Accountants are necessary for the growth of most businesses, and at several stages, you will need the help of one.
Apart from managing your tax returns and payroll, they can also build the legal structure of your business and give advice. Here are 4 instances when you need to hire an accountant.
1- When you need to establish your business plan and legal structure
Two crucial stages in beginning your business are deciding the business plan and legal structure you want your company to follow.
A business plan can be daunting to write for someone without experience or a degree in the field. An accountant will help with financial projections for the future and other reports that help you make intelligent decisions.
There are different legal structures such as sole proprietors or partnerships, limited companies, and so on. Each has a different set of rules and factors guiding them, so making a mistake in choosing one can be costly. An accountant has the knowledge and experience to guide you as to which would suit your business
2- When the finances become too much for you to handle
After some time in the business, juggling your responsibilities of keeping the business open and handling the finances could get challenging. It might be time to get an accountant before you make costly mistakes or forget key business details about your finances.
An accountant can help put things back on track, so you will be fully aware of the financials of your business. Apart from that, you might also need key business metrics and payroll management which an accountant will be able to do excellently
3- When you want to apply for an overdraft or business loan
Getting a loan from banks is a long process and sometimes the request may be denied if you fail to pass their vetting process. For small businesses, it’s all the more difficult to get loans because banks need assurance that their money will come back to them.
Hire an accountant to help you make a strong case in presenting your loan request. Their knowledge can also help in answering any questions the banks might have even before they are asked.
4- When you have any dealings with the government
The paperwork involved while dealing with the government with tax returns or any other instance could be quite cumbersome and confusing. Apart from tax returns, you will need to deal with the government when filing compliance documents, maintaining records of administrative personnel, and so on.
An accountant would be a great asset in government dealings and will even help you save more money because of their knowledge of tax legislation. They can advise you on common mistakes not to make and expose you to ways you could raise capital to expand or open up more streams for cash flow.
Business owners can be pretty reluctant to hire accountants when they feel they can handle their finances without issues. This belief can land them in hot water, especially during transitional periods.
When your business is growing or going through a major transition, it will be a great asset to have an accountant on your side. Why don’t you focus on running your business and leave those pesky financial details for an accountant to worry about?