Whether your small business is still a dream awaiting realisation, an established venture already bringing in money, or a new start up in it’s fledgling form, keeping on top of your budget is vital. You should be aware of any costs your organisation will incur, keep adjusting your budget as expenses and income fluctuate, and ensure you have enough money due in to cover all costs. It’s also important to be prepared for unforeseen expenses, as these can crop up when you least expect it, ruining your carefully planned cash flow.
Below are some of the most important expenses most small businesses will face, as well as a few that are often forgotten when it comes to planning company outgoings. Many expenses are tax deductible too, meaning you won’t have to pay tax on the amount you spend.
You may have chosen to keep marketing in-house to reduce your operating costs; this can be a good idea, especially during business start up when you may not have much budget spare. Although Facebook, Twitter and other social media platforms are free to use to post information about your business offering, you might find that a small budget is required to boost several of your posts, in order to reach more users and pick up more social signals for your company, so don’t forget to factor these costs into the monthly budget.
One important consideration is how you are planning to keep track of your finances. There are some great accounting software packages available, which can help make life much easier for you when it comes to invoicing customers, tracking income and expenditure, predicting upcoming cash flow; all financial aspects of your business. As indispensable as these resources prove, they can’t take the place of the expert advice and guidance you will receive from an accountant. Many accountants offer their services at a fixed monthly fee, making it easy to budget for this cost and ensuring you don’t have to pay a big one-off fee when it comes time to complete your annual accounts. If you think you could benefit from professional advice, why not get in touch with the friendly team at Neil Smith Accountancy?
Taxes & Filing Fees
Don’t forget that if your small business is VAT registered, you will have to factor in paying quarterly VAT bills. Depending on the amount of profit made by your organisation, there is also Corporation Tax to account for. In addition, there are filing fees to be paid when the time comes to submit your return.
As your small business grows, you may find you need extra hands on deck to cover the increasing workload, or to provide a skillset you don’t have. So even if you’re doing great as a one-person operation so far, don’t count out the possibility of wage costs piling onto your monthly expenses. Depending on the needs of your business, you may find it cheaper to staff up with freelancers rather than salaried employees.
This may be a cost you won’t see returns on, however appropriate business insurance is advised as it can save you money in the long run, should you ever need it. There are a number of different insurance types you should be aware of as a business owner, from professional liability insurance, protecting you from claims as a result of poor performance; through property and vehicle insurance; to workers’ compensation insurance, a must if you employee staff. Not all of these are obligatory or even advised for all companies, so look into what is best for your specific business needs before committing to a policy.
If you are considering raising capital to help with cash flow, learn more about business loans and credit cards and find out which might work best for your needs.
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