London is thriving when it comes to small businesses and entrepreneurial dedication. There are more than 841,000 private sector businesses in the UK, 791,000 of them in London alone, more than any other region in the UK. Sadly, many of these enterprises will be failing when it comes to their finances. It’s one thing to have a business idea and turn it into something real; it’s another to turn your hand to accounting, which is why these tips may come in handy for all budding entrepreneurs and new business owners.
Keep it Simple Using Separate Accounts
If you begin using the same bank accounts and credit cards for the company and your personal life things will get complicated very quickly. One of the first things you should do is open separate accounts and make sure all the business transactions are kept completely separated from your personal transactions. You’ll save yourself a lot of time and make it so much easier to work out your deductible expenses.
Give Yourself Time
Schedule in time to work on your accounts and stick to your schedule each week. If you don’t make time you’ll find yourself creating a huge backload of work that will seriously eat into your downtime. One hour a week will make a huge difference. Use the time to sort out your finances and bring all your transactions up to date.
Keep a Track on Your Employees
Employees are one of the biggest expenses and yet many business owners fail to keep a close enough eye on these expenses. You must track all the wages you’re paying for employees and contractor fees along with their benefits, overtime, their expenses and all the other costs tied into labour. You’ll find it easier to ensure you’re not going over your budget and discover ways of ensuring you’re expenses pay off.
Chase Your Debtors
Track all payments from your customers and improve your systems so you get paid on time. Set up procedures to follow for all late payments and non-payments and record each payment. Make a note of how long your customers take to pay, which customers have been on your books the longest and the ones that are always difficult. Prioritise your workload based on your records and set up solutions for all problem areas to avoid problems with cash flow.
Get Help from the Pros
Find accountants in Central London and use their expertise so you eliminate the risk of errors. If you have no idea about accounts or lack the time to dedicate to your finances, visit www.gsmaccountants.co.uk and find out how they can help you to avoid penalties, save you money and ensure your business is more cost efficient. Technical aspects of accountancy need to be in the hands of professionals, don’t take risks.
These five tips are useful for all business owners, regardless of the size of the company. Whether you’re working on your own or in charge of a handful of employees already, you have to make sure you have your accounts perfectly managed.
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