If you are an owner of a small to medium-sized enterprise (SME), it is essential to consider the benefits of having a professional accountant.
Engaging with an accountant can significantly enhance your SME’s prospects by providing expert financial advice and managing your budget effectively.
Accountants ensure your business remains compliant with the latest legislative changes, including those announced in this year’s Spring Budget.
Streamlining payroll processes
Managing payroll is a critical function that impacts both your financial management and employee satisfaction.
An accountant can streamline payroll processes, ensuring accurate, timely compensation for your staff and the efficient handling of bonuses, deductions and payroll-related taxes.
This not only safeguards your business against potential financial and legal complications but also fosters a positive work environment.
In the Spring Budget 2024, the Government has announced adjustments to National Insurance Contributions (NICs) that will impact both employees and the self-employed.
The key changes to NICs are effective from 6 April 2024:
- The Government will lower the primary rate of Class 1 employee National Insurance contributions from ten per cent to eight per cent
- There will be an additional reduction of two pence in the main rate for self-employed National Insurance. This is in addition to the one pence reduction announced in the Autumn Statement.
- As a result, the primary rate of Class 4 National Insurance Contributions for self-employed individuals will drop from nine per cent to six per cent.
An accountant plays a crucial role in updating your payroll systems to reflect these changes accurately, ensuring your business remains compliant and that deductions are correct.
Saving valuable time
For business owners, time is precious.
Managing accounts, tax obligations, and bookkeeping can be cumbersome, diverting attention away from core business activities.
Delegating these tasks to an accountant frees up time that you can reinvest into strategic planning and business development.
Additionally, having a professional handle these aspects can eliminate the need for time-consuming corrections down the line.
Skilled guidance
Accountants bring a critical perspective to your business strategy and can help you identify potential pitfalls and advise on important aspects such as investment and resource management.
They will possess all the knowledge surrounding the new changes announced by the Government. For example, in the Spring Budget 2024, they would be aware of the significant increase in the VAT registration threshold to £90,000.
Their proficiency ensures your business can navigate and benefit from these changes effectively.
Effective budget management
Creating a budget for your small business is more complex than it might seem, requiring a thorough assessment of all potential expenses.
These can range from staff salaries and marketing to material costs, equipment upgrades, and overheads like rent and utilities.
An accountant’s expertise helps in differentiating essential expenditures from non-essential ones, allowing for the allocation of funds on a weekly, monthly or quarterly basis.
With professional guidance, adhering to your budget becomes more manageable, enabling more efficient spending and investment in your business’s growth.
Improving cash flow management
Effective cash flow management is vital for the sustainability of your business.
An accountant plays a pivotal role in forecasting financial changes, helping to predict periods of high expenditure or reduced revenue.
This forward-thinking helps your business maintain adequate funds to meet its obligations, so you can avoid financial problems.
Ensuring compliance
Maintaining compliance with regulatory requirements is fundamental to the success of your business.
An accountant assists in managing your tax returns, payrolls and other financial obligations, ensuring that your business adheres to all relevant laws and regulations.
This proactive approach to compliance mitigates the risk of penalties and legal issues, securing your business’s reputation.
If you would like to hear about our accounting services for SMEs, get in touch today to learn more.
