3 Reports You Can’t Live Without at Tax Time

February 3, 2015


One of the hardest things to do at tax time is actually just getting started. Here’s a guide to the reports you can’t live without at tax time, and how they work.  You can use it as a jumping off point to get familiarized and tackle your taxes a little earlier this year.

Profit & Loss Report
The king of all reports, your P&L, lists all the money you’ve brought in this year as well as all of your expenses—giving you a net profit or net loss.  This is an essential  report come tax time because it contains important information that you’ll need to report on for your tax returns.

In your FreshBooks account, go to the Reports tab and select Profit and Loss from the list – this will generate a report based on the data in your account.  Adjust the settings at the top so your report matches the date range you need and hit the Update button.  Voila! A snapshot of your business over the last year.

Expense Report
While the Profit and Loss report is perfect for an overview, sometimes you need to really dig into the numbers.  You may be asking yourself why your expenses were so high in a certain month, or why you have expenses categorized a certain way.  That’s where the Expense Report will come in handy.

In your FreshBooks account, go to the Reports tab and select Expense Report from the list. This will generate a report of all of the expenses in your account.  Adjust the settings at the top so the report matches the date range you need and the grouping format you prefer, then hit the Update button.

The Expense Report gives you a master list of all the expenses you have listed in your account between the dates selected.   It’s a great report for making sure you’ve categorized everything correctly and that you’re not missing any potential tax deductions.

Payments Collected
Now that you’ve looked at your expenses, you can focus next on money that’s flowing into your business—your income.  The Payments Collected report  gives you a breakdown of all the payments you’ve received, when they occurred, which client they came from and the method of payment.

In your FreshBooks account, go to the Reports tab, select Accounting Reports from the left-hand side, and click on Payments Collected. This will pull up a report of all the payments you’ve brought in.  Adjust the settings at the top so the report matches the date range you need, then hit the Update button.

You can use the Payments Collected report to dig into your billing income for the year and make sure all the information is correct.  Do your dates match up to bank statements, and have you recorded all of your payments?

A Few More Usual Suspects
There are a few other reports worth looking at in relation to filing your tax return. The Tax Summary report is good for looking at sales tax you’ve collected over the course of the year, and both the Tasks Invoiced and Item Sales reports are handy if you want a breakdown of how much you’ve earned for items as opposed to services.

Sharing with Your Accountant
If you’re using an accountant to help file your taxes, you can give them read-only access to your reports and journal entries by adding them as your FreshBooks Accountant.  They’ll be able to import all your transactions into the accounting system they already use, and can work with your data without having to manually enter it.

No matter where you start, the key is just to start early. Pop on a tax time playlist from the Learnatorium, get familiar with your FreshBooks reports and use the momentum to power through tax season like it’s nobody’s business.


about the author

FreshBooks is the #1 accounting software in the cloud designed to make billing painless for small businesses and their teams. Today, over 10 million small businesses use FreshBooks to effortlessly send professional looking invoices, organize expenses and track their billable time.