Keep Up with your Web Developer Expenses

Author: Learn Web Development

Keeping your financial expenses on track and up-to-date is a very important part for a successful business. Logging what expenses come in and go out are equally as important. This ranges anywhere from software to hardware and office supplies that you've purchased for your business. Keeping a clear record of what was spent where and your incoming payments can help you make a better business as well as it is useful when tax season roles in.

Why should you do this?:

When you keep a record of what you spend and what you take in on a daily basi, it may surprise you. Having a record of hidden costs like electricity and other hidden costs is helpful to know where you need to cut down and where you should be putting your money. For freelancers, like web developers and designers, you need to know where your money is being spent.

This task is not difficult, and with a little practice, it can easily become a habit. There are numerous programs, free and for purchase, that can help you keep track. You may want to create an Excel spreadsheet or use Quicken; you may even hire an accountant, although that's not necessary. However, whatever you decide to use, you will still need to keep all your receipts to enter the information correctly. Overall, if you begin this practice, it will help you in the long run.

Expense Deductions:

Deductions and claims depend on what type of company you are running. The tax rules differ when you are a sole proprietor compared to a partnership and this effects your deductions and how much you can claim. However, in general, the following rules should be taken into consideration:

1)����� Reasonable expenses. Everything that is necessary and ordinary in order for you to run a proper business. This may be software like Photoshop and DreamWeaver to hardware like an external hard drive or computer monitor.

2)����� Said expenses must relate directly to your business. For instance, if you work at home out of a home office and have an electricity bill, a proportion of this bill will be applicable, but not the total bill.

3)����� The total amount of these expenses must be reasonable in relation to the type of business you are running. Do not inflate the amount at all and furthermore, it should reflect the same amount that others have in the same industry.