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If you are running your own business you might be wondering if it is really worth investing in the services of an accountant. To decide whether you should hire an accountant, you need to understand the ways in which an accountant can help your business.
What can an accountant do for my business?
An accountant can make two main contributions to your business. On one hand, they will help you comply with your statutory obligations, and complete important processes like tax returns correctly. On the other hand, an accountant will compile important financial data and provide strategic business advice to help with planning and decision-making. Accountants can also be a big help if you are setting up a business or, alternatively, when big changes happen within the structure of your organization.
Do you really need an accountant?
No matter the size of your business, hiring an accountant means that essential but time-consuming tasks like tax returns and VAT returns, are taken off your shoulders, providing you with more time to focus on your business. It will also provide you with peace of mind, as rules and obligations around these tasks can be complicated, and mistakes often result in penalties. Let’s have a closer look at what an accountant can do for you.
Sole traders
If you are a sole trader turning less than £85,000 per year, and are not VAT registered, your statutory obligations include: keeping accurate records of your sales and expenses, registering for and completing a Self-Assessment tax return each year, and paying income tax.
An accountant can help you navigate these responsibilities, ensuring that your records are accurate and that you are paying the right amount of tax. This will give you more time to focus on your core responsibilities.
When it comes to crunching numbers, an accountant can also help you automate your finances, helping you keep track of cash flows, invoices, and KPIs, and providing you with valuable data so you can make the right business decisions.
ARB Accountants offer a range of transparent, fixed-fee services tailored to freelancers and contractors. You can book a 60-minute free consultation today to enquire about our services.
Limited companies
Limited Companies have to comply with a bigger and more complex set of rules. As well as keeping accurate records and completing the necessary tax returns, as a limited company you have the duty to file an annual confirmation statement, making sure that the Companies House has the right information about your business. If you are turning over £85,000 per year in revenue, you are also legally required to register for VAT. Other responsibilities of limited companies include quarterly returns, payroll, and pension auto-enrolment.
These processes are often complex and time-consuming, and mistakes can lead to costly penalties. Most businesses will need the help of a professional to effectively perform these obligations. An accountant will ensure that the right forms are completed correctly and on tim
Additionally, your accountant can create financial reports, provide tax advice, and help you build a solid business strategy, to help you maximize your profits and make the right business decisions.
If you are registered for VAT you may be subjected to routine tax audits from HM Revenue & Customs (HMRC). Audits can be complex and often costly processes, and you should seek professional advice as soon as you are informed of an audit, to help you navigate through the process.
Personal
If you have more than one source of income, such as rented properties, an accountant can help you manage your income and ensure that you are tax-effective and compliant with the latest regulations.
5 Main Advantages of Working With an Accountant
1. Tax Services
An accountant will help you stay compliant with the latest HMRC tax regulations as well as ensuring that you are tax-effective and do not pay any more tax than what you are required to.
2. Bookkeeping and Financial Reporting
All businesses are required to file quarterly reports, but an accountant can help you create and manage data beyond your statutory obligations. They can set you up with the latest cloud accounting software so you can keep track of your spending and income.
3. Improving Cash Flow
Running a successful business does not only require making a profit, but having the right amounts of cash available at the right times. An accountant can help you manage your cash flow and come up with a spending plan and manage whatever situation your business comes across.
4. Valuable Business Advice
Experience accountants carry a wealth of knowledge and can offer valuable insight and advice as your business develops. They can use their understanding of data and financial projections to inform the direction of your business.
5. Freeing up your time
An accountant will not only provide an expert hand to deal with all the financial needs of your business but will also reduce the amount of time you spend on the administrative side of your business, allowing you more time to focus on your expertise.
Have a look at our Service page to learn about the kind of services that ARB Accountants can offer.
How to hire an accountant
Deciding on the right accountant or accountancy firm for you depends on the needs of your business. Some organizations, like insurance firms and registered charities, will need to work with specialised accountants. However, most small and medium-sized businesses require services that most accountants can deliver. If this is the case for your business, you’ll want to get in touch with potential accountants and choose someone with whom you can work well. You may also consult with other business owners, who can give you tried and tested recommendations.
At ARB Accountants, we offer tailored accounting services for freelancers, contractors, limited companies, landlords, and other small and medium businesses across London, Southend, and Essex. By working with ARB Accountants, you’ll always be only one phone call away from your accountant, who is dedicated to seeing your business grow.