If you’re self-employed but new to self employment, then you might be wondering how to keep track of all your self employment expense and income documents. Some self-employed individuals are paid through some type of payment system such as PayPal.
However, some self-employed individuals are paid by the clients themselves through online banking transactions or other forms. When this is the case, there is nothing keeping track of your payments other than your bank records. If you fall into this category, then you’re most likely trying to figure out how to keep track of all your self employment expense and income paperwork.
Continue reading below for our guide on how to do just that before tax season arrives!
Your first step is to organize everything! Ideally, this is something that you’ve been doing since you became self-employed. Staying organized helps you find important documents in a quick manner.
The responsibility of keeping all documents organized is yours only. Create a filing system that works for you. You should have a filing system where you store all hard copies of receipts, invoices, and other paperwork.
You should also keep digital copies of everything. Store everything in a way that works well for you.
Keep everything for up to 3 years before discarding it. Never toss out receipts or invoices of any kind. Keeping copies of everything is the only proof you have when it comes to tax season.
This information also comes in handy when making large purchases and so on. You never know when you’ll need a copy of something regarding your self-employment, so be sure to have everything ready to show. We suggest investing in a scanner that would allow you to easily make copies of everything.
Track All Expenses
Keeping records of your income is essential, but so is keeping track of all your expenses. When tax season does arrive, you’ll want to have proof of all the expenses it took to run your business. Your supplies purchased aren’t the only expense that you can deduct.
Everything and anything used to run your business qualify as an expense. This could include gas money, electric bills, internet, your laptop expenses, and more.
Use a Paystub Generator
It’s important to use all of these steps when wanting to keep track of expenses and income for self employment. However, to make things a bit easier for you, consider using a paystub generator. A paystub creator online can help you keep track of your income and even your expenses.
Once you create your own paystubs online, you then have a paystub that will show your income for the week, month, or however, you’d like to lay it out.
Properly File All Self Employment Expense and Income Documents!
If you’re new to the self-employment realm, then you’ll want to keep these tips above handy. Properly file all self-employment expense and income documents to ensure that nothing is left out or lost.
If this post was helpful, be sure to take a look at some of our other posts as well!