Organized Finances Ensure Business Success

English: Findlay, Ohio, September 20, 2007 -- ...
English: Findlay, Ohio, September 20, 2007 — Gilbert Yingling, a representative with Small Business Administration (SBA) makes calls to local business owners from a local chamber of commerce business directory as part of an SBA outreach program. He then follows up with person to person meetings with the business owners. John Ficara/FEMA (Photo credit: Wikipedia)

It is important for any business to keep its finances in order. Numerous websites stress this, such as the Scott Reiman crunchbase profile. Having organized finances ensures that business owners will always be able to know where their businesses stand and whether or not they are incurring profits or losses. If they are incurring losses, then they might need to reevaluate their business structure and marketing tactics and change them to find a more effective solution that works. It is also important for businesses to have their finances in order for tax purposes as well. There are a few tips that business owners can keep in mind to help keep their business’s finances organized.

Retain a CPA

Retain the services of a certified public accountant. Accountants are one of the most important resources that a business can have. Accountants are skilled in ensuring that finances are in proper order. They are also invaluable to helping business owners make informed decisions concerning their businesses. Accountants can generate virtually any type of business report that owners need to determine where their business stands in the way of successfulness.

Re-evaluate Business Entity

Many business owners begin their businesses as sole proprietorships or partnerships. However, over time and with expansion, it might be ideal for them to incorporate their businesses or form an LLC that can help shelter them from financial risks. Incorporating a business entity or forming an LLC can also help business owners save money on their taxes. Additionally, failing to adjust a business’s entity to accommodate a different income level could end up being a costly mistake. Business owners might want to discuss their different entity options with a CPA so that they can determine the right entities for their businesses and the appropriate times to make any changes, if necessary.

Review Estimated Tax Payments

Business owners have to pay estimated tax payments, which are quarterly payments. Underestimating estimated tax payments can result in penalties for businesses, so when estimating estimated tax payments, round up rather than down. It is better to overpay than to underpay because anything that is overpaid will be returned back the business in the long run when tax refund time rolls around. By properly estimating taxes, business owners can prevent underpaying and overpaying, though. Reviewing what the business has earned year to date and then projecting what it is expected to earn throughout the rest of the year is how estimated taxes are discerned.

Keep Business and Personal Finances Separate

One of the most important rules to managing business finances is to keep them separate from any personal finances. Although this is not mandatory for sole proprietorships, it is mandatory for corporations or LLCs. It is still a good practice for all business owners to employ, though. Open up separate accounts strictly for the business that are separate from any personal accounts. Likewise, have debit cards that are solely for the business as well. It is also a good idea to open up a dedicated savings account or money market account where approximately 25 percent of each check can be transferred to save for estimated tax payments.

No matter whether a business is large or small, keeping its finances properly maintained is essential to appropriate business operation.

Accounting For Your Business

What's in the bag? Business of Software 2010
What’s in the bag? Business of Software 2010 (Photo credit: betsyweber)

Running a small business can be one of the most time consuming and stressful experiences in life. It is important that you have book keeping services that are accurate and reliable in order to avoid financial problems in the future. However, there are thousands of business owners that deal with book keeping nightmares on an annual basis, this is something that you could protect yourself against. When you take advantage of the best free online accounting services, you would be able to keep all of your finances organized without having to worry about wasting money. This service will not subject you to an expensive monthly charge, you do not need to enter a credit card in order to sign up.

If you hope to become very successful with a small business, you will need to limit the amount of money that you are spending. However, many business owners spend a large amount of money on a regular basis in order to have all of their finances organized and taken care of. The solution to this would be a great free online accounting service that would provide you with a much better value. It is possible to save a large amount of time, effort and stress that you would be subjected to when dealing with financial problems. Instead of having to experience these problems, it would be wise to start using this program today for all of your financial needs. You would protect yourself against financial disasters while also saving money and with this great technology today.

Arizona Experiences Increase In Small Business Hiring

TurboTax 2012

The most recent Intuit Payroll Small Business Index for October revealed that, despite a downward trend nationwide, Arizona small businesses increased hiring for the second consecutive month.

The nationwide figure decreased by 0.05 percent, while Arizona saw a 0.13 percent increase. Overall, small businesses in the United States created 10,000 fewer jobs.

The decline in nationwide figures began in May. Small businesses added 150,000 from the beginning of March 2010 until the end of May 2012

The total recovery amounts to 85,000 jobs after a decrease of 65,000 jobs since May.

Roads and freeways in metropolitan Phoenix
Roads and freeways in metropolitan Phoenix (Photo credit: Wikipedia)

According to Inuit, the software company that makes TurboTax 2012, any enterprise with fewer than 20
employees qualifies as a small business.

The data analyzed came from approximately 170,000 customers using Intuit’s Online Payroll. In addition to making Turbotax, Intuit created Quicken software for bookkeeping.

In September, revenue recorded by small businesses decreased 0.3 percent. Of all the industries the Index monitors, none recorded an increase in revenue this month.

The biggest decline  was in the construction industry, which fell 0.8 percent, with accommodation and food services, professional services and retail all showing a 0.5 percent decrease.

Revenues across the nation have fallen 2.5 percent since this past February, which would be a 4.3 percent decrease for the year if the trend continues.

In October, employees saw their salaries decrease an average of $2,791, a decline from $2,794, or 0.1 percent, for September. The period covering August to September saw an increase of $17 in employee salaries.

Hourly employees worked an average of 24.7 hours each week with a total of 107.1 hours for October, down 42 minutes, or 0.7 percent from the 107.8 hours reported in September.

4 Ways to Save on Your Taxes

As we kick off the new financial year, small businesses and enterprises should already be thinking about how to plan their business in order to minimize their tax liability. For many business owners, taxes are a major source of stress and worry, so by starting to plan your tax strategy early in the year, you can ensure that your year end goes smoothly later on. Here are some of the best ways in which you can minimize your tax liability for this financial year.

1. Make employee reimbursements accountable

If you include reimbursements for things like travel, entertainment and sustenance in an accountable format, these will not be treated as additional compensation. This means you can reduce your employment tax liability and your employees will be happy too, because they will not have income included on their own tax forms for the reimbursements they receive. As well as the usual expenses, you can consider including things like employee uniforms, tools and other incidental items.

2. Keep all receipts relating to your car

If you run a car, van or truck for business purposes, you can use the fixed mileage allowance set by the tax authorities to calculate the available write off figure for your use of the car. However, the option to this is that you can offset things like fuel, repairs and maintenance of the vehicle but exclude the mileage calculation. By keeping all your receipts and invoices for money spent on the car, you will be able to make an assessment at the end of the tax year as to which route works best for you. Whichever way you decide to go, you will need well documented records of driving usage including odometer readings and dates, so keep a good record throughout the year to help with end of year calculations. In addition to this deduction, you can deduct payments for parking fees and any toll charges from your taxes, as long as you have kept all the receipts and proof of payment.

3. Employ your kids

If you have children who help out with the business, put them on the payroll. Kids over 16 have a tax free allowance equivalent to that of an adult, and the money you pay them is a tax deductible business expense. As well as benefiting your company financially you will also be able to get work done that needs doing, whilst teaching your children the value of hard work and responsibility.

4. Change your accounting and business type to suit your needs

There are a number of different ways in which companies can account for their businesses. Sole traders may be better off as limited companies, companies that manufacture goods may be able to change the way they account their inventory and small businesses need to consider whether their staff are better off as freelancers, PAYE employees or on short term self employed contracts. To get the inside track on what will work best for your business, it’s a good idea to enlist the support of an accounting professional who will already have a good understanding of tax rules and how businesses can benefit.

PHS Hadjizacharias can provide you with professional Tax services in Cyprus. Its an independent organization with global experience in Audit in International Tax planning