The Top 10 Expense Categories Every Small Business Should Track

If your expenses are all over the place, it’s hard to know what you’re actually spending, or what’s deductible. The fix isn’t “more categories.” It’s the right categories, tracked consistently. When categories are clean, your reports become useful, your CPA gets what they need, and you can make confident decisions. You’re not alone; most owners start with messy categories because nobody showed them a simple system.
 

Quick Answer

• The core categories most small businesses need

• How to keep categories simple

• What to review monthly

• When category cleanup needs a pro
   

The Real Problem

Most category chaos comes from:

• Overthinking it

• Inconsistent labeling

• Personal expenses mixed in

• Not reviewing monthly
   

Why It Matters

• Missed deductions and messy tax prep

• Bad decision-making (“Why is my profit low?”)

• Harder budgeting and pricing
   

Simple Framework
 

Simple Categories → Consistent Use → Monthly Review
 

Top 10 Categories (common, broad)

1. Advertising & Marketing

2. Software & Subscriptions

3. Office Supplies

4. Professional Services (legal, accounting)

5. Contract Labor (contractors/1099)

6. Meals (business-related)

7. Travel

8. Insurance

9. Repairs & Maintenance (business-related)

10. Bank & Processing Fees
     

*Your exact setup depends on your business, but these are the backbone.
 

DIY Action Plan

Today: Choose your “top 10–15” list and stick to it.
This week: Recode last month’s uncategorized.
Monthly: Review your P&L for weird spikes.
 

Common Mistakes

• Using too many categories

• Putting everything in “Misc”

• Mislabeling contractors as supplies

• Ignoring processing fees
   

Tools + Templates

• Category cheat sheet

• “Where does this go?” decision guide
   

When to Get Help

• Categories are inconsistent across months

• “Uncategorized” is huge

• You’re unsure what’s deductible

• You’re preparing for taxes or a loan
   

Working With Us

• We clean categories monthly so your reports make sense.
   

If your categories feel inconsistent (or “uncategorized” keeps growing), we can simplify your setup so your reports finally make sense. If you’d like clean, accurate numbers you can trust, we can help. Book a quick call, and we’ll tell you whether you need a cleanup, monthly bookkeeping, or just a simple system.



 

FAQ

How many categories should I have? Usually 10–25, depending on complexity.
Do I need separate categories for every vendor? No.
 

Summary

• Simple beats complicated

• Consistency makes reports powerful

• Review monthly to keep it clean