Do I Need an Accountant for My Small Business?
Many owners of small businesses wonder if they need to work with a business accountant. Some are convinced that they can handle their taxes on their own. Others are on the fence. Shifting the burden of doing taxes sounds very attractive, but you may wonder if you are too small to need an accountant. That is why we’ve prepared this handy blog to answer all of your questions.
If similar questions run through your mind, you will likely benefit from a closer look at small business accounting and the ways your company can benefit from a dedicated team of professionals.
What Counts as a Small Business?
To be considered a small business, a company must have an annual turnover of less than ten million dollars. An exception to this relates to the small business CGT concessions which lower the threshold to two-million dollars.
You should note that Australian tax law requires businesses to calculate their annual turnover from aggregated amounts. This means all affiliates of a company will add their turnover together, making a single amount. The law exists to stop businesses from splitting into subsidiaries with lower turnover amounts, as this would give the company access to greater concessions.
Why Use a Professional for Your Small Business Accounting?
Many small business owners struggle with the pros and cons of hiring a small business accounting team. You are likely used to wearing many hats as you run your business, which is to be expected in some respects. However, several positions are best left to someone who specialises in them. Accounting is one such profession. There are several ways a small business can benefit from hiring an accountant, and the list of vital matters an expert will manage for you may surprise you.
- Help start your business the correct way by advising you regarding vital and sometimes overlooked areas, like:
- Tax and compliance issues
- Proper separating of business and personal finances
- Record-keeping guidance
- Business Software
- Ensuring you are meeting government requirements and regulations
- Consult with you regarding business strategy and help craft a strategic approach resulting in an efficient business plan
- Advise you as your business grows so you can:
- Develop a strategy to build wealth for your business
- Understand revenue and forecasts
- Protect your profits and maximise earnings
- Help you achieve a better ROI
- Hire staff at the right time, control costs, and secure your profitability
- Create a successful financial plan
- Minimise your risks
- Give you more time to run your business
- Direct your cash flow
- Help you manage your business relying on our team of professionals with decades of experience in the areas of:
- Business accounting – including accountants experienced in small business accounting
- Business management and advisory
- Taxation for businesses of all sizes
- Create a plan to manage your debt
- Save you money
- Improve how your taxes are managed
- Create an exit strategy so you are prepared well in advance for any events that would lead to you wanting to leave your company. These preparations include:
- A reliable valuation of assets, along with your business’ profit potential.
- A business system that you will be proud of.
- An efficient succession plan, which tells how your business will
- operate when it has a new owner.
- Professionally prepared documentation of your financials
What Does an Accountant for a Small Business Do for Their Clients?
A small business accountant has a great many tasks. This is why you need to work with the best small business accountant in Perth. Your accountant will do the following:
- Advise you on the most advantageous business strategy
- Offer insight into personal finances
- Audit your cash flow
- Facilitate payments from companies and individuals who owe you money
- Discover ways to cut costs
- Help you form your business
- Take care of opening new bank accounts as needed
- Help put together a business plan
- Oversee your debt
- Control your inventory
- Take charge of your payroll
- Create and assist in implementing budgets
- Prevent audits
- Suggest the business tools that will work best in your company
- Set up your accounting software
- Create and present loan applications
- Manage your year-end financial reporting
Can I Do the Accounting Work for My Company?
Some business owners do their accounting and feel comfortable taking on the massive number of tasks associated with the position. However, many business owners would never consider going back to doing their business accounting due to the following benefits:
- Saves You Time – As previously discussed, the workload of small business accountants in Perth is sizeable. You are already busy doing what you do best, running your company. Hiring an accounting firm removes hours of extra work from your day.
- Greater Accuracy – Even the savviest business person knows they have limitations. You will do your company a disservice if you take on the role of an accountant if you have little or no understanding of the task before you. Allowing an experienced professional to take care of your accounting needs means there will be fewer mistakes. Remember, the ATO will not give you a break because you do not know how to do your business taxes.
- Improved Business Growth – No doubt your business will grow and benefit from your ability to focus on it and not your accounting. Additionally, your accounting professional will bring their skills and experience to your doorstep. By taking advantage of your accountant’s input, you will open yourself up to much success.
- Maximises Your Tax Deductions – Tax time can be stressful, especially if you are navigating business taxes. Can you honestly say you know all the items you can deduct from your taxes? Your accountant knows what deductions you can get and ways to increase the money you will get back.
If you are considering hiring an accounting firm to take care of your company’s financials but would like to learn the details involved, do not hesitate to contact M2 Corporate. We are one of Perth’s leading boutique accounting firms and have decades of experience helping businesses of all sizes. Our business professionals can answer your questions and arrange a meeting to get to know you and your company.