When you start a business it’s common to do everything yourself to save money, after all you are trying to build up the business, not spend a fortune outsourcing tasks. However, there are certain points in the business when it makes sense to seek the advice of a professional accountant.
The financial records are one of the most important elements to get right in your business and can become overwhelming if you have no experience in this area. Accountants not only manage your business finances but they can also offer advice, help and support with business growth.
Here are some key times when it makes sense to hire an accountant for your business:
To create professional business projections
A professional accountant will use accounting software to keep track of all of your business income and outgoings so when it comes to creating business projections and business plans for the future it will be very easy for them to provide this for you.
When your accounts become complicated
If your business is initially small and has simple income and outgoings it can be okay to do it yourself, however, as you start to get more complex with more clients, more invoicing, different levels of expenses and possibly even staffing and premises costs to include, it can start to get far more complicated. This is when a professional accountant can really help you.
When choosing your company structure
When you start out you need to decide how to set up your business – it could be as a sole trader or as a limited company or something else. Accounting for limited companies has a different set up and different implications for tax and financial management compared to someone who is a sole trader. Making it advisable to seek advice from an accountant before going ahead.
When you need to free up your own time
There will come a time when doing everything in your business yourself is just no longer possible and you will need to delegate tasks out to professionals – it makes sense to get an accountant on board to take over the financial management if it’s starting to take you hours each day to sort out the books and receipts.
When you need to sort out your taxes
It might be that you only call in an accountant at the end of each tax year to help you to complete your tax return, and they can certainly help with that. But if you use them all year round they will have a better chance to offer advice on the types of tax deductions you might be missing out on otherwise.
When you need financial business advice
Having an accountant on hand not only helps with your physical accounts but they can offer help and support in a number of other ways, for example, they can complete legal paperwork for your company, and keep you updated on any changes to tax laws.
They can ensure your accounts meet all the legal company requirements and maintain records of your business creation. They can also handle payroll for employees and prepare your tax documents for you.
When you want to apply for a business loan
If your company gets to a level where you want to apply for a business loan, you will need an accountant to prepare all the paperwork to prove to the bank that your business is a viable investment and they will get their money back.
As your company starts to get bigger
Once your company starts to get bigger, for example, if you suddenly land a big client or find you can’t cope with all of the everyday work coming in and need to bring in outside help to take on the work.
At this stage your accountancy needs will become more complicated as well, perhaps with a need to start paying an employee and all of the implications which come along with that. An accountant can help support you through this growth period.
If you are considering buying a franchise or another business
If you are planning to buy into a second business or you are looking at taking on a franchise then you should talk to an accountant first to make sure it is a profitable and worthwhile endeavour. Taking on another business in this way can be great as they are already set up and established however you need to look at all of the cost implication as well.
Running a business is an exciting venture but there are distinct times when it makes commercial sense to take a step back from trying to manage all the finances yourself and seek help from a professional accountant. These are just a number of the situations in which employing an accountant will help to bolster your business but professional advice is beneficial at every stage. By Cheryl Davis
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