Small business owners often long for the day when they can focus on running and growing their business. Depending on the workload, hiring a part-time accountant or even a full-time accountant can be the solution. It may be the only way to escape the necessary financial paperwork that limits your time.
Hiring an accountant for small businesses
Here’s a snippet of duties an accountant can take off your plate:Quarterly and annual tax returnsProviding financial documents for loan and grant applicationsActing as a financial advisorDoing payrollHandling billing and tracking payments
Why you should consider hiring an accountant
Why do small businesses need an accountant? Here are a few good reasons why a small business owner needs an accountant (and not just for tax season).
Perfect financial statements and financial data
Enlisting a professional to prepare financial statements gives you an at-a-glance snapshot of your company’s financial information. Without the ability to perform regular financial analysis, you can lose track of your goals and stray from your plans.
Comply with tax laws and maximize tax savings
When you’re in the business of running your own business, the corporate accounting tasks can be put aside. A good accountant can help you with tax planning and make sure you get tax write-offs when it comes time to file tax returns. Certified public accountants will also keep your business in line by complying with the latest tax laws.
By working with accounting professionals, you have more time to focus on the day-to-day tasks of running the business, rather than accounting tasks. The right accountant can handle all the necessary business taxes, with a view to helping you with financial planning.
Apply for loans or grants
If you want to apply for a scholarship or loan, information about the company’s finances is easily accessible. Financial reports and other information about the company’s finances are the responsibility of your accountant, who will prepare statements as necessary. The accountant’s services also lend a certain professionalism to the reputation of your company.
Certified accountants and audit firms offer an important advantage. You are represented during an audit. According to data from accounting firms, you are less likely to be audited if your tax return indicates your professional relationship with an accountant.
Tax returns? Cross them off your list. Accuracy of your bank account? Draw a line through that too. If you hire someone with extensive knowledge of the financial side of your business, you can worry less and focus on growing your business.
When to hire an accountant?
Many small business owners put off hiring an accountant until it becomes painfully clear that such services are needed.
During that time you may be missing something. There may be an accounting system that can make your life easier. You may need tax advice. You may not have written down your financial goals yet.
If you’re not ready to hire a full-time accountant, consider starting with a part-time accountant. Many accounting firms offer these services and you may actually save money.
Keep in mind that the fees you pay to an accountant are tax deductible as business expenses. In fact, you may want to include accounting costs in your long-term business plan.
How much does it cost to hire an accountant?
Costs vary depending on the extent of the accounting services you require. The costs also vary by the level of education (certified public accountant with a college degree) and the accountant’s level of experience.
If you hire a self-employed accountant as a subcontractor, you should expect to pay at least $40 as an hourly rate. If you work at an accounting firm, you will pay $100 to $250 per hour.
How to hire an accountant?
How do you find that person with the financial knowledge that fits how your company works? Financial needs and tax situations vary by company. For example, sole proprietorships do not have the same needs as owners with employees.
1. List the services you would like to transfer to an accountant.
2. Network with other entrepreneurs to find out which accountants or accounting firms they like and why.
3. Armed with a list of accounting interview questions to ask, make an appointment. There may be accountants or firms that offer a free consultation.
4. During the hiring process, discuss costs, including likely compensation per job, financial statements, financial reporting, payroll, initial tax return, and any tax issues.
5. If you’re running a new business, ask for accounting software recommendations as part of the application process.
Tasks for a bookkeeper
Typical accounting services include cash flow tracking. A bookkeeper manages bank accounts, handles invoices and payments, and records transactions such as paying for purchases.
Hiring someone to take care of the bookkeeping can be an intermediate step. It can also ensure that you provide proper records to an accountant.
Accountant vs Using Accounting Software
There are some excellent choices for accounting software. Accounting software can make your tasks easier, and it can also make your accountant’s tasks easier.
There are things accounting software can’t do: A computer program doesn’t offer advice or tips on how to change tax laws.
Freelance vs Full-time Accountant
When do you need a personnel accountant?
In a perfect world, that freelance accountant or subcontractor accountant becomes your full-time accountant. You get a person who already knows your company.
You may be able to justify hiring a full-time accountant when adding tasks. For example, you are going to hire staff.
Does an accountant save a company money?
Yes. You can make financial savings in the form of tax breaks you didn’t use, or by writing off accounting expenses.
Here’s one way to consider that decision: You may feel like you’re paying an accountant higher wages than you would pay yourself. But remember that it would take much longer to do the same job and you will spend time running your business.
Is Hiring an Accountant Worth It?
Yes. Even if you only suffer from stomach cramps and headaches during load time. When something goes wrong with taxes, there are consequences. Hiring an accountant or accounting firm will reduce your stress.
Image: DepositphotosMore in: Small Business Accounting
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