Smart business owners know that an accountant and a good accounting system are essential in business management. But some small business owners try to do all management functions on their own, in order to save money.
So, when should a business owner hire an accountant? An accountant can be of assistance at every stage of business growth. An accountant can help create the business plan and form the company. He or she can provide assistance in applying for loans, preparing for government audits and generally streamlining the financial aspects of a business.
When do you need an accountant?
Here are some signs indicating you need an accountant to help you manage your business.
- Initially, you need an accountant as soon as you decide to have your own business. You need help in deciding whether to register as a ‘self-employed sole trader’ or a ‘limited company’ with HMRC as there are many advantages and drawbacks to each type.
- You need an accountant when your bookkeeping is in disarray and it’s getting harder to keep track of your expenses and revenue.
- When it’s tax time, you have to ensure that you claim the right exemptions and benefits as you prepare your tax return. The process of filing a tax return is not only long; it is also an arduous process. Do you know how to complete the self-assessment tax returns if you’re a sole trader? Computing income tax payments after deducting your personal allowance and making National Insurance contributions can be confusing as well.
- If your business is growing and expanding, your business expenses will also increase. An accountant can help you save and keep separate books for personal expenses and business expenses, which by the way, are tax deductible.
- If HMRC conducts an audit of your business, you will definitely need an accountant. The presence of a trained professional alone is enough to calm your nerves because being audited is surely nerve-wracking. An accountant knows financial and business terminology and can clarify things for you. The accountant will be able to advise you on what to do and what to prepare in case of an audit.
- An accountant will be able to help you prepare the required documents when you seek additional financing or investment. He or she will be able to go over all your financial documents and help prepare a financing proposal for submission to the bank or an investor.
Find the right accountant for your business. Check out accountants Central London offers. Once you’ve found the right one, you’ll be glad that you can delegate the financial affairs of your company to a professional. When you do so, you will have the time you need to handle the other aspects of your business growth.