If you are self employed, chances are one of your problems is finding out how to cut costs. When you incur too much expense in your business, you will not take much profit home at the end of the day; and even if you are sitting pretty, it is always a good idea to know how you can reduce expenses and save money in case something goes wrong in the future.
Know the expenses you can deduct from your tax
As a self employed individual, there are certain expenses you are allowed to deduct when you submit your tax. This is known as tax deductible expenses.
Usually, when you fill for your taxes, the amount you are expected to pay is based on your profit at the end of the year, but because the tax man understands that you will need to make certain purchases that will help you run your business, you are allowed to deduct these expenses, thus lowering your tax bill.
It is vital that you keep a proper record of your expenses so that nothing skips your memory when making your tax filings. These deductable expenses will save you a lot of money every year. Here is a list of some of the expenses categorized as deductable expenses.
Be careful with your credit cards
Your credit card can be a huge temptation, especially if you lack ready cash, but using your credit card for business related purchases can be very expensive. When you use your credit card to buy capital equipment or make very large purchases, you should expect to pay really steep interests, and this is money that can be channeled into other areas of your business. A better option is to consider business financing, or apply for a card that is specifically for business expenses.
Keep track of your expenses
One of the problems self employed people face is the inability to properly keep track of their money and expenses. For one thing, people who run small business typically don’t answer to any boss of board so they may not see any need to keep proper books or records. If this is you, chances are you are making purchases that are not expedient with money that can be used in other aspects of your business.
If you are serious about cutting costs and saving money, then you will need to cultivate the habit of keeping track of your money; fortunately, there are money management apps that make it easy to budget and keep track of your money.
Look for services that offer you more for less
There are dozens of businesses that offer loyalty and reward schemes to their customers. When you buy from businesses like this, over time, you can buy enough that would help you earn a bit which will add up towards your savings and cost cutting programme.
You should know that this works both way though. Creating your own loyalty scheme can help you attract the customers you need to grow your business. When you have more customers, more money will invariably be coming into your business, creating opportunities for more profit. This article covers how to make a loyalty programme work for your small business.