21 Jan Here’s what every entrepreneur planning a startup should know…
Small and micro businesses are integral to the UK’s economy. In 2018, there were 5.4mn UK micro businesses, which was a total of 96% of all UK business organisations. A micro business employs between zero and nine workers. Though that might not sound like a lot, it can be tough owning and operating your own business. Around 50% of startups cease to trade within their first year alone, and many of these business failures are as a result of poor financial planning.
What you need to know before launching any startup
If you intend to launch yourself as an entrepreneur and start a new business venture, here are some of the important considerations to keep in mind:
– It’s all very well to focus your energies on building your business and ensuring it stays operational; however, don’t ever forget that bookkeeping and finance are central to day-to-day business operations. It’s likely you will be running the finance side yourself at the outset, so it’s vital you understand the accounts thoroughly and practise sound financial management skills. You will need to maintain comprehensive accounting records and may wish to consider an appropriate software package for this task.
– If you don’t want to learn basic financial management skills you could consider putting professional support in place to ensure suppliers, employees, customers and government bodies are not impacted over the weeks and months ahead. This could be critical for success if you have payroll obligations or plan to register your startup for VAT. The requirements of the government’s Making Tax Digital initiative will kick in on 1 April 2019, which will mean you could be required to make digital VAT returns.
– Financial guidance, VAT advice and payroll support from a professional accountant can help ensure any entrepreneur stays on top of their game, irrespective of the economic trading climate. Many entrepreneurs have an idea that accountancy services are an unnecessary cost; however, opting for the expertise of a professional can not only save your business money but also help source essential funding and grants when needed such as R&D tax credits.
A professional business accountant could help
Even before you launch your new business, the support of an accountant can be really advantageous. An accountant can offer the professional insight and knowledge needed to guide your startup planning and ensure the financial health of the organisation from the outset. Your accountant can also provide the specialist advice needed on statutory payment requirements, such as essential workplace pensions, different VAT schemes, and income tax and National Insurances bands for employees and contract staff.
Accountants aren’t just useful for helping you keep track of your everyday bookkeeping; they also have their finger on the pulse, so you can expect to be advised of important legislative changes that could impact your business. What’s more, your accountant can help you increase the potential of your business to maximise growth by analysing your cash-flow analysis and creating forecasts which could help you secure much-needed funding down the line.
SQK Accountancy specialise in the cloud services that can help any startup achieve a successful launch. We’re proud of our solid professional reputation and affordability and can help any budding entrepreneur achieve their objectives. Get in touch for more details.