The top and number one reason for keeping your business receipts is because the Internal Revenue Service lists this a REQUIREMENT when claiming business expenses each year.
So say you want to claim an Office Expense or a Business Meal, you will need to keep that annoying little receipt for each of those expenses and each time you incur that expense. They are a pain to keep track of but I promises it will be less of pain if you ever get audited by the IRS and are unable to provide those receipts proving eligibility.
You want and surely deserve every deduction you are entitled to on your tax return, so you must take the proper steps to ensure that you have a system in place to keep track of all of your receipts and expenses.
Many small business owners opt for the shoe box method by simply throwing them in a box and hoping they won't need to sift through them later or they folders to categorize and keep receipts. If this is what you use, and it works well for you, there is no use in changing it.
The main purpose for my blog is to provide valuable information to empower Small Business Owners who tend to struggle in the accounting area of their business. No matter how much you love and are passionate about what you do, the numbers matter. Period.
If you are using an Accounting Software such as Quickbooks Online, you can snap a photo and attach it right to your transaction. Many business owners love this feature because everything is in one place and they can trash the receipts after sending them. Another option would be using a document retrieval software such as Hubdoc or Shoeboxed. These software's digitize, organize and archive receipts into one secure location for one monthly fee starting at $10/month. For my clients, a Hubdoc subscription can be included in the monthly bookkeeping services so that receipts are sent straight to me and I can attach them to the Quickbooks Online account. Whichever option you chose, consistency and organization is key. If you set up a weekly Bookkeeping schedule, it can help you stay on track and minimize tasks from piling up.