How to Organize Your Blogging Income & Expenses
I used to work in a public practice accounting firm before I started blogging. I remember clients coming in with huge boxes and garbage bags full of receipts. It was part of my job to organize them and figure out their year end statements and taxes. I hated that part of my job and I said that if I ever had my own business, I would be much more organized! Easier said than done right? Now I do run my own business and I know the ins and outs of bookkeeping so I should really follow my own advice.
2013 is the year I finally decided to get my records in order and for once, I’m not dreading doing my 2014 taxes. I’d already been keeping track of my blogging income and receivables using a handy spreadsheet I made on Google drive. You can get yourself a copy of it too if you like. However, my issue last year was dealing with all my receipts for my expenses. I needed a way to keep them organized rather than just throwing them into a shoebox or envelope to deal with later.
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I found a super simple way to keep my receipts organized so when I go to prepare my 2013 income taxes all I have to do is consult my blogging income spreadsheet and total my expenses. You should be keeping copies of all your receipts anyways in case you are ever audited.
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I’m using an Income Tax Organizer, but any expanding file folder will work. I have a separate tab for each type of expense and that’s where all my receipts are neatly stored. Then when I’m ready to prepare my taxes, I don’t have to sort through the receipts and put them into piles for each type of expense. It saves me an extra step and if you’re hiring someone to prepare your taxes, it saves them an extra step. This will save you money since most accountants bill on time spent preparing your return. The messier your books, the more money you will pay an accountant.
For the individual tabs, here’s what I have:
- Groceries: I claim the ingredients for recipes I make for my site.
- Home Repairs & Maintenance: I claim a portion of these expenses under “In Home Office”.
- Office: Like postage, paper, ink for the printer, etc.
- Income: I file all my cheque stubs here.
- Travel: Hotel receipts, parking fees, plane tickets for blogging related trips
- Credit Card: I put all my credit card statements here. I mostly use my credit card for blogging related expenses.
- Cell Phone: I file my monthly cell phone bill here.
- Utilities: I put all our power, water and heating bills here. I claim a portion of these expenses under “In Home Office”.
- Phone/Internet: Our monthly bill from the phone/net company goes here.
- Government: I keep all copies of correspondence from the government here including my Notice of Assessment.
I need to pick up a new file folder for 2014 and begin the process again for this year. At least now preparing my taxes doesn’t seem as daunting and I’m glad I finally got myself organized! Maybe now I won’t procrastinate and file my taxes on the very last day!
How do you keep your blogging income and expenses organized?
This post was previously published on December 31, 2013 on my blogging blog. I’m closing that blog down and moving the content over here. Keep an eye on my Blogging tips category! Want to start a blog? Read my post about how to start a lifestyle blog.