Why You Should Be Wary of DIY Bookkeeping

So, you’ve recently set up your own business, and most entrepreneurs will agree that the actions you take during these early stages will be absolutely key to your success in the future. And, saving money when starting out will also be a large priority, so it’s no surprise that many small business owners get around this by doing as many things themselves as they can. Jobs like social media marketing, blogging, and even designing your own website can easily be done by yourself today, plus admin tasks, customer service and much more. But, one aspect of your business that can be very risky to do yourself is accounting. Keeping your own books might seem like an attractive way to save some money but it could end up costing you a lot more in the long run.

Do You Have Experience?

Before you decide whether or not it’s a good idea to do your own bookkeeping, you should ask yourself, how much experience do I have? If you have a degree in accountancy and experience in the field, then it might not be such a bad idea. But if you’re like most entrepreneurs and don’t really know the last thing about business accounting, then it’s best to leave it to the professionals. If the very idea of receipts, payments, numbers and tax audits is making you feel stressful, then this isn’t a job that you should try and tackle on your own.

Do You Have the Time?

Even if you have got some accounting experience and are confident that you can do the job well, another important question to ask is do you have the time to dedicate to bookkeeping? Going through all the numbers can be a pretty time-consuming job, and when you’ve got all the other areas of your business to deal with and customers to keep happy, the last thing that you want is for hours of your day to be taken up crunching numbers. Even if you’re using a good accounting software it can still cut into precious time that you could be using to market and grow your business further. And if you’re rushing, there’s more potential for mistakes to be made, which can have disastrous consequences. Whilst tax resolution services are available, you want to avoid putting yourself in a position where you need them because of a small mistake you made when you were pressed for time.

Do You Want Your Business to Grow?

If you’re starting out as a sole trader and running the business on your own, it might be easy for you to do your own bookkeeping during these early stages, as your overheads will not be as high as a larger company. However, if you want your business to grow and start taking on employees, doing your own bookkeeping will quickly become tedious and time-consuming, with more expenses to contend with and employee tax to consider. It might be worth doing your own bookkeeping until you take on your first employee, then consider hiring a professional accountant.

For many business owners, DIY bookkeeping can be a way to save money – but is it really worth it?