How To Organize Your Small-Business Records

Businessman sinking in heap of documents

Small businesses are small by nature, but the amount of paperwork they generate is anything but small. Keeping your paperwork organized is essential to running an efficient business, and also to ensuring you can access the paperwork you need when you need it. Here are some tips you can use to make it easier to effectively manage your paperwork:

  1. Go Digital

One of the biggest problems with organizing business files is the paperwork: With piles and piles of paperwork to wade through, you need to be able to organize it in such a way that you can find what you need at a moment’s notice. To eliminate some of this stress, try going paperless — favoring digital files over paper ones —whenever possible.

First, start with bills. Can you turn any of your paper bills into online invoices? This will drastically reduce your paperwork. Consider using a project management app like

Then, move on to receipts and other items you can scan to turn into a digital file. Electronic document management can assist with this. Instead of having to do all of the scanning and digital filing on your own, you can trust a third party to help. Once all of your paperwork is digitized, you will be able to store it on a computer or in the cloud, and easily pull up the documents you need.

  1. Establish Your Filing Protocol

Even if you go digital, you will still have occasional papers to deal with. Melissa Kincaid of Seattle Business Magazine warns, “You will still need a place to keep paperwork and receipts that accumulate throughout the year. Like any other organizational project, it is easiest if you create a system.” An organized filing system ensures you can find whatever you need quickly and efficiently.

To ensure your files are organized, purchase a filing cabinet for all areas of your business. Then, set up a filing system that is easy for others to follow. Finally, insist that filing is done daily or weekly, so piles of paperwork are not allowed to accumulate anywhere in your business.

  1. Eliminate Clutter warns the small-business owner against the dangers of clutter. A cluttered desktop is a place where you will lose important documents and receipts. Make sure that your desktop only holds the supplies you need within reach at all times, like a pencil, phone message book and stapler. When papers come across your desk, make a commitment to file or scan them immediately.

  1. Know What Needs to Be Kept (and for How Long)

One of the keys to organizing small-business paperwork is knowing what you need to keep, and how long you need to keep it. Consider these types of paperwork:

  • Tax records — Talk to your accountant, but plan on keeping tax records for a minimum of three years. If they are digital, keeping them indefinitely is not a bad idea.
  • Income records — Hang on to records that show what you have earned, not just for the tax year, but also so you have proof of income for future loans or lines of credit.
  • Asset records — Documents that you may need for Section 179 of your tax return must be kept for as long as you are claiming depreciation of the asset.
  • Legal records — Ask your attorney about how long you need to keep legal documents.
  • Employment records and contracts — Records that are signed by employees or clients should be kept as long as the relationship or agreement is in place. Be sure to store the original for legal reasons.
  • Purchase and expense records — Keep the records of your purchases and expenses for as long as you keep the tax records for that filing year.

Thinking over this list, it’s easy to see how quickly small-business records can grow. This is why having a system in place is so crucial.

  1. Go Mobile

Apps can make it easier to organize your paperwork, so consider investing in a few that can help your business. Shred Alaska recommends Expensify to keep tabs of receipts and expenses and create expense reports. You will need to find an app that works for your business model, but mobile technology can help you manage your paperwork — if you use it well.

Organizing your small-business paperwork is a daunting task, but by making a few small changes now and getting a system in place, you will enjoy running a business where paperwork is under control.