04 May Why receipts fade and 5 benefits of going digital
Ever had to look up an expense from a few years ago only to discover it’s so faded you can barely see it? This is because receipts tend to fade over time. They are typically made with thermal paper that is chemically coated. Heat and UV light can cause fading, and if documents have been stored in a box for years, this usually does the trick.
You can spend your time googling how to make receipt ink reappear and then spend hours reviving your receipts, OR you can start right at the beginning by keeping digital receipts instead. Here are five benefits of going digital.
1. QUICK ACCESS
As mentioned in the above scenario, if you need to find a receipt for any reason, you can easily find it. Rather than going through boxes of files, a simple search in your accounting software, and you have your information.
2. EASY TO STAY ORGANIZED
Many online accounting and bookkeeping programs make this super easy. Every time you buy something, open the program app on your phone, fill in the info and take a quick picture. The receipt is categorized and saved.
3. COPIED TO YOUR BOOKKEEPER
If you use QuickBooks, this information can even be available instantly to your bookkeeper or accountant if you have given them access to your account.
4. TIME SAVINGS
Uploading receipts each time will still take 2-3 minutes, but it saves you 2-3 minutes x 1000 or more at tax time. It all comes down to a choice, want to do the work now or later? Either way, the work needs to get done, so you have to decide what makes more sense for you.
5. CRA APPROVED
Now, if you are worried that going digital will be a problem with the CRA, don’t be. We would still suggest keeping your original receipts and paper documents, but the CRA does accept digital files. If you decide to go completely digital, ensure you have backups of the digital records in a format the CRA can access.
Lastly, we want to reiterate that having your receipts and financial documents easy to access has benefits beyond tax time. It can be beneficial for monitoring the progress of your business, applying for loans if needed, and identifying sources of income.
At Rochon & Associates, we not only provide the essential bookkeeping services for your business, but we also provide QuickBooks training, so if you have questions about how to go digital OR how to move to a digital format in the future, get in touch with us.
We can make sure you are capturing all the essential information in an acceptable CRA-approved format and that you are backing it up or storing paper files properly, so your financial documents are always safe and ready to go.