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You might assume that outlaying costs for professional support might be something you should consider once your business venture shows significant growth. It is now at the crucial point where you need to allocate a part of your budget to hire an accountant. However, the service of an accountant is something small businesses should consider at all stages of growth.
What is an Accountant?
Let us kick off with a few basics. An accountant is a trained and qualified professional who can prepare, check, and analyse financial affairs. Duties will usually include:
- Company formation.
- Preparing annual financial reports.
- Overseeing tax returns and aiding in future budgeting and financial planning.
Why should I hire an Accountant?
A good accountant will offer you a wide range of value-added services to assist you to stay on top of current tax requirements and compliance, saving money, reducing risk, managing growth, and planning.
As an entrepreneur all your critical business decisions will be based on your financial situation. Therefore, you will need an excellent accountant who can provide you with the necessary information and provide sound advice.
Choosing the right accountant should become your trusted colleague, who is always on hand to provide advice and guidance as your business venture grows.
In this guide, we help explain what accountants do and why you should hire one for your small business who will save you both time and money.
- Accountants deal with complex issues like VAT
- Accountants provide sound strategic advice
- Accountants will help with the financials
- Hiring professional payroll services
- Bookkeeping services
- Select the right accounting software
- Work with the latest technology
- Choose the right business structure
- Hire an Accountant when dealing with HMRC
- Accountants there for your business journey
Accountants deal with complex issues like VAT
VAT returnsare every business’s nightmare – not only is it the time when a large sum of money is payable. It is also when accounts records must be meticulously audited to collect accurate data on the exact monies coming in and going out. Get this wrong and you could be liable for a hefty fine or worse – aninvestigation from HMRC. An accountant can manage this accounting task and save you this hassle.
Accountants provide sound strategic advice
You will be best placed to understand what works and what does not in your business offering and your target customers. Still, accountants have a wealth of experience in making your business a success from a financial standpoint.
Accountants who work with different businesses across various industries should be able to give strategic advice on things like tax planning and business compliance, responding to ever-changing tax rules so that you can take your business to the next level.
Accountants will help with the financials
Business accounting extends way beyond keeping the books up to date. Having your financial statements in order for things like balance sheets, income statements and statements of cash flow are incredibly important. Not only do these documents give transparency over the company’s financial performance and business activities, but they are also used by creditors, investors, and market analysts to evaluate a company’s financialhealth and earnings potential.
Hiring professional payroll services
An experienced accountant who can provide comprehensive payroll services will organise all your payroll requirements. They can oversee the set-up and run your payroll for you, work to your agreed timelines, and provide email or physical payslips directly to your staff. They will also apply all necessary deductions (EG National Insurance, PAYE, Bonuses, Pensions etc.) and ensure all calculations are done accurately on time. They should also assist with registering a workplace pension scheme with The Pension Regulator.
Bookkeeping services
A good accountant will know how to get the most out of any bookkeeping software to streamline your processes, be more efficient, and provide insights to help inform business decisions adding real value, crucial advice, and recommendations for your business reporting.
Even if you have experience withbookkeeping, doing your books can be a real chore. It is time-consuming and tedious and a bit of a distraction when you should be focusing on other areas of the business, such as business development, marketing strategy and sales growth.
Choose the right business structure
An accountant will work with you to choose the right limited company structure which will be the most tax-efficient for your business. Assist in registering your business, file documents with Companies House and outline your legal obligations. Choosing the correct company set-up, company ownership and ensuring that the Articles of Association and Memorandum of Articles meet your business requirements is crucial at the set-up stage.
Select the right accounting software
With numerous cloud accounting software on the market designed for small to medium-sized businesses, work with an accountant to advise on the right accounting software that fits your business and its operations. For example, suppose your business makes several million pounds a year (XeroorQuickbooksmay be more suitable). In contrast, if you are a start-up, sole trader or small business with a turnover of around £60,000, you might want to look atFreeagentinstead.
The best online software will allow you to manage your tax returns. Still, suppose your business also needs to file year-end accounts,Corporation Taxreturns and Confirmation statements. An accountant will advise on the best software package, including good billing, invoicing software, and reporting tools. Then, you electronically file your records with Company House and your taxes with HMRC to pay the right amount of tax and avoid any penalties.
In addition, depending on the industry you work in (Beauty,Hospitality etc.), an accountant will help you consider software designed specifically to help your business.
Work with the latest OCR technology
A good accountant will always seek the latest tech trends to transform the data entry process and improve business efficiency. Optical Character Recognition (OCR) software will capture and analyse scanned invoices, receipts, bank, and card statements, automate data entry into Xero or QuickBooks accounting software and reduce time spent on data entry, increasing process efficiency.
Hire an Accountant when dealing with HMRC
An accountant will perform regular audits of all financial records and statements. They will examine accounting systems for flaws, create and maintain internal controls, highlight any fraud risk, interpret financial data for unusual trends, and follow up on potential fraud red flags.
Having a reliable accountant supporting your small business means having your financial records in order. They will have a clear picture of forecasts and trends and be able to provide accurate and timely payments to HMRC and deal with anytax investigationshould the tax authorities want to take a closer look at your numbers.
Accountants there for your business journey
As demonstrated above, having an accountant who is there by your side to support you during the ups and downs of your company’s development is worth their weight in gold!
They will make life much easier for you, overseeing your business finances, so you can focus on what you love doing best, running your enterprise in the most tax-efficient way. The added benefit is that your accountant should also be using cloud-based accounting software, which means you can collaborate on keeping track of your company’s financials.
Fusion Accountants are small business specialists and Accountants in London. Contact us now to see how we can help you.
