At Sky Accountants, we believe Xero is the best accounting software package for tradies and service business owners because Xero does all the things you need very well. Xero is cloud based and user friendly so you can access it anytime, anywhere. It gives you great management reporting functionality and integrates with apps seamlessly so you can easily collaborate with users.
Xero for tradies and construction business
Your chart of accounts should suit the needs of your business. If you need more than one revenue account, you can opt for residential and commercial revenue accounts. It may be good to split your sales cost so materials and sub-contractors are separated especially if you’re a tradie that needs to submit a TPAR to the ATO every year.
Connect your bank feeds and do not rely on importing data so you can track customer payment daily in Xero. Your books will be reconciled and you’ll always be update. You should only use business accounts, business credit card or business debit card. You won’t need to keep cash receipts if you stop using cash and use automatic bank feeds instead. Xero will track all your payments.
Open a bank account to keep PAYG accruals, superannuation and GST in and not get caught out at BAS time. You bookkeeper should send a weekly report to keep you updated. You should also connect Xero to a payment gateway like Stripe, Pinch and Go Cardless, which all seamlessly integrate with Xero and help collect money from your customers with just one click. They will send your customer invoices with a Pay Now function so your customers can pay easily and you get your cash faster.
You can also connect to Receipt Bank or Hubdoc and take photos of invoices or receipts. These will be stored in the cloud and synced with Xero. It will reduce data entry time and you’ll be paperless. You can email supplier invoices to the app too.
You also need to check your subcontractors’ ABNs because you’re being invoiced for GST but it doesn’t mean they’re registered. If they are not, don’t pay GST. The ATO will question you if you incorrectly claim GST on your TPAR. It’s good to get professional advice before you set up apprentices’ payroll in Xero. Set reminders for payrates and make sure your apprentices are paid correctly. Check specific allowances, rules and rates for each award.
Focus on your debtors by setting up reminders in Xero or connect with a debt management app such as Chaser to reduce debtor days. Put a good process so you don’t have to chase money. It will be good for your cash flow and business. Make sure your Xero account is always up to date. Xero updates every 12 hours and syncs with bank accounts and manages business finances. Reconcile your invoices, receipts and payments regularly so your management reports are up to date. This will help you make informed decisions when it comes to business finances. You’ll be prepared to see your broker, bank manager or even the ATO. If it’s left behind, the work build up and reconciling will be harder to do. Errors are costly and time consuming.
Get your bookkeeper or accountant to help you manage your reconciliations and Xero. Xero is our preferred accounting software. We are accountants providing payroll, bookkeeping and accounting services to tradies. If you’re a tradie that needs support with Xero, we can help you with our tradie accounting and bookkeeping packages. Get in touch so we can talk about your bookkeeping or Xero needs.
As you look for different ways to grow and improve your business, seeking professional advice could prove to be an important and helpful decision.
You can click here to speak to a business, accounting and bookkeeping firm. We also offer hospitality business consultation and mortgage services. We will give you a call to know more about your needs. We will explain to you how we can improve your business.
We would love to help you formulate investment strategies and streamline your processes to take your business to the next level. Our goal is to help you grow your business, find ways to invest more and increase your productivity.
Phone: 1300 328 855
Office Address: 902 Howitt Street, Wendouree, Victoria 3355, Australia
Postal Address: PO Box 2234, Bakery Hill, Victoria 3354
Phone: 03 97444522
Office Address: 45 Hamilton Street, Gisborne, Victoria 3437, Australia
Postal Address: PO Box 270 Gisborne Victoria 3437