Photographers have the skills and techniques to manage the creative aspect of a business. However, financial tasks, such as invoicing, tax payments, payroll, and purchases, are also crucial. If you get confused with these things, here are eight accounting tips for photographers, so you can focus on your passion without compromising finances.
Recording transactions, setting an invoicing system, hiring an accountant, understanding business taxes, and sticking to a bookkeeping schedule can help better manage your business cash flow. These simple accounting tips are great for any photographer who wants to spend more time taking photos than dealing with numbers.
Automate As Much As You Can
Compared to cash transactions, automation minimizes risks of computing errors. Whether you want to find better ways of selling photography prints or get real-time payment integrations, payment automation can improve your accounting productivity.
Develop an Efficient Invoicing Method
Not getting paid correctly and on time are among the most common accounting problems photographers face. Create an invoice that allows clients to see and understand important financial information like amounts payable, due date, and payment options.
You can do this by using a client management software or attaching invoice PDFs in emails. Additionally, send invoice reminders, and stick to your payment policies, so that you can collect the money within your expected timeframe.
Learn Business Taxes in Your Area
As a business professional, it’s your responsibility to pay taxes quarterly or annually to avoid penalties. Taxes vary in every area, which can be confusing at some point.
Read up on all relevant information regarding taxes, like income, sales, property, payroll, federal, and even tax breaks. If you feel like the process is too complicated, you can always seek help from accounting services.
Record Your Financial Transactions
Organizing your expenses is an easy way for photographers to do accounting. In effect, you can avoid debt and income drops.
- Assets: What your photography business owns, such as cash-on-hand, equipment, and payable bills from clients.
- Liabilities: What you owe, like loans payable, unpaid invoices, and revenue for services you haven’t done yet.
- Revenue: Income you earn through sales consisting of photoshoots, studio rental, photo editing, or photo prints.
- Expenses: Money that goes out, typically for utilities, software subscription, marketing costs, and employee salaries.
See What Bookkeeping Practices Work for Your Business
Most businesses use automation to minimize accounting errors. One way to do this is to use an online accounting service or bookkeeping software. As long as you have an internet connection, you can manage your finances anywhere and anytime.
If you don’t feel comfortable storing financial information online, you can keep it old school by using an accounting ledger. However, this may consume a lot of time, especially if you lack proper bookkeeping knowledge.
Hire an Account
There are times when it’s better to let specialists handle some aspects of a photography business. In this case, it would be wise to outsource bookkeeping to an accountant or online accounting service.
While it can be costly upfront, think about how much time, money, and effort you can save in the long run when your business does accounting correctly and legally.
Schedule Time for Bookkeeping
You may experience different kinds of financial transactions throughout a year, so don’t wait up to the last minute before you record them. Dedicate a time per week or month to update your business finances.
Separate Your Business and Personal Expenses
When you’re starting, using personal bank details may work. However, it can result in long hours of separating your business transactions from personal expenses or accidentally spending money dedicated to business operations.
Opening a dedicated bank account makes it easier for you to request bank statements, and consequently, keep track of all finances.
Regardless of how you manage your finances, keep in mind that accounting is essential in keeping your photography business successful and profitable.