"Cash In Hand" in business is not ok. Here's why.
EPISODE 15
Notes
We’ve all seen or been tempted by contractors offering services at a discount for cash and while this may not impact you as the customer, if you operate your business this way you can get yourself in hot water.
In this episode, we’re exploring why you shouldn’t be paying for any business expenses with ‘cash in hand’ or paying staff with cash.
This doesn’t mean you can’t use cash in a recorded transaction - you can definitely pay for something in cash as legal tender. But ‘cash in hand’ refers to the situation where businesses deliberately use cash transactions to avoid meeting tax obligations and employee responsibilities.
This is due to there being no record of the transaction. Business owners will end up paying less income tax, less GST and avoid paying superannuation or potentially award rates.
I’ll take you through two examples to help illustrate the ‘cash in hand’ process. We’ll explore paying cash for business expenses and dodging your business responsibilities by paying your staff with cash.
I’ll finish off by giving you a list of reasons why ‘cash in hand’ is not ok in business and the reasons why you should record everything accurately. I hope by the end of this episode I have convinced you to track every transaction legitimately and give you peace of mind that your business is accurate and covered.
About the
Author
Bec is a chartered accountant who worked at Australia’s big firms and banks for 15-years. Faced at a crossroads in her career, she backed herself, left her corporate job and launched Straight Up Bookkeeping. 3 years and 5 staff later, Straight Up Bookkeeping is one of Australia’s leading virtual bookkeeping businesses for creatives, with a mission to free business owners from financial stress so they can grow their empires.
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