Do you need to keep your receipts?
Receipt management tips for Small Business Owners
Though the name may make it seem a bit complicated, receipt management is simply the process of maintaining and organizing the receipts for purchases made by your business.
Receipts could be for anything... an expensive asset or a pack of pens. Your receipts may be printed paper or electronic. Regardless of the form, there are lots of reasons to keep your receipts. So, Yes! You should keep your receipts and here's some reasons why...
If you end up needing to return something, you'll need that receipt. Even if you don't have the original receipt, retailers and suppliers will usually accept printed copies or pictures of the original.
If you have a business that passes along the cost of expenses to your customers, you'll want to have the receipt to support your invoicing.
Occasionally, errors happen. If you make a purchase and a vendor charges more than you agreed to, you'll need the receipt as proof of how much you actually authorized in order to dispute the transaction.
Proof of eligibility for tax deductions.
In the unfortunate event that you get audited, you'll need receipts to support business expenses that reduced your tax liability. You may have heard that bank statements are enough, but they're not. Your bank statements can show that the transaction occurred, but it won't show what you bought to provide context of whether or not the items were actually for the business.
If you need to make a warranty claim on something you've purchased for the business, you'll likely need the original receipt as part of the support documentation for the claim.
OK. But where should you put all of these receipts?
Don't worry, you don't have to keep boxes of messy receipts.
There are some fantastic solutions to maintain your receipts electronically (and within your accounting software) to keep everything organized and easy to access if you need them.
So what digital solutions are best?
I love DEXT! I love it so much, I include it in all of my bookkeeping packages so my clients have access to it without any additional expense.
If you're a QuickBooks Online user and don't want to use an add-on solution, there's also fairly new receipt capture solution built into QuickBooks Online.
Want to learn more about DEXT Prepare? Check out this post!