Accounting and taxes for self-employed estheticians, nail techs, lash techs, and more.
Navigating Your First Year in Business
Entering the world of self-employment in the beauty industry, like esthetics, nail technology, or lash tech, brings its own challenges, especially regarding taxes and accounting.
If you’re in your first year and feeling overwhelmed, remember it’s okay to seek help from a professional. However, if you’re a do-it-yourself enthusiast or need to be budget-conscious, this guide is for you.
This web page is intended solely for information purposes, and no individual or another third party may rely upon it as tax or legal advice or use it for any other purpose. The content does not provide tax advice to any taxpayer and does not take into account any specific taxpayer’s facts and circumstances. Readers are encouraged to consult with professional advisors for advice concerning specific matters before deciding or taking a position on any tax return.
DIY Accounting: A Manageable Task for Beauty Pros
Contrary to popular belief, managing your own accounting and taxes can be straightforward with the right tools and preparation.
As a self-employed beauty professional, you have the power to handle your finances effectively. Let’s explore some user-friendly accounting software options that can simplify this process.
Accounting and Tax Programs
Cost- $5-$15 month ( depending on the plan)( Discount)
- Intuitive and easy to navigate.
- Excellent for invoicing and time tracking.
- Cloud-based, accessible from anywhere.
- Limited features for advanced accounting needs.
- Higher cost compared to some alternatives.
FreshBooks is a great tool for managing day-to-day financial tasks. It offers intuitive invoicing, expense tracking, and time tracking features. This software is particularly useful for keeping your business finances organized and accessible.
FreshBooks & Your Taxes
FreshBooks, primarily known for its invoicing and expense tracking features, also offers functionalities that can assist with tax preparation, especially for small business owners and self-employed professionals like those in the beauty industry. Here's a brief overview of how FreshBooks can help with taxes:
- Expense Tracking: Categorize and track business expenses for tax deductions.
- Income Tracking: Manage invoices to automatically track earnings.
- Tax Reports: Generate profit and loss statements for tax filing.
- Receipt Management: Capture and store receipts for tax documentation.
- GST/HST Tracking: Handle GST/HST for Canadian users, simplifying tax rate application on invoices.
- Accountant Collaboration: Share financial data with accountants for easier tax preparation.
Cost - $20.00/month (Discount)
QuickBooks provides a more comprehensive approach to business accounting. It's perfect for keeping detailed financial records and offers payroll processing, inventory management, and advanced reporting features. QuickBooks suits estheticians, nail techs, lash techs, or waxers who want a thorough overview of their business finances.
They have a fantastic Self-Employed option, which is super inexpensive. QuickBooks Self-Employed connects to your bank so you can easily categorize income and expenses, capture and match receipts, send invoices, and automatically track mileage so you will be ready come tax time.
- Extensive features for detailed financial management.
- Integrates with numerous third-party apps.
- Suitable for payroll and inventory management.
- Steeper learning curve for beginners.
- Higher cost, especially for the full suite of features.
Quickbooks and Your Taxes
QuickBooks offers a comprehensive suite of tools for managing various aspects of business accounting and tax preparation:
- Expense Tracking: Easily categorize and monitor business expenses for tax purposes.
- Income and Sales Tracking: Track sales and invoice payments to accurately report income.
- Tax Calculations and Reminders: Automatically calculate taxes owed and set reminders for tax deadlines.
- Profit and Loss Reports: Create detailed financial reports, essential for tax filing.
- Receipt Capture: Store digital copies of receipts for accurate expense reporting.
- GST/HST Management: For Canadian users, manage and apply GST/HST on transactions.
- Payroll Tax Management: Calculate and file payroll taxes if using the payroll feature.
- Accountant Access: Share financial data with accountants for streamlined tax preparation.
Empowering Yourself Through Financial Literacy
As a new beauty professional, taking charge of your accounting and taxes can be empowering. By choosing the right tools, like TurboTax, FreshBooks, or QuickBooks, you can make this aspect of your business less daunting and more manageable. Remember, gaining financial literacy is a step towards long-term success in your beauty career.
Books worth reading:
J.K. Lasser's Small Business Taxes 2023: Your Complete Guide to a Better Bottom Line -This is easy to understand and no-nonsense book. A great investment if you do your taxes.
Accounting QuickStart Guide-Learn how to control your cash flow, audit-proof your business, and increase your profits. Accounting QuickStart Guide will teach you the key insights to boost your bottom line in an easy-to-read, informative format.
Blog posts worth reading: