If you have had enough of the 9 to 5, you may have decided to set up in business on your own. You have a fairly good idea of what's involved and understand that you need to oversee everything in the early days, at least until you are established. Once you've got money coming in and are handling the expenses, you can bring in other people to help you, but there's one task that you really should consider outsourcing from day one, for a variety of different reasons. Why do you need to get help from a third party when it comes to your accounting?
The Australian Tax Office will no doubt be delighted to see that you have set up your own business and therefore developed a brand-new source of potential tax income. They will also want you to keep very clear and accurate documentation from the very beginning to support any of the returns that you send in to them. Tax can be one of the biggest draws on your revenue, and you need to be sure that you are getting everything right. Everyday calculations relating to income and outgoings are used to generate a variety of different reports, like the BAS and the GST, together with your periodic balance sheet and profit and loss.
When all your figures are accurate, you will be able to keep your tax liability to the legal minimum. You will also be able to avoid late penalties or other fines related to incorrect or tardy reporting. Remember, you cannot plead ignorance as a form of defence, as the ATO is particularly unyielding.
Ready for Audit?
When you get an accountant to help generate all your financial details and keep everything up-to-date, you won't need to panic if the ATO asks you for an audit. All of your business transactions will be in their proper place and easy to access, and the corresponding paperwork will help to back up all your claims.
Change Is a Given
The tax laws in Australia are very complex and a variety of different changes are introduced each year. Are you keeping up-to-date with these changes? Your accountant undoubtedly will and will advise you if you need to make any changes in order to take advantage of new laws.
Stress Takes Over
Nobody said that self-employment would be easy, and there will undoubtedly be an increased level of stress from time to time. When new business owners encounter this stress, they can often overlook some of the more "mundane" work until they get a handle on their particular problem. Unfortunately, this frequently means that bookkeeping will take a backseat, and before you know it, it's time to generate and send in some of your tax returns. How do you think you're going to be able to catch up now, and don't you think it would have been better to outsource all of this to an accountant or bookkeeper from day one?
The Bottom Line
Look at the cost associated with an accountant as an investment. Many small business owners find that these costs pale into insignificance compared to tax losses, fines or worse.