20 Oct Why you need an accountant?
If you are starting a small business on a limited budget, you have probably spent some time trying to figure out where you can cut business costs and try to do more on your own.
If you have a lack of experience in managing business books and expect to learn as you go, you should think twice.
Managing your own accounting system incorrectly can hurt your business and not only now, but also in a long-term way. Hiring a good accountant can add real value to your business. Not only they will help you manage your accounts, they will also help you to make better business decisions, help your company grow, legally minimise your tax bill, and of course, save you lots of time on admin.
Realize if you really need an accountant won’t take long. Give yourself a minute break and think: how long it would take you to do prepare all your taxes without any minimum mistake?
Shall we say, roughly, 10 hours with your time worth £100 per hour?
That’s a cost of £1000 to do your taxes yourself. And there’s still the risk you have made errors. That won’t be unlikely, especially if you’re multi-tasking like most business owners.
Instead, if you get an accountant to take care of time-consuming tasks like taxes, it’s quite likely they will cost less per hour than you would pay yourself. You will not only have extra time to deal with your business, but you will also have peace of mind that an expert is taking care of the details.
There are several good reasons for hiring an accountant at different stages of your company’s growth. From a business plan, to company formation or loan application to government audit, an accountant can make life easier for you at each step.
Let’s have a look in details what an accountant can do for a small business owner:
Regular business operation
An accountant can help you:
• Ensure that your independent contractors are classified by the IRS
• Oversee company payroll and payment processes
• Provide advice on estimated tax payments you should make
• Close out your books and create financial reports at the end of the year
The Start-Up process
• Determining your business structure
• Assisting with the financial analysis in your business plan
• Providing advice on the type of accounting server you may need
• Giving instructions and assistance on opening a business bank account
Business growth stage
• Help you determine areas for growth by providing insight on cash flow patterns, inventory management, pricing and business financing
• Prepare you for and guide you through an audit, if necessary
• Create financial forecast so you can make better decisions in your business
• Provide advice and resources to assist you with the sale of your business
Maximize your tax bill
• Accountants will help you to minimise your tax bill by taking advantage of any legal benefits that are open to your business
• Accountants will go through your business in details and check to see that you’re making full use of any tax allowances and reliefs you can claim
Register you for VAT
• If your annual turnover is getting close to or is above £82,000, you’ll need to become VAT registered
• If you make all of your sales to VAT-registered businesses, you may benefit from being VAT registered even if you are under the threshold, as you can then reclaim VAT on any business expenses you incur
• An accountant can deal with VAT registration for you – leaving you with less admin to worry about
Be aware of legislative changes and ready for legal obligation
• Have a real-time insight into your finances
• Don’t miss Tax deadlines
4Fold is a team of chartered certified accountants and bookkeepers, South West London based, who offers affordable fixed fee accounting packages to meet the needs of any start-up or small to medium sized business.