Separate business and personal finances
Use a dedicated business bank account and payment methods. Mixing personal and business transactions is the single biggest cause of messy books and difficult tax questions.
Record and reconcile every month
- Record all sales invoices and purchase bills in the month they relate to
- Reconcile every bank account with your books
- Match purchase records with GSTR-2B to protect input tax credit
- Review receivables and follow up on overdue amounts
Keep supporting documents organised
Store invoices, bills, agreements and payment proofs digitally, organised by month. Good documentation makes audits faster and helps you respond confidently if a tax authority asks questions.
Review a simple monthly report
A one-page monthly summary of revenue, expenses, profit, cash balance, receivables and payables helps you spot problems early and plan tax payments such as advance tax.
This article provides general information based on the law as understood at the time of writing. It is not professional advice. Laws, thresholds and due dates change; please consult a professional about your specific situation.
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