Small business accountants can help out at various stages during the growth of your business. They can handle much more than just your payroll and tax returns. So when should you consider hiring an accountant for your small business and how much will it cost?
Accounting and bookkeeping are often the first places business owners fall behind, but this is the last area where you want to drop the ball. Managing your finances is the key to a successful business, especially during tough economic times. Most successful business owners who work closely with an accountant will tell you a small business accountant is an absolute must. In fact, results from a study conducted by Intuit, the maker of QuickBooks, TurboTax, and other financial software packages, show that 89% of small businesses say they see more success with an accountant or an advisor.
The COVID-19 outbreak is no time to slack on your finances, and hiring a small business accountant may even help you weather the storm.
Challenges for Growing Small Businesses
There are good reasons for hiring an accountant at different stages of your company’s growth. From a business plan to company formation, loan application to a tax audit, an accountant can make life easier for you at each step.
Like all small business owners who are looking to save money, you may think you can’t afford an accountant. But look at how long it would take you to do certain tasks (such as taxes), and ask yourself, is that a good use of your time? Especially during the pandemic, it is essential your focus on other core areas of your business such as retaining loyal customers and new and creative marketing given the uncertain times.
For example, let’s say it takes you 13 hours to do your taxes, and your time is worth $100 an hour. That’s a cost of $1300 to do your taxes yourself. And there’s always the risk you’ve made errors – especially if you’re multi-tasking like most business owners. Additionally, there is much more to accounting than just doing your taxes, so it is likely the time spent will be well over 13 hours.
However, if you get an accountant to take care of time-consuming tasks like taxes, it’s quite likely they will cost less per hour than you would pay yourself. With cloud technology, there are multiple affordable outsourced accounting services, such as Limitless Investment and Capital that are ready to serve your unique business needs during the pandemic. You’ll not only have extra time to free you up to generate revenue, but you’ll have peace of mind that an expert is taking care of the details.
So what other moments during the life of a typical small business, might you want to hire an accountant to help you?
When to Hire an Accountant
Most accountants will tell you they could have saved their small business clients a lot of time, money, and headaches. That is if those clients hadn’t waited so long to ask for help. Bottom line is that there are several key times in the course of your small business you don’t want to wing it without having a small business accounting expert
1. Forming Your Business: The formation of your business is one of those key times. An accountant can help you write your business plan, advise you on your business’s entity structure, help you get all the appropriate licenses, and help you set up your bookkeeping software. If you involve an accountant while you’re writing your business plan, they will be able to use accounting software to add financial projections and other reports to it. This will help you create a business plan that’s realistic, professional and more likely to succeed.
2. Compliance and Tax Issues: Even if your business plan is written, you have all the required permits and licenses, and your bookkeeping software is new and shiny and ready to go… you’re not quite ready to go forward without an accountant. There are still dozens of compliance stumbling blocks to overcome. Don’t try to wing it without an accountant if you have:
- Complex sales tax issues
- Complex payroll issues
- Other reporting requirements
Hiring a professional at this early stage will mean you get the benefit of their financial knowledge and advice right from the start. That could save you time and money compared with hiring one later.
3. Small Business Accountant to Help with Finances: Small business accounting can quickly become complex if you do it on your own. If you feel you’re losing control of who owes you money and how much, an accountant can help you get back on track.
When the economy is turbulent, it is essential to measure key business metrics, such as the ratio of salaries and other employee payments to total revenue. An accountant can help here by managing your payroll and producing graphs so you can see how the ratio changes over time. If your small business accountant uses cloud-based accounting software, they’ll be able to share your business accounts with you quickly and easily. And they can produce tables and charts that will help you understand your company’s current financial situation at a glance. This will help you monitor the pulse of your business and keep track of important things like cash flow.
Additionally, it is likely your business will have to cut back on expenses during a recession, increase profit margins, and have excellent cash flow management techniques. An outsourced accountant can ensure your business is thriving rather than just surviving during difficult times.
4. When Applying For A Loan: Many small businesses around the United States are turning to loans during the COVID-19 crisis. Believe it or not, having an accountant can help improve your chances of getting a loan. Lenders want to see that you are fiscally responsible and some lenders require that you’ve been using an accounting solution for a certain amount of time in order to be eligible for the loan. Small business accountants can also offer insight into how the loan will affect your business finances. Additionally, loan applications are often very time consuming and require a great amount of detail, your accountant can save you time and increase your chances of receiving one.
5. When Buying Or Selling A Business: If you are considering buying a business/franchise or expanding your current business, talk to an accountant first. They’ll be able to assess if the purchase is a wise financial move. Additionally, if you need to sell your business, an accountant will walk you through the process.
How Much Does a Small Business Accountant Cost?
There is no set answer for how much an accountant costs. The price is going to vary significantly depending on:
- Your business
- The complexity of your accounting
- The services you require
- Whether you hire a bookkeeper, accountant, or CPA
- The accountant’s experience
Most small business accountants charge by the hour and will give you an estimate of how much the services you require will cost. The best way to figure out how much an accountant will cost is by deciding what you need your accountant to do and then searching for the right fit
Hiring A Small Business Accountant Is a Smart Choice
Just because you can do your own bookkeeping, doesn’t mean you should. If financial tasks are eating up your time and taking away from the success of your business, hire a small business accountant in Detroit and Denver. This will free up your time so you can get back to growing and running a successful business.
Limitless Investment and Capital Small Business Accountants during the COVID-19 Crisis:
Don’t Panic: Prepare. Your specialty is running your business. Leave the financial detail to an accountant. Limitless Investment and Capital’s small business remote accountants can help give your business the tools it needs to survive the COVID19 crisis. We are offering unique coronavirus relief packages that include accounting services, remote payroll processing, and legal advice for small businesses facing repercussions of the tough economic times.