Credit crunch 'makes bookkeeping even more important'

Date: 5th August 2008

One of the impacts of the credit crunch is that it has become even more important for small businesses to keep on top of their tax records, an industry expert has said.

Writing on smeweb.com, tax expert Andy Hardy acknowledged that the next deadline for tax returns was still some time away but added that the economic slowdown had made it even more vital that sole traders kept on top of their accounts.

He explained that the law required owners to keep business records for six years and added that maintaining good records "is vital for your business to be successful".

"It may seem like a challenge, particularly when you are first starting out, but keeping your records organised will bring many advantages to your business," the expert continued.

Mr Hardy said that maintaining up-to-date records would help small businesses "avoid paying too much tax" and make filling in tax returns "much easier".

It would also ensure firms did not pay too much tax and successfully budget for their tax bills.

Finally, the expert told the website that it was a good idea for companies to use bookkeeping software as this "will this record your business transactions" and provide "monthly management accounts and cashflow reports".