Get the Most from Your Small Business Credit Card – Charge Your Expenses

If you want to boost the success of your business, and make it easier to track your business-related spending, a credit card can be a great tool.

Credit cards offer rewards programs, can ease your cash flow, and can help you track expenses for tax purposes.  As long as you are smart about your business credit card use, the right small business credit card can be a great help.

Establish Business Credit

One of the fastest ways for your business to establish its own credit is with the help of a credit card.  Your business credit card records the good behaviors of your business.  When you pay on time and in full, you build a history for your business.  Later, this good credit history can make it a little easier to get approved for a business loan if you need the capital to expand your venture.

When you use a personal credit card for expenses you aren’t helping your company’s credit history.

Earn Rewards

Even business credit cards come with rewards programs.

You can use your business credit card to earn free travel, as well as other free items or cash back.  For example, if you fly often then an airline miles card for your business can help you rake in the miles which can translate to free flights.  Think about that for a second.  Your business expenses can earn you free flights.  That’s awesome, no?

Some business credit cards are part of networks that can offer you discounts on items you purchase from partners.  Between rewards and discounts, it’s possible for you to make the most of your operating capital as you try to start or grow your business.

And it doesn’t have to be your particular card either.  Many reward programs allow you to give cards to employees.  When your employee spends you earn the rewards.

Ease Your Cash Flow

small business credit card in wallet

A small business credit card in your wallet makes tracking your business expenses easier.

Credit cards can help you ease your business cash flow.  You can use your business credit card to pay for equipment and make other business purchases, and that can free up other money for payroll.  If you are waiting on a payment from a customer or client, your credit card can help you get through the difficulty until you are paid.

Your credit card also makes paying for items easier.  Relying on business checks is cumbersome (doesn’t that checkbook tend to be huge?!?).  Sure you could use a debit card but you never know when you might need that cash too.  Once it’s spent it’s gone.  A credit card helps ease that.  And purchasing online becomes easier, and sometimes safer, when you have a credit card to use for payment.

Don’t abuse your credit card limit though.  Make sure you use your card wisely when it’s needed.

With the right usage, a business credit card is perfect for managing cash flow.

Track Your Business Spending

If you want to document your business spending, a small business credit card makes it easier.  Keep all of your spending information in one place.  You can use your statements as documentation to back up tax deductions, as well as to help you create a budget for the coming months.

Most cards will give you a summary of all card spending at the end of the year.  These might even break out your spending into different categories so you can see where exactly your company money is going.  And many have online tools to help you budget and track your expenses.

Most cards also play nice with accounting software like Quickbooks that allow you to download your credit card transactions into the accounting program.  This makes is easier to record expenses into your accounting software.  I find recurring expenses are especially easy in Quickbooks.

American Express released ReceiptMatch(SM) which allows you to upload scans of your receipts.  Amex will then match your receipt to the charge on your statement for you.  Your employees can use this feature as well is they have an employee card.  This is just one example of the many ways your business credit card can help you track your expenses.

As long as you are careful to use your business credit card only for business expenses, it can be a helpful tool as you attempt to keep track of where your money goes for your business.

Keep Your Business Purchases Separate from Personal

Make the Most of Your Business Credit Card

In order to make the most of your business credit card, you need to have a plan.

Try to make as many purchases as possible with your card, so that you can earn maximum rewards points/miles/cash back.  Also, when possible, pay off your balance each month.  Carrying a balance can offset the value of your rewards.  Besides, you don’t want to rack up so much debt that your business is in jeopardy.  Spend according to your budget, and stick with your plan, even as you incorporate credit cards into your efforts.

The Final Word On Using a Business Credit Card to Track Expenses

I love having a business credit card.  When I make a business expense it goes on the card.  This way I have an easy record of the expense for tax purposes and for my accounting software (Quickbooks).  I gotta admit there’s also a nice little ego thrill in seeing my company name on the card.

After a little time, your business credit card will become an essential tool for helping you grow your business.  And, as long as you are savvy and responsible, your business credit card can be just what you need.

Do you have a business credit card?  How have you gotten the most from it?



Published or updated August 11, 2013.

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