Last editedFeb 20222 min read
Growing businesses can use payment tracking to keep an accurate overview of all their expenses throughout a fiscal year. It requires diligent recording of every business expense both large and small and will ultimately inform your budgeting and spending plans.
Let’s look closer at why tracking payments is so important for your business.
The benefits of business payment tracking
There are numerous immediate and long-term benefits to tracking your business payments and expenses. These payment tracking benefits include:
Better money management
Tax preparation
Employee rewards and reimbursements
Accurate financial forecasting
Better money management
A business must have good money management not only to stay afloat but to thrive and grow. By tracking all of your business expenses in detail, you will be in a better position to manage your business finances and ensure you have everything you need when you need it.
You will be able to keep a close eye on all the areas where your money is going and make the right adjustments to maximise investment in the business. Maintaining financial awareness like this can be hugely beneficial for your company’s future. You can ensure there is always enough cash flow coming in. You will also be better placed to take advantage of new opportunities when they arise.
Tax preparation
Being prepared for the tax season means having a detailed record of all your businesses expenses throughout the year. Receipts and records will have all been kept or copied and filed correctly through a payment tracking process. This eliminates any stress and panicking when it comes time to prove what you have spent.
The payment tracking you implement will also help you keep an eye on all tax-deductible expenses. Such expenses include telephone and internet bills, work-related travel expenses and bank fees. You should also keep a record of all expenses related to working in and supplying your offices, as well as any expenses incurred for remote working.
While tax season isn’t anybody’s favourite time of the year from a business perspective, payment tracking takes the stress out of the whole process.
Employee rewards and reimbursements
Recording expenses on something like a payment tracking excel template also gives you the freedom to reward and reimburse your employees. The most obvious way this can happen is through bonuses. It could be an end-of-year bonus to make each employee’s holiday season a little sweeter. Or it could be a bonus upon completion of an important project. By tracking your business payments regularly throughout the year, you will always be in a position to reward employees for their good work.
Other ways to reward your employees include team dinners and team outings. An annual trip for a day or two somewhere enjoyable can massively increase team cohesion. Demonstrating your concern for employee welfare is also an excellent way to generate loyalty and increase productivity.
Payment tracking for your small business is the key to ensuring you have the finances to reward your employees in this way.
Accurate financial forecasting
Tracking business payments also enables you to more accurately calculate the operating expenses and profitability of your company. It can be as easy as subtracting your expenses from the total revenue generated each month or year.
Such accurate financial forecasting also helps when it comes to attracting potential investors and convincing them to invest in your company. Payment tracking is the ideal way to demonstrate that your business is financially stable and growing.
We can help
With the GoCardless dashboard, you can view the status of your pending payments. When payment is received, it is automatically reconciled against the invoice. Integrations with major accounting partners also allow users to raise and reconcile invoices automatically.
If you’re interested in finding out more about payment tracking for your business, or any other aspect of your business finances, get in touch with our financial experts at GoCardless. Find out how GoCardless can help you with ad hoc payments or recurring payments.
