Hiring the right accountant is one of the biggest decisions you can make for your small business. A good accountant can save you time while a bad one can cost you money. To help your business grow, consider some of the following pointers on why you should choose an experienced CCA for your small business.
A chartered accountant can provide you with advice on writing a business plan
When writing a business plan, it is best to involve an accountant as they will add financial reports and projections to the plan using accounting software. This will make your business plan professional and realistic. If you hire a chartered accountant from an early stage in your business, you will get the benefit of their financial advice and knowledge right from the start.
Minimise your tax bill
Most small business owners aren't fully aware of their tax obligations, hence the reason they turn to an accountant. Linghams Chartered Accountants will assess your business in detail to see whether you're abiding by all the tax rules and making full use of your tax allowances. This professional will complete your annual accounts in a formal format including your profits, outgoing costs, and the amounts owed. If you're a sole trader, your taxable income is calculated from 6th April to 5th April the following year. This means that your accounts must be completed before 31st January in order to be included in your self-assessment tax return. The Inland Revenue imposes fines on late tax returns so it is important that you use an accountant for this task.
An accountant will produce financial statements to your lenders
Most small businesses need to borrow money from lenders to grow and expand. At some point, your business will need extra funding for new equipment, expansion, or buying additional offices. Before applying for a loan, make sure you ask a chartered accountant to prepare your financial statements so that your chances of approval are increased.
An accountant will register you for VAT
If your yearly profits exceed £80,000, you will need to register for VAT. An experienced accountant can deal with this task on your behalf so you have less paperwork to worry about.
As a limited company owner, your employees' income tax and national insurance need to be calculated and deducted from their gross wages before being paid over to HMRC. PAYE is a monthly payment that is deducted from your staff so there is no cost to your business. However, most small businesses leave this task in the hands of an accountant as PAYE can be mind boggling to many business owners. All you need to do is hand over your staff's P45 to the accountant and he/she will enter the details into the software. Once they work out the necessary deductions, your employees will be supplied with payslips.
An accountant will help you manage change
Whether you want to hire more staff, introduce a new business partner, or become a limited company, a chartered accountant can help you. This professional has a vast knowledge in many topics aside from bookkeeping and can offer you a wealth of guidance and support whenever your business circumstances change.
To conclude, every small business owner has to abide by law and fulfil their tax duties. This is why employing a chartered and certified accountant is essential to oversee all your financial matters and avoid penalties or fines. When you have a professional accountant take care of all your business affairs, you will be able to carry on doing your work with peace of mind.