Dump the shoebox! A guide to organising receipts and invoices

Today is the start of a new financial year. Like any new year, it’s time to make a few resolutions. The first? It’s time to find a better way of storing your accounting documents.

Do you have bits of paper and receipts all over your desk, on the dashboard in your car, in your briefcase or your toolbox? Or, like a lot of small businesses, do you have year’s worth of records in shoeboxes? It’s time to get organised and dump the shoebox.

Option #1: Going digital

If you’re at a restaurant with clients and you’ve just paid the bill, instead of shoving it into your wallet, you can photograph it straight into an app on your smartphone. The bill then gets uploaded, and the data such as the supplier’s name, the amount, the tax amount, and the date are extracted into an expense category. The app then feeds them straight into a cloud based accounting software program. Let’s take a look at one popular tool called Shoeboxed.

As the name infers, this app gets rid of the ‘shoebox’ system. It integrates with MYOB, Evernote, Salesforce, Batchbook, Constant Contact and dozens of other productivity programs.

Here’s how it works:

• Send in your receipts, invoices, quotes and documents by post, mobile app, email, scanner or direct upload.
• Data is extracted, categorised and uploaded into your secure account online, and it’s human-verified.
• You can then access and export your documents and data into your accounting platform of choice, or leave everything in Shoeboxed as a searchable database.
• You can even have all those business cards you’ve collected collated into a usable database.

There are a few more handy apps you can try out including Receipt Bank and InvoiceSmash.

Can’t decide which one is right?

It’s important to check out the differences in the products as well as their plans. For example, you might like to consider these options:

• Do they store, destroy or return your original documents?
• Are they registered with the Australia Taxation Office (ATO) as a digital document storage facility?
• Do they have an audit protection plan for document recovery?
• Is there a limit to the amount of data you can send?

Even though you will need to double check that the entries are correct before sending it to your accountant, these apps will really streamline your recordkeeping and make your filing a lot simpler.

Option #2: Better record keeping and filing system

If you still prefer the old tried and true method of the shoebox, why not get a filing system for your records and original receipts that has some order about it? The ATO requires you to keep receipts for five years in most cases and payroll information for seven years.

If you’re going to use a paper-based filing system, consider these options:

• Keep things sorted per financial year — or per quarter or even monthly. This really aids in finding things when you need them. Monthly filing of receipts and invoices makes it easier to recall items.
• If your business is on a small scale, consider having one concertina file or folder for each month — this way it’s all in the one place.
• Make sure the folder and file titles make sense to you, such as ‘Vehicle’, ‘Rent’, and ‘Insurance‘. Keep a minimal number of titles, including a miscellaneous title. You can nest files within a folder if needed. For instance, an Insurance file may hold folders for multiple types of insurance.

To help you make sure you’re fulfilling your tax requirements, the ATO have a nifty Record Keeping Evaluation Tool that lets you decide what records your business should keep. It also evaluates how well your business is keeping records already.

It all comes down to you. This year, are you ready to dump the shoebox yet?