New Year - back again so soon?

New Year - back again so soon?

So, that’s another New Year over with. Or is it? If you run your own business, whatever the size, you’ll be well aware that the financial year is not over yet - but the end is getting close. For the self-employed and small-business owners, Moira Stewart’s assertion that “tax doesn’t have to be taxing” is all well and good - but many of us know that tax can be very taxing indeed.

For those who have recently taken the self-employment plunge and are approaching their very first financial New Year, it’s important to follow the lead of shops at Christmas: start early - very, very early. Don’t underestimate the time that getting those accounts and tax records up to date and correctly filed can take. Here are the key points that will get your accounts right and in on time.

Accurate records

Record keeping is vital. Recent reports have illustrated just how frustrating - and potentially lethal - poor record keeping can be. Without accurate records and paperwork to back them up, many small firms have been hit with crippling fines after investigations by HM Revenue & Customs (HMRC). While business leaders and business support organisations argue that this is seriously damaging a vital sector that should be receiving support,not punishment, the simple fact is that good record keeping can help avoid sleepless nights.

Professional Advice

Whatever the size of your business, accounts are a crucial part of your record keeping.The very smallest operations may be able to manage with a simple Excel-based system. This is OK while things are small, and may also suit those who run a small business part-time. Taking some advice from an accountant or business adviser is always a sensible step whether you’re thinking of starting up or have recently established. The larger and more complex your business grows, the more important it becomes to take professional advice.

Accounting software packages

Accounting software can be indispensable for any business - products on the market now are impressive. Online and desktop software products allow you to keep control of your accounts, create reports and produce professional invoices. All these functions and others, such as VAT calculation and payroll, make accounting simple and straightforward.

The smallest business may not currently feel that the need for accounting software is a priority, not least because of the cost. However, apart from the obvious benefit of making the whole accounting process straightforward on a daily, weekly and year-end basis, accounting software requires less effort than a home-made Excel version. And there can be a significant cost saving achieved by presenting your accountant with a set of accounts in a format that is easy for them to understand and access.

Software choices

The choice between desktop or online accounting software is partly a personal one. Specific issues relating to online products include data protection. Before picking a package check what legislation that applies to you – the Information Commissioner’s Office (ICO) can help - and ensure that the supplier’s product conforms.

The big advantage to online software is that you can update records from wherever you are working without the need to pop back to the office before going home or taking work home. With most packages there will be options for multiple users and you can also arrange access for your accountant. This can save time and effort for you both, save money and make the process much smoother.

Making the best use of accounting software available and professional advice may mean you even find yourself agreeing with Moira Stewart.

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