Half of all startups in the U.S. fail within five years. Another 25 percent survive for one year or less. Poor financial planning is often the culprit.
As a small business owner, you might prefer to do your taxes on your own. Perhaps you’re planning to hire an accountant later. Right now, you’re trying to keep the costs low and avoid unnecessary expenses.
Hiring a tax return accountant is one of the best things you can do for your business. Even though it requires extra costs, it’ll save you money in the long run.
Accounting services can help you prevent costly mistakes, such as mixing up personal and business finances. Data entry errors are common too. Unsolved, these issues could result in hefty fines.
Still not convinced that you need an accountant? Here are five reasons to hire one for your small business:
1. Avoid Common Accounting Mistakes
Companies of all sizes make accounting mistakes. Small business owners are more likely to do something wrong due to their lack of experience.
For example, you may fail to properly categorize income and expenses. Let’s say you’re dealing with dozens of customers and suppliers. In this case, it can be difficult to keep track of who was billed and how much.
A skilled accountant will use accounts payable automation software solutions and other programs to streamline these operations. This will reduce your workload and make it easier to track your payments.
2. Identify Potential Deductions
Don’t wait until the tax season kicks in to determine how to get all your deductions. Professional accountants can inform about these aspects in advance so you can plan your budget more efficiently.
For instance, you may not be aware that you can deduct expenses for the business use of your home. Small business owners can capitalize on startup costs, state and local taxes, factory overhead, and more.
3. Make Smarter Business Decisions
When you hire an accountant, you’ll gain a new perspective on financial planning and other key aspects of your business.
Those who work in this field stay on top of the latest market and economic trends. They know what works and what doesn’t work, and can help you assess the viability of future projects.
An experienced accountant may also recommend changing your business structure or form of incorporation. If you’re planning to register your company in a different country or state, ask for his advice.
4. Free Up Your Time
Tax planning is complex and time-consuming. Why spend hours doing your own taxes when you could hire a professional? This will free up your time so you can focus on the core aspects of your business.
By hiring an accountant, you’ll get more done in less time. The same goes for other activities that can be outsourced, such as IT and administrative tasks.
5. Invest More Wisely
Are you a real estate expert? What about a stock market genius? Probably not.
Unless you know these markets inside out, it’s risky to make investments. Sure, you want to grow your small business, but you may end up going bankrupt despite your best intentions.
An experienced accountant can advise you and share his knowledge in these areas. His clients include real estate brokers, bankers, and other professionals, so he’s quite familiar with these aspects.
Hire an Accountant to Make Your Life Easier
Over 40% of entrepreneurs say that booking and tax planning are the worst parts of running a business. About 13% are struggling with administrative tasks, while 47% percent complain about paperwork.
Don’t let these issues take over your life! Hire an accountant so you can have more time for yourself and your business. Accounting services can save you a lot of stress and boost your revenue.
Need more small business tips? From starting a company to marketing your products, we got you covered. Check out our blog to find out more!