Choosing a date for your accounting year-end is entirely your decision as the business owner, but there are some important factors to consider.
Whichever date you choose will have an impact on when you pay the tax due on your profits.
If you are a Limited Company, your Year-End date will be the year after the end of the month when you registered your company.
This date will be assigned to you by Companies House. Your accounts must be filed at Companies House to their deadline.
As a Sole Trader, synchronising your Year-End date with HMRC’s tax year (5th April) would be the simplest, least confusing option. However, you are at liberty to choose whichever Year End date suits you best and is most convenient for how you operate your business. For example, if you are an independent retailer and you have stock, you would need to carry out a stock check at the Year-End, so it would make sense to do this when the stock level is lowest.
Making a decision about your Year-End date will have financial implications which may well change the direction of your business.
With our many years of experience, working with businesses across all sectors, we can help you make the best decision to suit you and your business.
We know you didn’t start your business to spend seemingly endless hours dealing with paperwork, but it has to be dealt with methodically. Some people call it ‘spiking’ where they put receipts on one spike, invoices on another and have one big spike for miscellaneous paperwork. Other people just keep everything in plastic bags, putting off the evil day when it all needs to be sorted out.
Whatever method you choose, being disorganised is just not an option. We have a professional team of accounting experts who can keep all of your financial records in apple-pie order, prepare your Year End accounts in accordance with HMRC regulations. We can provide a cost-effective solution, tailor-made to suit your business and help it to operate more efficiently.
By law, you must submit properly prepared and accurate Year End accounts. It has to be done, so why not alter your perspective and focus on all the advantages this process can bring to your business?
Keeping a close eye on your income and outgoings actually gives you a good sense of knowing exactly how your business stands, and if you know that, you have the chance to react in a timely manner to avoid problems and seize opportunities.
As well as helping to maintain a healthy cash flow, there are many more advantages to staying on top of your bookkeeping.
Maintaining properly managed financial records helps you feel in control. This will give you a positive mindset which will benefit your business and help you manage other areas of your life more effectively.
On the face of it, managing your own business sounds wonderful. You can work whatever hours you choose, take time out for lunch with friends and take holidays to suit your timetable. That would be how an ideal world would work. Unfortunately, stress arising from financial pressures, working irregular or too many hours, isolation and not being able to ‘switch off’ has a real impact on mental health and well-being, directly affecting your business. Breaking that vicious circle and having control in one critical area of your life can help avoid depression and anxiety.
Spot the rocks ahead
Regular evaluation of your business performance will reveal financial trends so you can adjust your business plans accordingly to deal with problems before they become critical.
Year on Year comparisons
This data provides beneficial insight into your profitability, and you can identify any monthly, annual or quarterly fluctuations.
You can see where your strengths are, and identify your weak areas, giving you the flexibility to alter your activities accordingly.
Knowledge is power. Knowing your exact financial position gives you confidence in your ability to take your business forward, and what key decisions need to be made to impact your profitability.
One of the first things a new supplier or customer does is to check out your trading history, credit rating and any evidence of non-compliance with HMRC may well put you in an unfavourable light and even lose you business.
We will keep a dialogue running with you throughout the year, and not just at Year-End, answering any queries you may have, and providing good common-sense commercial advice. Whatever your concerns, you can contact us at any time