Getting you ready for the new financial year

Date: Wednesday, 02nd Mar 2016 | Category: Client, Consultancy, How to

We’re approaching that time of year again, no not Easter, the dreaded financial year-end.

We know it’s a time that makes most people want to hide under a blanket and disappear but unfortunately that is not possible (for the majority of us). That’s why we have put together this article to try and make it that little bit more bearable for you, and hopefully get you in good stead for 2016/17.

A survey by British Gas reported that 19% of small and medium sized enterprises (SMEs) have lost out financially at the year-end due to lack of preparation. It has been reported that many businesses believe that the lack of affordable and simple support available to help organisations correctly carry out the required procedures is the primary reason they end up in such troubling positions.

Over half of those surveyed (54%) think the support available to help them for the financial year-end is confusing and expensive. Almost half (40%) are worried about incurring fines for not meeting financial obligations, and over a quarter (27%) are concerned their lack of preparation could lead to them going out of business.

There is of course help available from accountants and software packages, if you can find one that works for you, but in the meantime here are our key tips to try and help you get yourself in order and make it all seem just that little bit easier:

1. Back it up

Our first piece of advice is to make a point-in-time backup outside your normal accounting system. The thought of doing this once may feel daunting but imagine losing it and having to re-do it all again.

2. Get your books in order

Do you have any invoices that need issuing? Unless you use the cash-based method for simplified accounting, you are required to add income to your accounts when you’ve earned it, not once it’s invoiced or paid for.

You should also try to collate all your receipts so you can claim tax relief on as many of your out-of-pocket expenses as possible. This includes expenses which you may not have paid actual cash for, for example mileage and business use of home. Why not create an ‘expenses’ jar for receipts going forward?

It is also important your books match up with your bank – if they don’t then now is the time to correct them. If you don’t have the right information it could lead to you spending money you don’t have or getting a fine from HMRC for inadequate book-keeping.

3. Buy it now

If you need a new piece of business equipment, for example a new computer, then buy it now before the end of the financial year. This way you will get capital allowances on that asset a whole year earlier.

4. Don’t panic

Our last tip is to keep your head! There are plenty of reasons the end of the financial year could be a good thing. Share some positives with your team about what you have achieved in the last 12 months and set some realistic goals and predications for the year ahead so they have something to work towards and motivate them.

Once everything is in order you will (hopefully) be able to see clearer and power on into 2016/17.

If you are facing any other business challenges then get in touch.

Give me a call directly on 01234 779 054 or email me at jazmine.brace@phew.org.uk and let’s have a chat about how to take your business forward.