From A to Z: Your Complete List of Business Expenses

There are many types of business expenses. From a small business owner to a bigger company, the list of expenses keeps growing, and it can be challenging to keep track of everything.

In this article, we will list from A to Z the different expenses related to a business, some more obvious and others less known. Whether you're a self-employed individual or the owner of a well-established SME, you'll find information here about various categorized business expenses that may apply to you.

We'll start by understanding what a business expense is and what criteria it needs to meet to be considered as such. Then, we'll discuss the benefits of expense management, and finally, we'll share some tips to help you with this task.

What is a Business Expense?

A business expense refers to the different costs associated with running your business. These expenses are meant to generate revenue or maintain business activity.

What are The Criteria?

Although each country has different regulations and laws, we can have some indications. Generally, for deductible expenses and credits, it must meet these criteria:

• Directly related to the business operation: The expense must be used exclusively for business purposes. It can be raw material costs for a manufacturer or advertising expenses for an online business.

• Necessary to generate revenue: The expense must be essential or valuable for generating revenue. Fees, software costs, and travel expenses to meet clients are part of this.

• Justifiable by documents: The business must be able to justify each expense with invoices, receipts, or other accounting documents.

• Reasonable: The expense should be reasonable within the business activity and industry.

In summary, it is an expense used for business purposes only and must be justified and reasonable.

We recommend consulting an accountant or the relevant government website and checking the country's tax regulations and deductible business fees.

The advantages of tracking business expenses

There are many advantages to rigorously tracking your business expenses. Whether for daily management or making important decisions, here are some of the main benefits:

Informed decision-making and budget optimization

• Identification of the most significant expenses: Knowing your company's essential business expense categories allows you to identify which sectors need a larger budget and make informed investment decisions.

• Tracking unnecessary or excessive expenses: Spotting superfluous expenses or deviations from the initial budget.

• Performance evaluation: Expense tracking allows you to evaluate the company's performance and measure the effectiveness of implemented actions.

• Getting better rates: Tracking lets you know your budget and have a precise vision of revenues and actual expenses to negotiate with suppliers or make agreements adapted to the company's needs.

• Aid in strategic decision-making: Data collected through budget tracking can serve as a basis for making strategic decisions, such as launching new products or investing in new equipment.

Improving profitability

• Profit margin calculation: Knowing your common business fees associated with designing products and services makes it much easier to calculate your company's net profit.

• Identification of profitability sources: Tracking allows you to determine which products or services are the most profitable and to lead the company's efforts accordingly.

• Cost reduction: Keeping a detailed log of your business budget is an effective way to implement actions, reduce costs, and improve profitability.

Cash flow forecasting

• Anticipation of working capital needs: Tracking and categorizing expenses helps you plan for future cash needs and avoid unnecessary stress.

• Improvement of cash flow management: You can optimize your company's finance management by having a clear view of cash inflows and outflows.

Tax compliance

• Justification of tax-deductible business expenses: Rigorous expense tracking makes it easy regarding tax season or verification.

The list of business expense categories

Merchandise Purchases

• Cost of acquiring products for resale

• Purchase of raw materials for production

• Transportation costs related to these purchases

• Customs duties for imports

• Storage costs for goods

Insurance

• Professional civil liability insurance

• Property insurance (premises, equipment)

• Business interruption insurance

• Cyber risk insurance

• Company vehicle insurance

Social Benefits

• Complementary health insurance

• Company pension plan

• Employee assistance program

• Additional paid leave

• Profit-sharing

Charity and Donations

• Financial donations to associations

• Corporate sponsorship

• Sponsoring charitable events

• Donations of products or services

Communication

• Phone plans (landline and mobile)

• Internet subscriptions

• Video conferencing services

• Business telephone systems

• Internal communication tools

Business Start-Up

• Incorporation or registration fees

• Initial market studies

• Notary or lawyer fees for starting a new business

• Trademark or patent filing

• Creation of visual identity (logo, graphic charter)

Travel

• Fuel for company vehicles

• Vehicle maintenance and repairs

• Parking and toll fees

• Public transport subscriptions

• Vehicle rental for occasional trips

Maintenance and Repair

• Maintenance of production equipment

• Premises repairs (plumbing, electricity, etc.)

• Maintenance contracts for elevators, air conditioning

• Regular cleaning and maintenance of workspaces

• Updating and maintenance of IT systems

Business Supplies

• Tools and equipment specific to the activity

• Consumables related to production

• Personal protective equipment

• Packaging and conditioning material

• Specialized cleaning products

Office Supplies

• Paper, pens, notebooks, binders

• Ink cartridges

• Small office equipment (staplers, hole punchers)

• Office furniture

• Office lamps and lighting

Management and Administration

• Salaries of managers and administrative staff

• ERP, CRM management software

• Training of administrative staff

• Costs related to management meetings

• Strategic planning costs

Professional Fees

• Accounting and audit services

• Legal advice

• Management or strategy consultants

• Technical consultants

• Recruitment services

Interest and Bank Fees

• Interest on loans and credit lines

• Account maintenance fees

• Transaction commissions

• Fees for special banking services

• Costs related to bank guarantees

Delivery and Shipping

• Transportation costs for sending products

• Insurance on shipments

• Shipping packaging

• Customs fees for international shipments

Software

• Software licenses (office, design, etc.)

• Subscriptions to cloud services

• Custom software development

• Updates and technical support

• User training for new software

Rent

• Office rental

• Rental of storage spaces or warehouses

• Rental charges (water, electricity, heating)

• Rental of material or equipment

• Co-ownership fees

Marketing

• Market studies

• Marketing content creation

• Participation in trade shows

• Digital marketing (SEO, SEM, social media)

• Marketing analysis tools

Permits

• Operating licenses

• Building or renovation permits

• Authorizations specific to the business sector

• Annual permit renewals

• Regulatory compliance fees

Advertising

• Advertising campaigns (TV, radio, press, billboards)

• Online advertising (Google Ads, social networks)

• Production of advertising material

• Product placement

• Evaluation of advertising effectiveness

Meals and Entertainment Expenses

• Business meals with clients or partners

• Organization of events for clients

• Participation in networking events

Salary

• Gross salaries of employees

• Bonuses and incentives

• Overtime

• Employer social charges

• Paid leave indemnities

Services

• Cleaning services

• Security and surveillance

• Outsourced payroll services

• IT support

• Translation or interpretation services

Business Travel

• Plane tickets, train tickets, or other transport

• Accommodation (hotels, rentals)

• Daily allowances for meals

• Car rental on site

• Visa fees and travel insurance

Important: It is always safer to check whether these business expenses are eligible for tax deduction depending on the country where the company has to pay taxes.

Tips for tracking business expenses

Here is a simplified 6-step guide to easily track your business expenses:

1. Business bank account: Having a business credit card and bank account to distinguish between personal and professional expenses reduces errors and improves organization. Moreover, the task becomes much easier when it's time to do the accounting.

2. Expense tracking tool: Choosing an expense management software or a tool that suits your needs is essential. Some can have too many features for small businesses and startups; others are too complicated and pricey. No matter which tool you choose, it should help you simplify tracking.

3. Budget and cash flow: An overview of your business income and expenses in the long term is an advantage. Planning the budget and realizing the cash flow can be demanding regarding the company's future. Still, you will be better prepared if you can anticipate your company's finances.

4. Keep receipts: Use Booky to organize all your receipts in one place, categorize, add a date, or filter by invoice number. Find a system that works for you and your business.

5. Create your tracking routine: Develop a process that suits you. Whether you have 5 minutes a day or wait for a specific date, the important thing is to stay regular.

6. Tracking for employees: If you have employees, establish clear rules to track the office expenses. Who does what, when, how?

Whether you or your business uses software or good old pen and paper, choose a system that works for you. Don't hesitate to try new methods and experiments or even adapt over the years.

Of course, we have to promote ourselves here... If you want a simple but effective application that is affordable, Booky is here for you!

Master your Expenses & Boost your business!

There you have it! You now have valuable information about business expenses in your hands. From A for Advertising to Z for... uh, Zoom (that counts as a communication expense, right?), you have everything you need to become a pro at expense tracking and tax returns!

Remember, doing your business tax and managing your costs and revenues is more than just a chore to please accountants. It's mostly the secret to keeping your business in good financial shape and making informed decisions. It's like a regular check-up for your company!

Now, put all this into practice! Whether you're the type to write everything down on a piece of paper or prefer a super handy app like Booky (we're just saying), the important thing is to find a method that works for you and stick to it.

Be patient, experiment, and don't hesitate to adapt your methods over time. The essential thing is to stay regular and organized.

So, get your calculators (or your favorite app) ready and good luck!