Keeping HMRC happy, sleeping soundly and growing your business.

31 Jan
If you are like most business owners you work hard through the year and then it comes to the time when HMRC appears on your radar. Its time for self assessment or if you run a limited company declaring profits to pay Corporation Tax on.
Trying to find all the receipts, checking your online purchases and printing those receipts as well.The last thing you want is to pay more tax than is absolutely necessary.

If the January panic is familiar territory for you, the real issue is that your accountants life and business activities is run by deadlines, and when you talk to him/her about your accounts this is what they think of first, what deadlines have to be met.
You however, are running a business and although you need to meet deadlines so that you don’t run into fines for missing them you need your financial information every month so you can manage, direct and grow your business.
Are you typical of many business owners who speak to their accountants once a year?
I remember being told by my first accountant not to worry as the deadline for submitting to HMRC was 9 months after the year end.
The big problem with operating  in this fashion is that you do not know how your Company has performed and you are 9 months into the new financial year.
No wonder so many businesses do not survive! and the ones that  do are not fulfilling their owners aspirations.
I hope you are reading this in time!
Getting your business to grow, work and fulfill its promise is not just about working harder and keeping customers happy.
What is it about then?
One of the magic ingredients is to have a financial plan and monthly reporting based against your plan.
If you don’t like preparing reports and the administration of keeping it all up together then get your accountant to produce them for you. Maybe your bookeeper could do your monthly reporting at a better price?
What should you be tracking every month? This is the minimum I recommend.
1. Sales Revenues.
2. Gross Profit.
3. Costs.
4. Net Profit.
The above from a profit and loss statement.
The other critical report is a CashFlow statement. This will anticipate your cash balance in your  current account.
Discuss with your coach what are  the other metrics (as well as financials) you should keep track of each month to ensure you are on track.
The above will allow you to make sense of paying HMRC what they are owed and allow you to transfer enough funds into your tax account on a monthly basis, so there will no nasty surprises.

Steve helps owners of SME’s with profits, teams and dependence on personal input, to learn more click

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