Self-employed professionals: 10 common accounting and financial management mistakes

1. Mixing personal and business finances

This is mistake number one for beginner self-employed professionals. Using your personal account for business transactions creates total confusion: impossible to track real profitability, difficulties justifying deductible expenses, major complications during a tax audit.

The consequences are concrete: you no longer know how much you're really earning, you lose legitimate tax deductions, and you risk reassessments.

The solution is simple: open a business bank account from the start of your activity. Use an invoicing tool to trace all your transactions. This clear separation also facilitates your accounting and tax returns.

Need help getting started? Consult our guide on essential administrative steps.

2. Forgetting to register for VAT (or registering too late)

In Switzerland, VAT registration becomes mandatory from CHF 100,000 in annual turnover. The common mistake: waiting to exceed this threshold without anticipating, which creates a retroactive problem.

The consequences are heavy: fines, VAT due retroactively without having invoiced it to your clients, complex administrative catch-up. You'll have to pay out of your own pocket the VAT you didn't collect.

Practical solution: anticipate from CHF 80,000 in turnover, check your turnover regularly. Also know that voluntary registration is possible below the threshold if it benefits you.

To choose the right declaration method, read our article on VAT declaration methods.

3. Invoicing late (or not invoicing at all)

The later you invoice, the later you get paid. It's mathematical. Yet many self-employed professionals accumulate uninvoiced services and find themselves in cash flow difficulties three months later.

The classic psychological mistake: the fear of "bothering" the client. Result: thousands of francs uninvoiced lying dormant whilst you stress about paying your charges.

The golden rule: invoice immediately after the service. With a tool like BePaid, creating a compliant invoice takes two minutes. Automate the process so you don't have to think about it anymore.

Discover other common invoicing mistakes to avoid absolutely.

4. Neglecting payment tracking and reminders

Issuing the invoice and passively waiting for the client to pay: here's a costly mistake. Unpaid invoices accumulate, your cash flow deteriorates, and you lose control.

Real statistic: reminders significantly increase the recovery rate. A simple polite reminder at 30 days is often enough to trigger payment. Without a reminder, some invoices are simply forgotten.

Effective solution: set up an automatic reminder system (1st reminder at 30 days, 2nd at 45 days, 3rd at 60 days). BePaid manages these reminders automatically, you no longer have to think about it.

Active payment tracking is essential to avoid liquidity problems.

5. Not provisioning for social security contributions and taxes

The classic shock for self-employed professionals at year-end: having to pay AVS, taxes and VAT all at once. The mistake: considering all the money received as available to live on or invest.

Practical rule: set aside approximately 25-30% of your turnover for charges. Count approximately 10% for AVS, 10-15% for taxes, plus VAT if you're liable.

Concrete solution: open a savings account dedicated to charges. Automatically transfer a percentage of each payment received. This money isn't yours, it already belongs to the State and social insurance.

This simple discipline will save you from nasty surprises and cash flow difficulties at year-end.

6. Losing or poorly archiving your supporting documents

In Switzerland, the legal obligation to retain accounting documents is 10 years. Yet many self-employed professionals have invoices scattered everywhere: paper, emails, downloads, photos on the phone.

The consequences during a tax audit are direct: impossibility of justifying your deductions, tax reassessment, fines. You lose money because you can't find your supporting documents.

Practical solution: systematically digitise all your documents. Use a simple filing system by year and category. Regularly export your invoices from your invoicing tool.

A good tool like BePaid automatically keeps all your issued invoices and allows you to export them at any time.

7. Underestimating or miscalculating your prices

The classic beginner's mistake: calculating only your working time without including social security contributions, holidays, illness, administrative time, equipment, professional tools.

Consequence: you're working at a loss without realising it. You're busy all week but earning less than minimum wage.

Realistic calculation method: (desired salary + charges + overheads) divided by the number of actual billable hours. Count approximately 1200-1400 hours per year, not 2000. The rest goes on administration, prospecting, training.

Solution: review your rates annually. Don't be afraid to increase your prices. Your clients prefer a profitable and sustainable service provider to a self-employed professional who disappears after six months.

8. Ignoring VAT payment deadlines

If you're liable for VAT, you must declare quarterly or half-yearly. The common mistake: forgetting deadlines, declaring late, discovering fines.

The consequences: default interest of 4% per annum, administrative fines. Additional trap with the agreed services method: you must pay VAT to the State even if your client hasn't paid you yet.

Practical solution: note all VAT deadlines in your diary with reminders. If your cash flow is tight, consider the effective services method which allows you to declare VAT only on payments received.

Understand the differences between methods in our article on VAT declaration.

9. Not budgeting for professional tools and services

The beginner's mistake: wanting to do everything for free or with makeshift solutions. Result: you waste time with unsuitable tools, risk non-compliance, and stress unnecessarily.

The reality: certain investments are profitable. A good invoicing tool, professional liability insurance, an occasional accountant for validation: these expenses save you time and avoid costly mistakes.

False economy: spending three hours cobbling together an Excel invoice instead of paying CHF 20/month for a compliant tool that does the job in two minutes.

Solution: budget CHF 200-500/month for your essential tools. Compare the cost versus the time saved and peace of mind. BePaid at CHF 20/month is a minimal investment for compliant management.

10. Waiting until year-end to take stock

Managing day-to-day without an overview: that's how you discover profitability problems six months too late. Nasty tax surprises arrive at year-end when it's too late to act.

The mistake: never taking the time to analyse your figures, discovering in December that you've been working at a loss all year.

Simple solution: do a 30-minute monthly review. Check your turnover, your expenses, your unpaid invoices, your provisions for charges. Use the exports and dashboards from your invoicing tool.

Recommendation: consult a fiduciary at least once a year for validation. Discover when delegating your accounting becomes relevant.

How to avoid these mistakes: the right reflexes to adopt

These accounting mistakes are normal at the start. The important thing is to correct them quickly. Here's an actionable checklist to get off on the right foot:

• Separate your personal and business accounts from the start

• Choose a compliant invoicing tool (Swiss QR-invoices)

• Invoice immediately after each service

• Automate your payment reminders

• Provision 25-30% of your turnover for charges

• Keep a simple monthly track of your finances

• Systematically archive all your supporting documents

• Get occasional support from a professional

With these simple reflexes and the right tools, you'll avoid the management traps that cost self-employed professionals dearly. Administrative rigour isn't sexy, but it guarantees your sustainability.

Accounting and financial mistakes can cost a self-employed professional dearly: payment delays, tax penalties, cash flow problems or unnecessary stress. The good news? Most of these traps are avoidable with good habits and the right tools.

Separate your finances, invoice quickly, track your payments, provision your charges and archive your documents. These simple reflexes will save you time and money. If certain aspects remain complex, delegating to a fiduciary can be a relevant option.

For invoicing and payment tracking, BePaid supports you daily: create compliant QR-invoices in a few clicks, automate your reminders and keep an eye on your cash flow. Try BePaid for free and focus on what really matters: developing your business.