Being a sole-trader means you are the exclusive owner of a business, and you have complete responsibility for every aspect of that business, finances included. Being a sole-trader is very tasking, and a lot of small business owners lose their businesses due to improper financial management. To avoid the challenges faced by sole-traders, you need to hire an accountant at different stages of your company’s growth.
Hiring an accountant to manage your business finances can be a know-how step to take whether you are just starting out, or you are up and running but looking to expand. Here are some varied reasons why you, as a sole-trader, need to hire a bookkeeper who will help your business develop.
It would help if you had advice about the legal structure of your business
Accountants aren’t there just to help with finances alone, they can also support by advising you about the legal structure of your business, as it is evident that not all businesses have the same legal structure. With the help of an accountant, you should carefully consider each type of structure before making your decision on the one that best suits your business. For example, you as a sole-trader, the exclusive owner of your business, and also invoicing under your own name, you might be able to counterbalance some of your living expenses against tax.
Minimizing tax liability
The amount of money you spend on tax depends on the amount of profit your business makes. It is evident that you as a sole-trader wants to make profit and keep hold of as much of the profit you make as possible so as to grow your business by reinvesting back in the business. Sole-traders need an accountant to make this possible and stay on top of all the changes in tax rules.
Full account management
As a sole-trader, you can transfer your account’s full management to your accountant, even though you’ll still be lawfully liable for their accuracy. What this mean is that they will be able to make use of their skills and expertise to manage your account on your behalf.
Saves you time
Accounting tasks consist of simple duties such as bookkeeping, tax returns, recording receipts and setting financial targets. These tasks are vital to business success and solidity, but they also take a lot of time. When you hire an accountant to manage your business finances, he/she saves you time by doing all the work needed to file your tax returns. Majority of sole-traders start their businesses doing what they love to do.
Accountants can help you center your business energies on the important things, which is predominantly money-making, while they take care of the other important things for you.
Could save you money
You might think that hiring an accountant is quite expensive, but the truth of the matter is that it is worth it. When you hire a good accountant, he/she will be able to point out any possible area where you can save money.
Should I hire an accountant?
At the end of it all, the answer to this question is determined by on your personal choice. Having discussed the reasons why you, as a sole-trader, need an accountant, the summary of it all is that it makes life easier. Hiring an accountant would be an excellent move to ease off the headache that comes with handling the financials of your business. Not only will an accountant keep your accounts in order, but they will also help foster the growth of your business.