Contracting or freelancing requires you to wear a lot of hats. Relationship-building, keeping track of your time, marketing your skills and actually doing the work. But one of your priorities should also be establishing how you handle your money and setting the groundwork for good habits.

Understand your deductions

Before you start, it’s essential to understand what expenses you can and can’t claim. This means you’ll keep the right receipts and track the right expenses. Figuring out what’s what can be a little confusing as everyone has a different working set up and what you can claim for can vary between industries and occupations.

Talk to our tax accounting team in Sydney about your business expenses from the beginning. This will also help you plan for any bigger work-related purchases that you may need to make.

Get a system sorted

You’ll thank yourself later for setting up a good system now. Getting your expenses recorded and your invoices collated means you’ll be able to spend more time doing the important stuff in your business. It’s not just about saving time keeping on top of your cash means you’re more likely to succeed.

Do your research and choose a system that will work for you. Consider choosing a software platform like Xero, which allows you to record your time spent on projects, capture receipts, and send invoices from your phone. It’ll make everything that much easier — especially when tax time rolls around.

If setting up your books from scratch feels overwhelming, our bookkeeping services can get you started with a clean system so you’re not playing catch-up months down the track.

Stash that cash

When you’re running your own business or working for yourself, it’s important to always keep your tax obligations top of mind. Make sure you have money set aside in a separate account or consider entering into voluntary instalments through the ATO.

One way to budget and keep on top of your business tax is to pay yourself a wage. Keeping your accounts separate also prevents you from thinking of all your business income as spending cash. Remember to also put aside a little extra to cover your holidays and any quiet periods — self-employed cashflow rarely runs at a steady rate month to month.

Talk to us about setting up your finances properly

We can help make this process easier from choosing the right software, to setting up expense tracking, to planning your tax instalments so BAS and EOFY don’t come as a shock.

If you’re new to self-employment or you’ve been contracting for a while and your finances feel a bit patched together, get in touch with our team. We work with Australian sole traders, freelancers and contractors on setting up systems that take the headaches out of running your own business.