business account immediately. This is essential to keep a track on your business expenses and easily reconcile your bank. All your transactions related to the property be it rental income or other expenses should be done using this account. This account must have it's debit and credit cards to keep property-related transactions separate.
This will make it much easier towards the end of the year. Imagine all your expenses are also going from the same account. Won’t it be difficult to segregate towards the year-end?
3. Maintaining Records Especially Expense Receipts:
You won’t know your profit unless you keep track of your expenses. Also, if you keep all expense receipts carefully you will be able to reclaim input VAT occurred and thus save on taxes. You need to keep records of all the invoices you intend to claim or have claimed for HMRC may investigate to check the authenticity of the same.
4. Reconciliation Of Your Books:
Many time mistakes are made inadvertently during data entry. It can be confirmed while running it through your bank account. These mistakes can be picked up easily when you match them with your bank account. When you reconcile your bank account with your books, you can even pick up mistakes of your suppliers if they overcharged you or charged you twice. There are many apps available to assist you with the same. Whatever you prefer but matching your expense receipts is just as it can remove common errors of bookkeeping and ensure accuracy.
You must keep all your reports organised and handy. If you have kept all your capital expense reports properly you can offset your expense against capital gains when you sell your property. If you look at your P&L report you would know your net profit after the taxes and other expenses. You can analyse your reports and see where you are spending more. You will get a complete idea which you can utilise to improve your profit. We provide all detailed reports required to our clients.
Looking for a good bookkeeping outsourcing company or a specialised outsourced Bookkeeper working just for you? Contact Doshi Outsourcing to outsource accounting services. We provide outsource bookkeeping solutions along with many other services for a fixed fee.
We provide bookkeeping services to UK accountants and small businesses. Call us to find out more details on our outsourced bookkeeping rates.