“Failure To Prepare Is Preparing To Fail”
Benjamin Franklin
Ready To Take Your Business To The Next Level?
So you have a great idea for a business and you are excited about it. You decide to step out and start that business as you are confident that customers are just waiting for your product or service. Perhaps, you did your market research and have identified your target market so what else can possibly stop you from achieving your success?
Operating a successful business takes much more than offering a service or selling a product and receiving payments for it. Understanding the difference between gross revenue and actual profit or managing cash flow, is really important to know.
Laying the right foundation from the start can make the difference in the future longevity and sustainability of the business. You need a strategy or blueprint that’s laid out with clear directions and a path for where you are heading.
Accountants Add Value To Your Business
As Accountants, we provide high value for our clients in many ways. My clients know that they can sleep well at night from knowing that their books are in the best hands. There are many responsibilities that come along with operating a successful business and sometimes it can be very overwhelming.
There is much value to be gained by working with a professional. Some business owners think that they can’t afford to hire an accountant. Well, I would advise that you can’t afford not to. Some of the mistakes you can make from a lack of knowledge can be costly and in the end, you may spend much more than you bargained for.
- Your accountant knows how to classify and record transactions as required
- By handling your books, you get to focus on other aspects of running the business
- They can offer cost saving strategies
- Having your books accurately maintained minimizes the risk of failure to pay your taxes
Accurate record-keeping is essential to effective business management; however, it is an area where some business owners can fall short. Keeping up with customer demands usually takes priority. After all, happy and paying customers guarantees revenue.
A wise move is to hire an accountant or outsource to an accounting professional as early as possible so that your books can be set up accurately. Banks or Investors are more likely to grant loans or invest in your business when you are able to produce financials. Numbers are important.
Let’s talk a little bit about taxes. This is the most underestimated or overlooked area for some as they embark on forming their business. It may seem like the least important but on the contrary, it plays a huge part in the decision making process.
For example, the S-Corp is a designation for tax purposes. LLC’s can make an election to be treated as either a C-Corp or an S-Corp for the benefit of not having to pay the self-employment taxes. If they are paid a salary, then the corporation pays the payroll taxes.
Oftentimes when tax season comes around, some small business owners go into a state of panic when they are made aware of having to pay self-employment taxes. Making quarterly estimated taxes will reduce the risk of incurring a penalty for underpayment of taxes.
It is highly recommended that before getting into business, take the time to research and make sure that you are aware of the tax obligations on the federal level as well as that of your state.
Key Takeaway Points
- Research the advantages and disadvantages of the different forms of business structure.
- Implement a bookkeeping system or seek assistance from an accounting professional.
- Take time to understand the tax obligations that are applicable for your business.
- Stay abreast of annual reporting and other compliance requirements.
- Network and form alliances with other businesses or professionals in your industry.
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SLS Accounting & Business Consulting Services works with business owners throughout the Bronx and New York City regions, offering one-to-one coaching to those who are just starting out or are considering starting a business. Get equipped with the tools needed to operate a successful small business. Minority and women-owned businesses are welcomed!