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Are you thinking about hiring a business accountant? Are you wondering how they can benefit your small business? In this article we will highlight the services that business accountants offer and how these services can help your business.
Business Advisory vs Business Accounting
Firstly, it is important to understand the distinction between business advisory and business accounting. Business accountants assist businesses with the tax and compliance side of running a business, with most business services being clear-cut and technical.
Business advisors have a closer relationship with their clients and offer services to try and help a business grow. Business advisors are effectively mentors to help with business growth and offer tailored solutions to the business depending on their situation.
Small Business Essential Services
A good small business accountant can help you from the startup of your business all the way to retiring and selling your business along with everything in between. Your accountant should be trustworthy as they are dealing with your financial affairs so small mistakes can have big consequences.
Structuring your business correctly will set your business up for future success. By hiring a professional small business accountant, you will be offered tailored accounting solutions and get set up with the correct business structure, so your business is ready from the start.
Your accountant should assist with choosing the appropriate business structure, applying for an ABN, and registering the business for GST and PAYG-W if applicable. Every business is different and that's why it is important your accountant understands your situation and provides guidance on the different business structures with the benefits and disadvantages of each.
Technology is now a vital part of running most businesses. Your accountant should recognise this and be up to date with technological processes and software that can be implemented and benefit your business.
They should be able to offer guidance, assist with the implementation of cloud-based accounting software and highlight the positives of the software and how it will assist your business.
Proper preparation and planning are essential for business success. Your small business accountant should offer a consultation to assist with setting up your business.
They should be experienced with small business payroll and support you with ensuring the correct processes are followed when hiring employees, paying wages, and making superannuation contributions.
Some business accountants are also business coaches which means they also assist with business strategy by helping create a tailored business plan to aid you in achieving your business goals. Check out our other blog about whether hiring a small business coach is right for you!
All small business owners need to understand bookkeeping. A good, professional accountant can assist you with all aspects of bookkeeping. As a small business owner, having a good bookkeeping system and reconciliation process is essential to prevent issues with GST and Income Tax reporting.
Your accountant should be able to offer bookkeeping services to help your small business with all the ongoing reporting obligations, or if you want to do the bookkeeping yourself, they should be able to assist with training on how to do it correctly and prevent errors.
A small business accountant can assist with lodging business activity statements (BAS) and instalment activity statements (IAS), to ensure you are lodging them on time and getting the best outcome.
A good accountant will assist with payroll administration and processing. Payroll can be confusing, so your accountant should be able to explain your obligations and make the process of paying staff effortless.
Inventory monitoring is vital to ensure positive cash flow and profitability. Your accountant should be able to assist with software or systems for monitoring your stock, so you are aware of the profitability and areas which could be improved. We discuss asset management and its benefits in our article about cash flow management.
Business Tax Accountant Essentials
Most small business accountants offer services based around assisting with your tax return preparation. Your tax accountant should be trustworthy and an expert in their field to ensure compliance with the Australian Taxation Office (ATO) and to safeguard you against penalties and fines.
A public practice accountant should be able to help with all aspects of taxation for a business. A proficient accountant will be able to assist with preparing your individual and business tax returns in a manner that maximises your tax deductions and ensures you pay the correct amount of tax.
Small business tax can be complicated which is why small business owners should enquire about a tax planning service that will help you navigate the intricacies of the tax system and minimise your tax payable.
Your tax accountant should be able to provide business advice and strategies to help minimise tax for the current and future financial years.
Everyone wants to avoid ATO audits as they can be stressful and confusing to navigate. A small business accountant should inspire confidence if you do have an ATO audit, that there is nothing to be concerned about and will help you navigate the ATO’s questions and requests.
Your small business accountant can provide advice on how to ensure your record keeping and documentation is correct and up to date. They should manage the audit process and speak to the ATO on your behalf, taking the stress off your shoulders, while also ensuring the best outcome.
Goods and service tax (GST) obligations can be difficult to understand. Your accountant can help you identify if you should register for GST and how to navigate it when setting up a business.
Once your business is established, your accountant should check that you are compliant with your tax obligations and assist with record keeping requirements.
Pay as you go instalments (PAYG-I) are required by the ATO once your business is liable for income tax and is payable on a quarterly or monthly basis.
Navigating this when you are self-employed can be difficult. Your accountant can help you plan and prepare for PAYG obligations and income tax payable with tax planning services, which will help to avoid an unexpected tax bill or ATO interest charges on outstanding tax.
Small Business Accounting Essentials
An accountant should not only assist with tax returns but also assist with the preparation of financial reports which are required when running a business. This is especially important for small business owners where financial health is vital.
Your small business accountant should be able to analyse your business accounts and create financial reports that can assist with getting a business loan or better understand your business's financial health.
Most accounting firms perform reconciliations when preparing financial reports by gaining access to financial documents such as bank statements to confirm the correct balances and then use this information to produce profit and loss statements and balance sheets.
Accounting software is beneficial to your business and when choosing accounting software, you should get advice from your accountant on the benefits of the various options. If your small business is growing rapidly, having up-to-date software is essential for generating reports to help manage the growth in a sustainable way.
Small business accountants should provide recommendations on the best software for your business that will help with record keeping. Competent record keeping will assist with the daily management of the business and the preparation of financial reports and tax returns.
Selling Your Small Business
As a small business owner, you want to ensure you get the best outcome when the time comes for you to sell your business. A small business accountant should provide valuable assistance when you are selling your business.
Most businesses have a long-term relationship with their accountant before selling, so most accountants thoroughly understand the business and the individual’s goals.
A small business accountant can prepare a business valuation to provide guidance on how much the business is worth to any potential buyers. They should assist with preparing specific financial statements which will be requested by the purchaser and help with the process of selling your small business.
Preparation is vital when it comes to selling your small business to ensure you maximise the value of the business. Small business accountants should assist you in getting your financial affairs in the optimal position for the sale of the business.
A tax accountant will also advise you on the tax implications from the sale of the business and the options available to you.
Small Business Owner Essentials
What small business accounting services are currently available from your accountant? Accountants are essential for small businesses to succeed, but not all accountants offer all the services that are listed in this article.
If you are interested in the benefits provided from any of these services, Coleman Advisory offers all these services and more, You can book a free 15 minute consultation to see if we are the right fit for you!
The information provided on this tax blog is intended for general informational purposes only and should not be considered as professional tax advice. While we strive to ensure the accuracy and currency of the content, tax laws and regulations are subject to change, and individual circumstances may vary. We recommend consulting a qualified tax professional or seeking advice from the Australian Taxation Office (ATO) for personalized guidance tailored to your specific situation. The authors and creators of this blog disclaim any liability for errors, omissions, or inaccuracies in the information provided. Use the information at your own discretion, and always exercise caution when making financial or tax-related decisions.