We all know start up businesses need to operate in a lean environment. Cashflow is often tight and there are months when there are more outgoings than incomings. As a result most business owners take on as many ‘roles’ as they can in the beginning, for two reasons. Firstly, they simply can’t afford to hire other people and secondly because when business is first starting it is often pretty simple so the business owner is able to do many of the roles within the business.
However, there comes a time in the business when you need to hire a professional accountant to help manage your business. If any of our signs trigger a reaction, you are ready for an expert!
1. Turnover has increased but profits haven’t. More money coming in must mean more profit right? Not necessarily! This is a good time to have an accountant review your books and identify areas where your expenses can be improved to make a significant difference to the bottom line.
2. GST - this might seem simple, especially if you have invested in a software package such as Xero. This makes it feel as though managing GST is easy. However, there are a few pitfalls that new businesses can get trapped in when it comes to GST. If you are registered for GST then it is best to get some advice from an accountant.
3. Feeling overwhelmed. When you first started your business the invoices were pretty simple. You had a few customers and you collected the money and gave them a receipt. But as the business has grown you might be experience more complicated scenarios. When it starts to get tricky, it's time to call your accountant.
4. You have better things to do. Once business is going well you will be too busy working on more technical areas of your business. This is where you are going to get the most return is if you focus on the things that you are good at.
5. Thinking of selling or expanding the business. When selling, expanding, taking on a partner, each scenario has a number of potential tax implications. It could cost you thousands of dollars if you don’t seek professional advice. A professional accountant can ensure that you have the correct structure to maximise your profits and minimise your liabilities when making big changes in your business.
6. Buying or selling property. Buying and selling property within a business structure can be tricky and there are many things that need to be considered. An accountant can walk you through all the scenarios to ensure that you choose the best outcome. You need to get this advice prior to making any purchases as once you have signed a contract it may be too late.
7. You’ve realised how little you know about accounting! You might have done an accounting subject at high school or uni, but times have changed and tax laws change constantly. It is best to get advice from someone who knows the current laws and how to maximise the opportunities.
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