5 Reasons All New Business Owners Need Professional Accounting Services

In Business Skills, Management Skills
New Business Owners Need Professional Accounting Services

Professional accounting services may seem unnecessary when your enterprise is in its early stages, but this is when you can truly benefit from the guidance of a bookkeeper, accountant, or certified public accountant (CPA). As you get your small business up and running, accounting professionals can help with everything from choosing a legal structure to writing a business plan while also helping you to understand your tax obligations as a new business owner.

Below, the team at Skillonpage share five of the reasons why every new business owner needs professional accounting services and how entrepreneurs can find the right accountant for their specific business needs.

Business Formation

Professional accounting services aren’t just for existing companies: They’re also helpful when writing a business plan, choosing a legal structure, and forming a small business. Writing a realistic business plan is one of the first steps you’ll need to take when starting a small business, and an accounting professional can help to identify your financial needs and improve your chances of following through on your plans.

In addition to helping you with your business plan, an accounting professional can advise you on the best legal structure for your small business. Sole proprietorships are the least complex form of business ownership, but partnerships, corporations, and limited liability companies (LLCs) are other popular options for business owners.

For many entrepreneurs and small business owners, forming an LLC makes the most sense. By creating an LLC with your state of residence, you’ll keep your personal and business assets separate from one another and protect yourself from personal liability in the event that your business is sued. Plus, as much as $5,000 in organizational expenses may be deducted on your annual tax return, and you’ll be taxed as a pass-through business.

Furthermore, a professional can help you to choose the right type of accounting software for your small business and get your new accounting software set up and ready to be used. Several great options for small businesses include FreshBooks, Intuit QuickBooks, Sage Business Cloud Accounting, AccountEdge Pro, Wave Accounting, and Xero.

Startup Financing

As mentioned in the section above, an accounting professional can help you to write a realistic business plan for your small business, which will be hugely beneficial if you need to secure startup financing. If you plan to apply for a small business loan, for instance, an accountant can help you to choose the best financing option and even improve your chances of qualifying for a loan. If your lender has questions or concerns about your loan application, your accountant can speak to the lender on your behalf.

Taxes

Small business tax preparation is another important reason to enlist the help of an accounting professional, as your business tax returns will be much more complicated than what you may be used to with your personal returns. Plus, tax codes and laws are always changing, and these rules can be difficult for the average taxpayer to track down and understand.

At tax time, an accounting professional can also help you with:

  • Reviewing your financial statements for accuracy.
  • Addressing your tax questions or concerns.
  • Claiming business-related tax deductions and credits.
  • Preparing and filing your annual business tax return.

Before meeting with your tax preparer, be sure to gather your personal information (including your Social Security Number and Employer Identification Number, if applicable) — and records of your assets, loans, income, and expenses. You’ll also need to present copies of your financial reports, including a balance sheet, cash flow statement, and profit and loss report.

Financial Management

In addition to preparing your business tax return and getting your small business off the ground, an experienced accounting professional can help you to manage the day-to-day operations of running your business. As a few examples, your accountant, CPA, or bookkeeper can help with:

  • Tracking business expenses.
  • Monitoring your business accounts.
  • Paying quarterly estimated taxes.
  • Paying employees and independent contractors.
  • Creating a budget for your small business.

Peace of Mind

As a new entrepreneur or small business owner, professional accounting services will provide you with the expertise you need to launch, run, and grow your small business — and achieve long-term financial success. You’ll need to pay a fee for these services, of course, but you’ll reduce spending in other ways — and save a whole lot of time in the process. Plus, your accounting and bookkeeping expenses may be deducted from your business taxes. And for many, the advantages of hiring an accounting professional is well worth the cost.

How to Find Professional Accounting Services

Fortunately, finding and hiring an accountant, CPA, or bookkeeper isn’t difficult if you know what you’re looking for and have an idea of what you’re willing to spend on professional accounting services. According to FreshBooks, CPAs charge the highest fees, but accountants (those without CPA designations) charge hourly rates of $20 to $100 or more. Bookkeepers are the most affordable option, charging an average of $16.67 per hour.

Depending on your accounting needs and budget, it may be best to hire an accountant when launching your business and to file your business tax return — and hiring a bookkeeper to record your earnings, payments, receipts, and purchases. As your business grows and budget allows, you may wish to enlist the help of a CPA, especially if you’ve been audited or need complex financial advice.

To find the best accounting professional for your small business, start by performing an online search for accountants, bookkeepers, or CPAs near you. Or, you could obtain recommendations from other entrepreneurs and business owners in your industry. You can also use websites like Upwork to find freelance accountants and bookkeepers for hire, as well as other professionals such as financial planners and legal advisors. Many business owners prefer face-to-face meetings with their accountants, but virtual accounting services are also available.

The Bottom Line

Professional accounting services will be critical to you as you get your small business up and running — especially if you don’t have the time, knowledge, or understanding to manage your own accounting activities. By paying for professional accounting services, you’ll start your business off on the right foot — and ensure a strong financial future for yourself and the business you’ve worked so hard to create!

Are you ready to build new skills in areas such as business, art, and education? Visit Skillonpage.com to learn new skills from the comfort of your computer!

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