Is it time for you to get a headstart on your self-assessment accounts this year (for a change)?
One day, or day one?
Do you keep putting off your accounts each month because you think you will be able to catch up with it ‘later’? Or maybe you just bury your head in the sand hoping that your accountant will be able to sort it out for you at the end of the tax year?
The truth is, you need to take action now! If you aren’t continually on top of your numbers, how do you know if you are in the ‘black’ or the ‘red’? What happens if you have an unexpected large business expense?
Additionally, HMRC states you will have to follow the Making Tax Digital for Income Tax from 6th April 2024, so not long to go! Read more: https://www.gov.uk/government/publications/making-tax-digital/overview-of-making-tax-digital
Here are a few ideas to help you get a better hold on your accounts:
- Put a recurring weekly or monthly appointment in your diary with yourself and treat it as you would a dentist appointment – don’t cancel it, or you will feel the pain later! Getting into a healthy routine with your finances will make that year-end submission a total breeze.
- Invest in digital accounting software. At Atholl Accountancy, we love Xero. Features that we like are being able to reconcile and upload receipts from a mobile device. It also integrates with your business bank account so saves our clients so much time. If you’d like to hear more about Xero, just get in touch – we even offer Xero training to our clients!
- Did you know that there are huge benefits to working with your accountant on a monthly basis, and it might not be as expensive as you think it would be?
If you only use your accountant after the end of the year, it might feel like the only benefit you get from them is calculating your tax bill. In that situation, the value of their advice can be limited as the information they have is out of date, and the situation the business is in has changed.
A monthly accounts service usually means that your accountancy fees increase, but it should also create bigger savings in other areas of your business that more than offset that cost. Here are some of the benefits:
- Tax planning – by reviewing your finances monthly, we can help you plan for your tax bill and make the most of opportunities to minimise it - legally of course! That may be through things like the timing of buying new equipment for your business, by investing in pensions or planning the timing of your dividends.
- Better insight into what is happening in your business. Having timely information helps you make more proactive decisions – are your costs rising? What can you do to offset or minimise them? Is business growing continually? Do you need more staff to manage it? Are there inefficiencies in the business that are reducing your bottom line?
- Cashflow management – every business can benefit from cashflow planning, whether it is to stay in the black, or to ensure that cash reserves are being properly managed and working for the business. Often businesses with healthy bank balances don’t think they need to plan their cashflow, and there is a danger of complacency. Poor cashflow can cause even a highly profitable business to become insolvent, so it is always important to look at the longer-term view.
- Systems reviews and technology efficiencies – by making use of cloud software and apps, your accounting process can be painless. Your accountant can help you find the best fit for your business, maximising the benefit you get from your financial information, whilst reducing the time you need to spend to achieve it.
So, by making today your day one to make changes, you’re already one step closer to success.
