Anyone who starts a new business intends for that business to succeed. Part of making a new business successful, in addition to selling a good product and investing in customer service, is keeping good records.
Good business records allow you to keep track of income and expenses and to accurately analyze the performance of your business so that you can know what’s working and where there might be room for improvement. Good records are also an essential part of a positive relationship with state and federal tax agencies.
Few taxes are more complicated than California’s sales and use tax. As Vice Chair of the Board of Equalization, and a former small business owner, I know how hard it is to follow California’s complicated tax rules. One of the most important lessons to learn is that much of the trouble can be avoided by keeping good records. By keeping good records you can make sure that you pay only the taxes you owe and not a penny more.
Financial experts suggest that a regular practice of record keeping increases your chances of success in business and the accuracy of your tax returns.
Keeping good records is not only a good business practice, but also a requirement. Current BOE policy requires business owners to keep sales and use tax records for four years. This policy protects business owners in case of an audit.
Using a record keeping strategy that fits your business will help make filing your taxes with BOE easier.
For more information, please visit www.boe.ca.gov.