It is a personal choice to do your own taxes, and one of the main factors that influence your decision will be how many income streams you have and what kinds of income you earn. If you have income from multiple sources, then having an accountant to handle your taxes for you and complete your tax return may save you much more than it costs – and save you precious time, too.
Often, sole traders and small businesses see accountants as an inconvenience; someone they have to speak to once a year when sorting out those annoying tax forms! However, good accountants can be used as a key tool for growing your business. Here are our top five ways to get the most from your accountant.
- Give them the right information
In an ideal world your accountant would follow you around, recording and considering all of your financial transactions and advising you of the tax implications. Fortunately, accountants generally don’t have the time or desire to stalk their clients 24 hours a day. Unfortunately, they depend on you to give them a complete and accurate summary of your financial year!
A good accountant can usually draw out the relevant information with some basic questions, but the more effort you put into the basics, the less time you’ll have to spend on getting what you actually came for – an informed opinion on how you did with your finances from a tax perspective, and advice on how to minimise your taxes going forward. So in simple terms, your first step in getting the most out of your accountant is to create an accurate and concise snapshot of your finances.
- Tap into their networks
As a small business it is likely that the accountant you’re using is also working for a host of other businesses. Ask your accountant if they’re willing to initiate relationships between you and other clients. This could lead to business deals, partnerships or a support network of people facing the same problems as you.
- Value their advice
Rather than spending a fortune on someone to organise your accounts, you should use accounting software to stay on top of the books and spend your money on advice instead. For this reason it is important to find an accountant that you can learn from. Your accountant will have expert knowledge of not only your business but of the industry it is based in. This means that they can help you uncover ways of expanding your business and reducing your costs, as well as indicating areas where you need to spend more. It’s likely that any problem you face will be familiar to an experienced accountant, so they will most likely know how to solve it.
- Never lie!
Doctors can save your life, lawyers can save your freedom and accountants can save your livelihood, so always tell them the truth. Accountants need to know every fact about your business so they can work out how much tax you pay and how your business can make the maximum amount of profit. If you lie to them about your finances, this could lead to mistakes in your bookkeeping and possibly even the downfall of your business.
- Arrange regular catch ups
Accountants usually have a large number of clients, meaning you can’t rely on them to contact you all the time. You should arrange to have monthly meetings or weekly phone calls with them, allowing you to discuss any problems you have before they gets too big. If you delay speaking to them and then dump all of your difficulties on them at the end of the tax year, problems may escalate and cause a last minute panic.
Remember: accountants can be an invaluable business tool, so ensure you make the most of them. They’re there to help, not hinder!