Owning your own business, especially in the early days, requires you to be a highly competent multitasker – playing the various and varied roles of manager, marketer, planner, financier, director, administrator and many more! With such a hefty task ahead, it is no wonder that so many new businesses fail. However, help is out there and perhaps none more useful than your accountant. So, avoid the common business pitfalls by heeding the experience and advice your accountant will be more than happy to provide, including helping you to embrace cloud accountancy so you can work whenever and however is best for you.
1. Make sure you have enough money
Most businesses will not make money when they first launch and a large proportion will not make significant money for years. Many small business owners will sacrifice a wage and empty their pockets and bank accounts to make the business work, but actually paying yourself a modest salary is important for your wellbeing and ultimately the long-term success of the business. Your accountant can help you stay on top of your bookkeeping and finances, including ensuring cash flow and savings are accurately weighted. By using simple software, your accountant can even collaborate with projections and planning online through ‘the cloud’ to fit around your timetable.
2. Don’t miss that all important tax filing date
No business wants to miss a deadline for a filing and have to pay out extra money in fees and penalties. Whether a start-up or a small business, you have certain tax and administrative obligations to meet throughout the year. It’s hard enough keeping on top of the day to day running of your business, let alone trying to keep on top of dates and deadlines for this year and the next. But don’t fear, your accountant is on hand to both flag and help you prepare for key dates in the financial calendar, as well as keep your tax returns bill to a minimum and advise on the best tax planning solutions. They can also help you strike a balance between company taxation and personal taxation. The days of rushing to the post box with a large print out are over – online filing can save you time and stress.
3. Accelerate the growth potential of the business by having your books in order
Keeping track of financial data is no mean feat. It requires a lot of time and even more inclination. Moreover, taking this data and using it to not only sustain but grow the business is vital. Don’t be afraid to let an accountant in and see your finances. Accountants do this day in and day out so it is advisable to lean on them for help and guidance. The easiest way to do this is via online accountancy software. Your accountant will have access rights and can ensure that your balance sheets, profit and loss statements, ledgers and bank statements are all in perfect order.
4. Be aware of legislative changes and ready for legal obligations
Your accountant can help and support you with any legislative changes that will impact your business. One such example is Automatic Enrolment, a pension law that means business owners now have a legal obligation and responsibility to help employees save for retirement. As well as making you aware of such legislative changes, your accountant can help you create an action plan – everything from finding your automatic enrolment staging date to forecasting your costs and all the advice in between. So look to your accountant to put in place a robust set of policies, procedures and contracts to make sure that you are prepared for all eventualities. The right software can simplify things for you as legislative requirements are built in and kept up to date – especially with online software that is usually maintained and updated with a continuous cycle, meaning you will always be paying the right tax and national insurance for example.
5. Have real-time insight into your finances
Worryingly, many small businesses go about their day-to-day operations without any real insight or understanding into their business’ financial condition. Some business owners believe that ‘checking in’ on their bank balance is enough. However, sporadically monitoring your bank balance doesn’t give an all-round view into financial reporting or identify important business trends. It is this type of information that enables a business to make informed decisions, whether it is hiring a new employee or spending more budget next month on marketing, ultimately the bank balance doesn’t accurately reflect the financial sate of the business. Your accountant can help you identify simple and easy-to-use cloud computing software that will enable you to keep a much better handle on your finances. Moreover, this type of software can provide your accountant with easy access to your financial data on a regular basis, enabling their advice to play an even bigger role in your decision making.
So, take some of the strain off starting or running your own business, don’t worry about trying to be everything to everyone to make it a success. Instead, look to your accountant and compliment that invaluable advice and support with easy to use accountancy software, and feel some of that weight lifted off your shoulders.
Nick Longden is vice president of the accountants division at Sage UKI.
Further reading on accountancy
