Best Ways to Store Your Receipts and Keep Them Organized

How to store receipts

Are you frustrated with the piles of receipts taking up your desk space? Have you ever felt stressed when you couldn’t find an important receipt? Or have you ever lost money just because you threw away your past receipts? It doesn’t have to be like this!

This article will share the best ways to store your receipts effectively, so you’ll never have to worry about them! 

Why should you store and organize your receipts?  

Do I really need to store my receipts? 

This question has probably popped up in your mind many times. You may think once a transaction is successful, there’s no reason to hang on to its receipt.  

But, the answer is yes! Here are the top three reasons why you should store your receipts and keep them organized: 

  1. To get ready for the tax season 

As a business owner, it’s in your best interest to lower your taxable income and increase your potential for a tax refund. The good news is most of your business expenses qualify as deductions with the IRS. However, the IRS will want to see receipts and other related documents to verify that your declared expenses were truly spent for business purposes. That means no receipt, no tax refund! 

See also: Understanding the IRS’s Tax Underpayment Penalty and How to Avoid It.

  1. To reimburse expenses correctly 

Often your employees have to use their own money to pay for something on behalf of your company. They then fill in an expense report to get reimbursement. How can you verify if their claims are genuine or not? Receipts can help you! They let you know exactly when and where the transaction took place. Most importantly, receipts tell you the exact amount you need to compensate. This prevents fraud and unwanted disputes in your workplace. 

  1. To stay on top of your spending 

Sticking to your budget is not an easy job. One effective way to do so is to accurately maintain records of every transaction. By doing this, you can have a clear vision of how much you have spent, what to cut out, and which expenses were not worth the money. Consequently, your overall cost and cash flow management will also become more efficient. 

Receipts are indispensable items to ensure your recordings are correct. They are solid supporting evidence for every bookkeeping entry, providing error-free financial reports and helping you stay in control of your expenses. 

See also: How To Track Business Expenses 15 Best Tips & Tools.

How do you store receipts? 

Now that you understand the importance of keeping your receipts, we will show you the best ways to store them. 

There are two common approaches to storing your receipts: traditional and digital. We will go through each method in detail, and hopefully, you will find the solution you are looking for! Let’s go! 

Storing your receipts traditionally 

Traditionally here means you want to collect and organize the paper copies of your original receipts. Here is what you may want to do: 

  1. Buy stationery organizers 

Buying stationery organizers to store your receipts is never a bad investment. File folders, storage cabinets, tab dividers, binders, sheet protectors, colored pens, etc., are all great tools to keep your paper receipts organized. 

A binder is the most suitable choice if you don’t have many receipts. Place sheet protectors in the binder, then slide the receipts into the protectors. If you have a lot of receipts to keep, get storage cabinets.

  1. Categorize your receipts 

Create a system to sort different kinds of receipts. It’s best to categorize based on the type of expense. For example, keep your utility receipts in one separate folder and office supplies in another. Inside your utility receipts folder, you can create subfolders like gas, electricity, water, etc. 

This will save you lots of time when filing taxes because your tax form breaks down the expenses section into different sub-categories, too. 

Consider adding numerical or colored codes to each receipt to classify expenses (e.g., using a prefix of 111 or using the color red to signify utility expenses). Placing the receipts in chronological order is also highly recommended! All these extra steps can quicken your process of categorizing and finding receipts.  

  1. Avoid piling up your receipts  

Schedule a convenient, regular time to sort your receipts. If you usually accumulate a large number of receipts every month, you may want to spend some time every Friday afternoon to go through your receipts. If you have a small volume of receipts, you can wait until the end of each month. 

Regardless, don’t put the task off and let your receipts pile up!

Storing your receipts digitally  

If you want to leverage technology to store your receipts, Shoeboxed is your best option. Shoeboxed stores your receipts and saves you valuable time. 

Just scan your paper receipts, and the Shoeboxed app will automatically extract all of the important data and categorize them. A team of data experts will verify your extracted data and make immediate corrections if there is an error. Your newly categorized receipt data is then available to check and search anytime, anywhere you want.  

Super easy, right? Quick, secure, and accurate; Shoeboxed definitely changes the game in how businesses store receipts. 

Final thoughts 

Storing receipts and keeping them organized is essential for business expense management. Whether you choose to use traditional or digital methods, make sure you always keep tabs on your receipts. 

And if you want to go digital and save time and hassle, click HERE to save 25% off all Shoeboxed plans for a limited time!