But you can’t do any of these things, because you keep all of your business records in a messy desk drawer, and you’ve lost the receipts for all of them. It might be time to invest in a receipt scanner app.
Here we’ll go over everything you need to know about receipt digitization apps: why you should incorporate them into your business, how they work, and which one is the best fit for your business.
What are receipt management apps?
Receipt scanning apps photograph and create digital versions of your receipts, which you can easily retrieve from a digital filing system.
Most of them work roughly the same way. You download them onto your phone, use them to take pictures of your receipts, and then the app’s OCR (Optical Character Recognition) technology digitizes all of the text and numbers on those receipts and stores digital versions of them in a filing system.
These “smart receipts” are harder to lose and easier to retrieve, because you can quickly search for them with keywords and filters.
Why should I download one?
Digitizing your receipts removes a lot of the hassle involved in your recordkeeping operation. Regularly scanning and storing your receipts means that:
- When tax time comes, you won’t spend hours sorting through a pile of crumpled receipts wondering whether that $13 parking charge was for a client meeting or a date.
- You won’t miss any valuable tax write-offs.
- You’ll know exactly where your money is going every month—so you can cut spending where it’s getting out of hand.
Due to the Period of Limitations, the IRS also technically requires you to hold on to receipts for significant expenses (i.e. larger than $75) for at least three years.
Digitizing your records is also a great way to avoid accidentally tossing them in a move or an overzealous fit of spring cleaning. Plus, let’s not forget that paper records can fade, and are susceptible to damage. Telling the IRS that “the dog ate my tax records” simply won’t fly.
What are the best receipt-scanning apps?
Lots of accounting and expense tracking apps offer digital scanning capabilities, but here we’ll focus on the most popular solutions: QuickBooks, Expensify, Bench, Receipt Bank, and business record scanners.
QuickBooks: For the accounting-savvy business
QuickBooks offers a receipt-scanning function that plugs into the rest of the app’s powerful suite of accounting tools, allowing you to scan receipts, create expense reports, do your bookkeeping and create financial reports and statements all in one dashboard.
QuickBooks has more features than any other expense trackers in this list, and also requires the most knowledge, time, and effort to operate. If you’re unfamiliar with accounting, you might find QuickBooks frustrating.
But if you’re a QuickBooks pro, have a dedicated admin employee who’s willing to learn, and already use QuickBooks for your accounting, it’s definitely a worthy option.
Platforms: Android, iOS, web browser
Price: Starts at $12/month
Expensify: For the business traveller
If you work remotely or regularly have meetings in different parts of the world, you know post-trip expense tracking is a nightmare. Using Expensify means you can stop stuffing receipts into your luggage while you’re on the go. Snap pictures of your paper receipts with your mobile device, submit and be done with them.
Expensify also automatically imports receipts from ridesharing services like Uber and Airbnb, and also has a function for managing mileage tracking. Use the company credit card a lot? Expensify will import those expenses automatically from your card so you don’t have to go through your statements at the end of each trip. If you’re looking for an app for tracking employee travel expenses, it’s hard to beat Expensify.
Platforms: Android, iOS (iPhone), web browser
Price: Starts at $4.99/month
Receipt Bank: if you’ve got lots of receipts
Receipt Bank lets you digitize and store your receipts in pretty much any way imaginable. You can do it using a mobile app, via web browser, via email, or automatically by hooking your credit card up to the app. It also automatically imports receipts from PayPal and Dropbox, and lets you take photos of multiple receipts at a time.
Receipt Bank also integrates with most popular accounting software, including Xero, QuickBooks, FreshBooks and Sage One.
The only downside to Receipt Bank is that it won’t let you manually input receipt information, which can be a hassle if you don’t have the receipt in front of you.
But if you’re looking for an app that can ingest a lot of receipts quickly, in every way imaginable, Receipt Bank is the app for you.
Platforms: Android, iOS (iPhone)
The Kodak Alaris: for the high-volume scanner
If you’ve got a large or quickly-growing business with a lot of paperwork to deal with, you might consider investing in a dedicated business document scanner, like the Kodak Alaris.
These machines can process large numbers of documents at once. And they do more than just receipts: they can scan and digitize invoices, letters, legal documents, and anything else you might want to store away for later. The Alaris in particular can also take care of the filing process for you, saving you hours of work.
Price: Starts at $403.49 USD
Bench: For hands-off expense tracking and bookkeeping
Is money management and accounting for your small business not really your thing? Bench can take it off your hands entirely.
Categorizing your receipts can be a pain, but when you work with Bench, we manage that for you. You can use us alongside of your preferred receipt storage app, and we’ll take care of your business bookkeeping by importing, reviewing, and categorizing all of your expenses every month.
We’ll help you track your expenses and send you financial reports monthly so you can understand your finances better than ever. Then at tax time, we work with your accountant to deliver all the financial info they need to file your taxes.
If you’re looking for a hands-off expense tracking solution, it’s hard to beat Bench.
Platforms: web browser
Price: Varies by your business needs. See our pricing page for more details.
If you don’t process a particularly high volume of receipts, you might be able to get away with one of these low-tech, near-free solutions:
Excel or Google Drive
Spreadsheets are the tried and true method of tracking your expenses (for free)—provided you don’t mind a bit of data entry work. Just find a good bookkeeping Excel template and make sure to update it at least once a week.
The great thing about Excel is, once you’ve entered all your transactions, you can generate reports and start getting insights about what those numbers mean. For example, if you use the Bench Income Statement template, your transactions will turn into a handy income statement sheet, showing your profit and loss over a certain period.
In addition to letting you save receipt photos and voice memos, Evernote’s “receipts” extension lets you create budgets, save detailed expense reports, and gives you all kinds of powerful categorization and filtering tools that make retrieving old receipts easy. If you’re already an Evernote user, you’ll definitely want to check out receipts.
The camera on your smartphone
The IRS accepts digital copies of documents as long as they’re identical to the original copies. (This means you must be able to produce a printed, legible copy of the document for them upon request.)
If you’re not worried about organization and simply refuse to download a dedicated receipt tracking app, you might be able to get away with simply taking a photo of your receipt and storing it on your phone.
It’s not a pretty solution, and you’ll have a tough time retrieving old receipts without the powerful OCR functionality that some of the apps above use, but it’s better than having no backup at all.