03 Mar 3 myths around small business accounting
Choosing to set up your own small business is a huge decision and one that will change your life.
Of course, if you get it right then this will be in a positive way. Many people running successful small businesses love the chance to be their own boss and do something they love for a career after all. To make it work though, there are some key areas to get on top of. Accounting is certainly one, as without your business accounts in order, you will struggle to survive and grow.
This is an area of business where there can be some common misconceptions to avoid. But what are some of the biggest accounting myths for smaller companies?
It’s not worth hiring an accountant
This can be something that many small business owners mistakenly believe – especially if they are sole traders or only employ a handful of staff. It is essential though to know that outsourcing your accounts still makes sense and is not only for medium or larger companies. Whatever size of company you are, you will have to keep an eye on your accounts and get any relevant returns back to HMRC on-time. It represents much better value to hire an accountant to do this, rather than having to take time out from core work to handle yourself.
SBA is all about tax returns
There is no doubt that completing any relevant tax returns on-time is paramount for any small business. But people can sometimes focus on this one area too much and forget about the rest of it. Looking after your company accounts is not just about tax! You should also be keeping a regular eye on cashflow, income, expenses and strategically planning for future growth. It is also worth planning to set up an emergency fund, should any external events impact your business (like COVID-19).
It is easy to handle your own accounts
While you could handle your own accounts, do not make the mistake of thinking it will be easy. The sheer work keeping up with changes to tax laws brings is almost a full-time job in itself! You then have to fully understand and interpret all the rules correctly, so you do make any costly mistakes. There is then the job of managing your accounts in an objective way to take on. Trying to do all this whilst running your own business is a tough ask. For this reason, many business owners choose to outsource it to a professional accountant.
Small business start-up support with SQK Accountancy
If you think that looking after your small business accounts is best left to the professionals, let us help. Based in Manchester, our team of fully qualified accountants are here to support you. Call on 0161706 0444 for more details.