Tax season isn’t the most exciting time of year for restaurant operators, but staying prepared doesn’t have to be painful. In fact, adding a few easy habits to the daily routine can make things a lot easier—and even uncover some ways to improve the bottom line.
By staying on top of a few simple tasks each day, restaurant leaders can avoid the stress that comes with last-minute scrambling, keep financial records in order, and help the accounting team stay on track. Here are five easy steps to make tax season just another part of the regular routine.
Keep accounting in the loop about new employees
With restaurant turnover rates consistently high, keeping track of new employees is more important than ever. Whether it’s a fresh face behind the bar, seasonal staff for the patio rush, or a new kitchen hire, every employee needs to be accounted for to ensure payroll taxes are accurate.
By making it a habit to notify accounting as soon as someone new is hired, managers can avoid payroll issues down the road. A missing name in the system can lead to reporting errors, miscalculated withholdings, or even penalties come tax time.
Since labor is one of the biggest expenses for restaurants, maintaining accurate records is also key to tracking costs. Staying on top of this information ensures W-2s, 1099s, and other tax forms are spot on when tax season arrives—no frantic backtracking required.
Keep an eye on automated accounts payable
Gone are the days of drowning in paper invoices and digging through filing cabinets to find old receipts. Automated AP tools simplify invoice management, allowing managers to upload invoices, match them with purchase orders, and schedule secure digital payments with ease.
But even with automation in place, managers should still review AP records regularly to keep things running smoothly. A quick daily check helps ensure invoices are accurate, payments are on track, and nothing slips through the cracks.
Catching errors early—like duplicate invoices or incorrect charges—prevents costly surprises when reconciling records at year’s end. Plus, staying on top of AP helps managers better understand cash flow and identify spending trends that may need attention.
Don’t skip the daily sales summary
The daily sales summary (DSS) might seem like just another report, but it’s one of the most valuable tools for keeping accurate financial records. This daily snapshot tracks sales, labor, tips, guest counts, and other key metrics—all essential for accurate tax reporting.
By reviewing and approving the DSS each day, managers ensure sales records are complete and accurate. This habit also makes it easier to spot unexpected trends—like an unexplained dip in sales or a sudden spike in labor costs—before they become bigger problems.
The DSS is also a helpful tool for managers looking to improve performance. Tracking sales patterns can reveal opportunities to adjust staffing, boost high-margin items, or tighten up costs—all while keeping financial data organized and tax-ready.
Log item transfers and waste right away
Inventory management is more than knowing what’s in the walk-in. It’s about tracking where everything goes. In multi-location restaurants, transferring items between locations is common, but forgetting to log those transfers can skew inventory data, making it difficult to get a clear picture of profitability and reconcile period end numbers.
Waste logs are just as important for accuracy. If waste isn’t recorded—whether from spoilage, over-portioning, or mistakes—it can throw off food cost calculations and cause problems when it’s time to prepare year-end statements for taxes.
By getting your team into the habit of logging transfers and waste each day, managers can keep records clean and find areas where costs can be reduced. Plus, tracking waste uncovers valuable insights, like which team members might need more training or which menu items are leading to unnecessary losses.
Monitor prime cost like a pro
If there’s one number that restaurant managers should know by heart, it’s prime cost—the combined total of food, beverage, and labor costs. Since prime cost makes up the bulk of a restaurant’s expenses, staying on top of it is crucial for maintaining profitability.
Monitoring prime cost daily helps managers spot issues before they snowball. Rising food prices, unexpected overtime, or sudden changes in sales patterns can all impact prime cost—and catching those shifts early allows managers to make quick adjustments.
Staying dialed into prime cost also helps managers fine-tune their operations. Tracking labor efficiency, reviewing vendor pricing, and promoting high-margin menu items are just a few strategies that keep prime cost in check and improve overall profitability.
Why daily habits matter
While tax season may only come once a year, staying organized throughout the year makes filing far less stressful. Building these simple steps into the daily routine not only keeps financial records accurate but also gives managers better insights into their restaurant’s performance.
Most importantly, these habits go beyond just tax prep. They empower managers to make smarter decisions, spot potential problems early, and drive profitability all year long. After all, when financial records are accurate and organized, there’s less time spent worrying about taxes—and more time spent focusing on guests, staff, and growth.
Chelsea Gunn is the General Manager of Product, Accounting, at Restaurant365.
