As a small business owner, it’s easy to let those digital or emailed receipts just pile up in your inbox and never organize them anywhere. But, if you set up a system, you’ll be able to easily organize your bookkeeping and receipts so that you know right where everything is and everything is in one place for tax season! How amazing would that be?
How many times have you been looking for a receipt that you just know is SOMEWHERE but you can’t find it anywhere and your head is screaming “THIS IS WHY YOU NEED A FILING SYSTEM”!!! Too many times, am I right?!?! I know for me, I sometimes procrastinate on getting a good filing system in order because it just requires more TIME, and we all know there already aren’t enough hours in the day, right?
Well, trust me – getting a good system in order is one of those things that might take a little investment of time upfront but once you’ve created it, all you have to do is implement it and the minimal amount of time it takes to keep it up, is totally worth it in the end! Imagine knowing where every receipt or every financial report is every time! How awesome would that be? Well, let’s dive in because I’m going to show a simple, but effective filing system that you can easily implement in Google Drive.
You can use the free version or the paid version of Google Drive to organize your receipts. In the video above, you will see me using the paid version because our team at Steadfast stores a lot in Google Drive-we need the extra space! But feel free to try this out with the free version to start organizing. It will start to let you know if you are getting close to using up all of your space and if you need to purchase more. But if you are just getting started, the space it provides freely should be enough. Here below is the organizational example. I will go into more detail about each folder as you keep reading, so stay tuned!
Here is the way to organize your receipts in Google Drive:
BOOKKEEPING RECORDS (main folder)
-Bookkeeping / Financial Reports (subfolder)
- 2020
-Monthly Reports
-(1 January- 12 December folders)
- 2021
-Monthly Reports
-(1 January- 12 December folders)
-Budget (subfolder)
- 2020
-2020 YEARLY BUDGET spreadsheet
- 2021
-2021 YEARLY BUDGET spreadsheet
-Contractor Invoices / Payments (subfolder)
- 2020
-(1 January- 12 December folders)
- 2021
-(1 January- 12 December folders)
-Expense Receipts (subfolder)
- 2020
-(1 January- 12 December folders)
- 2021
-(1 January- 12 December folders)
Bookkeeping Records
This is the main folder. Now I am just using this name as a fill-in for this blog. I suggest naming these folder ones of these options *BUSINESS NAME* BOOKKEEPING RECORDS, *BUSINESS NAME* FINANCIAL RECORDS, or ACCOUNTING/FINANCE. If you make this folder specific it will help you find it easier in the midst of all of your other Google Drive folders if you have pre-existing ones. The goal in all of this is efficiency and to save time!
I also want to note that I do not think that you should be duplicating every transaction from Quickbooks or any other bookkeeping software that you use to these Google Drive folders. That is not the purpose of these folders in Google Drive, you should view this as more of a back-up to the records that are already in your bookkeeping or accounting software.
You will notice that I have four subfolders in my main folder. Here is something to take into account- you may only utilize one or two of these folders for your business. Feel free to take this example and tweak it a bit to match what your business needs! You can take away folders or add folders-the goal is to make this custom to your business and have what YOU need to stay on top of your organization.
Bookkeeping / Financial Reports
This is the first subfolder- and in that subfolder, you will find two folders inside labeled 2020 and 2021. I am a fan of using years because with bookkeeping and accounting and taxes in general, we do things on a year-to-year basis. We do this so that if someone comes back to you in 2023 and wants to audit you on something that happened in 2020, you can go back into your 2020 folder and find what you need neatly organized. I highly recommend that you, at minimum, start with years inside your folders.
Inside the 2020 and 2021 folders, you will see another folder labeled Monthly Reports. This other subfolder was created to organize this even more so that it doesn’t show a lot of scattered reports. If you work with a bookkeeper or some type of accounting firm, they are probably providing you with monthly reports on your business. Inside the Monthly Report folder, you will see folders labeled 1 January- 12 December. This is so that you have a place to put your reports every month. The reason I have placed a number corresponding to the month is to keep the folders organized in sequence. Google Drive naturally organizes alphabetically so this tip will keep things in order for you.
Budget
The next subfolder we are looking at is the budget. Within the budget folder, you will see a 2020 and 2021 folder. I am a firm believer in doing yearly budgets for your business. A lot of times we are using budget spreadsheets. There is an option to do budgets in Quickbooks Online and probably other software but a lot of times spreadsheets work better or Google Sheets that stay live and other people can contribute to. In your year folder, you would place in your spreadsheet labeled “*YEAR* YEARLY BUDGET.” Depending on who is doing your yearly budget for you, you can always download a PDF of the budget created and place it in the year folder. The goal is just to get them all in the year they correspond to. You will notice that I did not add monthly folders for the budget folder because you don’t really have monthly budgets, you tend to just have yearly budgets that get tweaked from month-to-month every now and then. But it is smart to stay on top of your budget monthly to see how your business is doing!
Pro tip: You can also create a subfolder for a budget for a course or product you are launching!
Contractor Invoices / Payments
When going inside this folder labeled Contractor Invoices/Payments, you will see 2020 and 2021 folders as well. Are you surprised? Probably not! This is the best way to stay organized. If your business has contractors that you are paying once or ongoing, they are hopefully sending you some type of invoice or PDF, I highly recommend taking those invoices or screenshotting your payment and putting it into these folders. Inside these year folders are monthly folders 1 January- 12 December, because I think it is really important to be able to go back and quickly see. Since contractors use so many different software to send their invoices, I recommend going into the email and saving the invoice as a PDF and uploading it to your Google Drive folder. Pro tip: Get the Google Drive Folder app on your phone for quick uploads!
Expense Receipts
The last subfolder I have is expense receipts and I know this is a big one! Inside this folder are folders with the years 2020 and 2021, shocker right?! And inside these year folders are monthly subfolders 1 January- 12 December to keep your receipts easily accessible! Anyone else an online shopper? I know I am. And although it can be tempting to not take screenshots or download receipts of my online purchases, I need to. Why? Because I don’t know how your email inbox looks, but mine can start to pile up and important things tend to get lost. So, what happens if you get audited and you can’t find your receipt? You’re in trouble. So it is better to just go ahead, take that extra minute to upload that digital receipt and give your future self peace of mind. Pro tip: If you are uploading a picture of your receipt or your screenshot, save it labeled by the date and what it is so it saves you even more time when looking back.
So, that’s it! That doesn’t look too hard, right? Trust me, it will not take that long to set up and it takes no time at all to implement once it becomes routine. Go ahead and give it a try! Also, if you are looking for more bookkeeping tips or info in general, I’d love for you to check out my free bookkeeping course where I tell you all about the who, what, when, where, and why of bookkeeping for your small business.
