 Tax Affinity Accountants with their high street branches The Smart Move: Why You Should Use a Tax Accountant for Your Self-Assessment
In the world of personal finance, few things are as certain as taxes. Each year, individuals across the globe prepare to navigate the labyrinth of tax regulations, deductions, and forms required for their self-assessment. While some opt for the DIY approach, a growing number are discovering the numerous benefits of enlisting the expertise of a tax accountant. In this blog post, we'll explore why using a tax accountant for your self-assessment is not just a smart choice but often a financially savvy one. 1. Expertise and Knowledge: Tax accountants are professionals who specialize in tax laws and regulations. They stay up-to-date with the latest changes in tax codes and have the experience to navigate complex financial situations. This expertise can help you minimize your tax liability legally. 2. Maximize Deductions and Credits: Tax accountants have a keen eye for identifying deductions and credits that you might overlook. Their attention to detail can result in significant savings, ensuring you're not paying more taxes than necessary. 3. Reduce Stress and Save Time: Preparing your own taxes can be time-consuming and stressful. It often involves sifting through a mountain of paperwork and deciphering intricate tax jargon. Hiring a tax accountant frees up your time and reduces the stress associated with tax season. 4. Avoid Costly Mistakes: Filing taxes incorrectly can lead to penalties and audits. Tax accountants are trained to minimize errors and ensure that your return is accurate, reducing the risk of costly mistakes that can haunt you later. 5. Year-Round Assistance: A tax accountant's support isn't limited to just tax season. They can offer financial advice throughout the year, helping you make informed decisions to optimize your tax situation and financial health. 6. Audit Protection: If you're audited by tax authorities, having a tax accountant on your side can be invaluable. They can guide you through the audit process and ensure that your rights are protected. 7. Customized Strategies: Tax accountants can create personalized tax strategies that align with your financial goals. They consider your unique circumstances to help you make the most of available tax benefits. 8. Peace of Mind: Perhaps one of the most valuable aspects of hiring a tax accountant is the peace of mind it brings. Knowing that a professional is handling your taxes can alleviate anxiety and allow you to focus on other aspects of your life. 9. Cost Savings: Contrary to common belief, hiring a tax accountant can often result in cost savings. The deductions and credits they can uncover, combined with the reduction in errors, can more than offset their fees. 10. Legal and Ethical Compliance: Tax accountants operate within the bounds of the law and adhere to ethical standards. This ensures that your taxes are filed ethically and legally, eliminating any worries about potential legal repercussions. In conclusion, the decision to use a tax accountant like Tax Affinity for your self-assessment is an investment in your financial well-being. Their expertise, ability to maximize savings, and dedication to compliance can make the process smoother, more accurate, and less stressful. Ultimately, it's a smart move that can pay dividends in terms of both financial savings and peace of mind. So, this tax season, consider enlisting the help of a tax accountant like Tax Affinity and reap the rewards of a stress-free and financially optimized experience. By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are the number rated and recommended Tax Accountants in London. With branches in Worcester Park and Kingston upon Thames and Epsom and Ewell they are considered in the Industry to be expert business accountants and tax advisors for both individuals and small & medium sized businesses (SME's). Helping and supporting both individuals and limited company owners / self employed people throughout the UK and the world, they regularly help clients grow their business providing tailored advice and support. Their support has been considered invaluable by many clients and key to their success. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.
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 Tax Affinity has high street branches for customers support The new UK Chancellor (yes another one...can you believe the UK had 4 Chancellors in 4 months in 2022) has given his first budget. And as before we have refined the main points and facts for business owners including SME's and entrepreneurs. So you can easily navigate and plan ahead with clarity.
The main points from the budget are: 1. Energy price guarantee for homes will remain at £2,500 extended for only 3 months until end of June. It was set to rise to £3,000 but that has now been cancelled. And no new support announced for business bills. 2. Corporation Tax for a limited company will rise from 19% to 25% from 6th April 2023. Small company's with profit of less than £50k will still pay the lower 19%. But companies with profits between £50k to £250k have to pay between 19% and 25% but are allowed to claim marginal relief. Company profits over £250k will be taxed at 25%. And companies with group ownership of other companies may end paying close to 26.5% (effectively) because the corporation tax for Group Companies was increased also - sadly all important details missed by the main stream media. 3. Tax-free yearly allowance for pension cash out to rise from £40,000 to £60,000 after being the same for the past 9 years. 4. Fuel duty (tax) frozen so the 5p cut to fuel duty/tax on petrol and diesel which was due to end in April, has been extended for another year. 5. Maximum amount a worker can accumulate in pensions over their lifetime before paying extra tax currently £1.07 Million will be cancelled. Now there is no limit. 6. Tax on tobacco to increase by 2% above inflation for normal and 6% above inflation for hand-rolling tobacco. 7. Those who are already drawing down on their pensions, the total amount they can save tax free under the Money Purchase Annual Allowance is increased from £4,000 to £10,000 from April 2023. 8. 30 hours of free childcare for working parents in England expanded to cover 9 months to three year olds. 9. New £600 "incentive payment" for people becoming childminders, and the rules have been changed in England to let childminders look after more children. 10. Immigration rules to be relaxed for five roles in the construction sector, to ease labour shortages in the Industry. These categories are:
11. Super deduction of 130% will end on 31/03/23 and move back to 100% AIA for plant and machinery purchased and can be used directlty against corporation tax payable. A list of typical purchases is lasting until 31/03/26:
If your worried how these will effect you and need more specific guidance to help your business carry on growing during turbulent times then contact one of our Tax Affinity expert business advisors today (click here). With their countless years of knowledge and expertise they can guide your business to success even in the toughest of economic conditions. By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are experts Business, Tax and Accountancy. With branches in Worcester Park and Kingston upon Thames and Epsom and Ewell they are considered in the Industry to be expert business accountants and tax advisors for both individuals and small & medium sized businesses (SME's). Helping and supporting both individuals and limited company owners / self employed people throughout the UK and the world, they regularly help clients grow their business providing tailored advice and support. Their support has been considered invaluable by many clients and key to their success. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.  Tax Affinity have many high street branches The government's records for the past 12 months to March 2022 showed that consumer prices have risen as much as 13.4% in some sectors. This is much higher than the 9% reported a few weeks ago. It is therefore prudent to assume when bad news is highlighted by the government or a corporate entity it will most likely be understated.
Now that the ONS has issued more accurate figures its important medium to small sized businesses know the exact figures when it comes to costs to make sure they can budget correctly and choose to either absorb or pass on costs. So the business owner can safely steer the business through a recession or downturn. A quick list of UK inflation figures is below and it is advised that business owners plan and manage these as soon as possible:
Tax Affinity Accountants are rated as the number one business advisors for medium to small businesses. So if your a business owner who is effected by the inflation rises and need expert guidance and support then get in touch today and we will be happy to help you plan a strategy to steer your busines to growth and success. By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are experts Business, Tax and Accountancy. With branches in Worcester Park and Kingston upon Thames and Epsom and Ewell they are considered in the Industry to be expert business accountants and tax advisors for both individuals and small & medium sized businesses (SME's). Helping and supporting both individuals and limited company owners / self employed people throughout the UK and the world, they regularly help clients grow their business providing tailored advice and support. Their support has been considered invaluable by many clients and key to their success. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.  Tax Affinity Accountants have several branches in London The spread of (Covid-19) Coronavirus from Mainland China throughout the world is having massive effects upon small and medium sized businesses. A lot of small business owners are so busy with running their busy everyday that they have not had time to try to figure out a plan to safeguard their employees, customers and profit lines.
The British economy is reliant upon finance, tourism and to a lesser extent manufacturing. Data presented earlier this month showed British economic growth slowed to a stand still at the end of 2019. Supply chains from China have dropped off and many travel operators are slowing down or closing services. This means limited supply and increases in costs. And because small to medium sized (SME) businesses often do not have the cash flow and financial resources to absorb sudden increases in costs this can mean a serious problem, not to mention the health and well being of their staff. Unlike the press, we don’t just present the problem but provide an answer - So here is what SME business owners need do to manage the coronavirus problem:
By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. Based in Worcester Park and Kingston upon Thames and Epsom they are considered in the Industry to be expert business accountants and tax advisors for small and medium sized businesses (SME's). Helping and supporting limited company owners and self employed people throughout the UK, they regularly help clients grow their business providing tailored advice and support. Their support has been considered invaluable by many clients and key to their success. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.  With the UK now officially leaving the EU, small and medium sized business owners need to put plans and procedures in to place to ensure their business carries on with no problems. Research show that unfortunately the vast majority of SME business owners continue to bury their heads in the sand and ignore the potential ticking time bomb.
Below is a short check list of what you may need to do:
By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. Based in Worcester Park and Kingston upon Thames and Epsom they are considered in the Industry to be expert business accountants and tax advisors for small and medium sized businesses (SME's). Helping and supporting limited company owners and self employed people throughout the UK, they regularly help clients grow their business providing tailored advice and support. Their support has been considered invaluable by many clients and key to their success. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.  Tax Affinity is a reputable business adviser and can help give you the strategic advice need to grow Growth Vouchers Scheme can be invaluable for business to gain the advice and support needed to expand and grow their profits and business.
This government programme is basically designed to help small businesses get strategic business advice on:
The voucher can pay for up to half of the cost of the advice from a recognised business adviser such as Tax Affinity Accountants can serve as a real helping hand to boost your business. It is structured in such a way that the supplier will claim this fee from the programme making it easier for the business owner to quickly get the support and advice he/she needs. There are some simple eligibility criteria as below: Your business must:
And then you will need the following things to complete your application, as available by your accountant:
So how does it work? Either speak to your chosen adviser and they will make the necessary arrangements for you or sign up on the government’s growth voucher website (open until March 2015). Once you have received the voucher, simply use it for the advice and support. The growth voucher scheme has been running for few months now and it is growing in success. However, be careful because the scheme is not intended for company owners seeking to subsidise practical guidance on how to engage in precise tasks relating to running a business. It’s for tactical advice that will lead to growth of the businesses. The quickest way to get support for the is to call 0800 043 4051 or visit www.taxaffinity.com and speak to one of our experienced business adviser's and growth coaches at Tax Affinity Accountants. By Tahir Malik at Tax Affinity Accountants Tax Affinity Accountants are experts in business coaching and are based in Kingston upon Thames they are considered to be experts in their field. Helping and supporting businesses and individuals throughout the UK. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends. 
Wondering if you should you stay a sole trader or register your own limited company?
Sole Trader v Limited Company
A difficult question that the self-employed face is whether to trade as a sole trader/partnership or to trade as a limited company. However, the answer isn’t definitive and is dependent on many factors ranging from the type of business you are running to the type of person you are. Whichever one you choose has different implications for tax, legal and financial responsibilities. The aim of this article is to give you an insight to the advantages and disadvantages in terms of tax purposes of being a sole trader/in a partnership or forming your own limited company. Hopefully it will inform you on the structure most beneficial to you. Legality As a sole trader, you are the business. You have full control and ownership of the business and are able to manage it in any way you like. On the contrary, a limited company is its own legal entity. Instead you serve the company as a director of the company and act as a shareholder. In most cases, you are considered as an employee but this status is not automatically granted in terms of Employment Law, the National Minimum Wage or for Tax Credits. Tax – Sole Trader You are subject to income tax on the taxable profits of your business. For the tax year 2013/14, you pay 20% tax on income between £0 - £32,010 and 40% tax on income between £32,010 - £150,000. Income above £150,000 is taxed at 45%. The personal allowance amount for persons aged under 65 is £9,440. You are also required to pay Class 2 & 4 National Insurance contributions (NIC). Class 2 NIC are at a flat rate of £2.70 per week. However, you may not need to pay Class 2 NIC if your earnings are below £5,725 for the whole year. Visit http://www.hmrc.gov.uk/working/intro/class2.htm to see if you may be exempt from paying Class 2 NIC. Class 4 NIC is calculated based on your profits for the year. For 2013/14, you pay 9% on annual profits between £7,755 and £41,450 and then 2% on any amount over that. Any trading losses you incur on your business can be offset against other your income to reduce your tax liabilities. Tax – Limited Company For a limited company, it pays corporation tax on its taxable profits. Company tax rates are lower than the higher rates of income tax. If you are employed under your company and taking a salary, your earnings from that employment are subject to income tax and Class 1 NIC due through PAYE (Pay As You Earn). The amount you pay is dependent on your earnings. Shareholders of the company who are on a higher tax bracket may have to pay higher a higher tax rate on any dividend income they receive. Losses from the company can only be offset against its other income but not against your income as an individual. What does it all mean? Now for most people, the above two paragraphs may have been not only been of little help but confused you further. Here is a scenario that will make things easier to understand and hopefully give you enough information to aid you in that important decision. You have a trading income of £16,000 pre tax and wish to extract all the profits for yourself. As a sole trader, you will be taxed at 20% for any income in excess of your personal allowance. The total tax liability including the Class 2 & 4 NIC amounts approximately to £2,181 (assuming 48 weeks and available personal allowance of £9,440). The tax calculation for a limited company is slightly more complex as you have more flexibility in how you distribute the income. For simplicity sake, you take the minimum annual wage that is not liable for PAYE tax or NIC which is around £7,000. Company profits under £300,000 are taxed at a rate of 20%. Taxable profits is £9,000 and amounts to a corporation tax liability of £1,800. This leaves £7,200 to be distributed as dividend which is taxed at 10% for income below the earnings threshold of £32,010. The total tax paid equates to £2,520. In this scenario, it is marginally better to see that remaining as a sole trader is more beneficial as you pay much less tax. However, calculations may differ depending on the trading income and how much salary you take. The general idea is that as your trading income increases, its becomes more and more beneficial to trade as a limited company than as a sole trader (40% income tax versus 20% corporation tax). Just a Final Note You are better off trading as a sole trader for tax purposes if your annual trading profits are not high. However, many businesses opt to form limited companies for reasons that extend past tax issues. Should the business fail, you will not be personally liable for its debts if you were a limited company. If you plan to sell the business after a few year then limited is again a better choicAlso if you plan to expand the business then getting finance for your business may be easier if you were a limited company. There are many varying circumstances that makes being one more appealing than the other but if you still appear unsure then just contact us and we’ll be sure to offer you tailored expert advice to aid your decision. By Wilson Law at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. Based in Kingston upon Thames they are considered in the Finance Industry to be the small business experts. Helping and supporting business throughout the UK, they regularly help new and established businesses with valuable support. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.  So what are my options? The bridge between having a good business idea and implementing such idea into a business model can be wide and daunting. Getting the necessary funding to kick start your business can be a difficult process and different sources of finance may not be appropriate for everyone due to varying circumstances.
Whether you require investment for start-up capital or are looking to expand your business, the cost can be astronomically different depending on a few variables. Here is a list of things to consider when looking for a source of funding for your business: The “Right” Amount There are a few questions that should instantly appear on the forefront of your mind when you are seeking finance.
Doing your homework from the start will help you avoid many future problems. A shortfall in funding may jeopardise your business in its entirety, you may miss out on that explosive launch you was hoping for or realise that a particular project didn’t produce the desired results because you ran out of cash. There’s a subtle understanding in business that goes like this; “you need to spend money to make money”. Making big changes in your business requires money and not everyone has that money in their bank accounts. However, funding must not only be sufficient but efficient as well. There’s no point asking for more than you need, it will just result in more interest and a larger repayment towards the end. Plan out your budget by listing a breakdown of the different components the funding is used for. You may spot areas in which you can forgo and others that you may have missed out. And once you get the funding, you’ll know exactly what to do with it. Timing is Key Timing is essential in many aspects of life and its no different in regards to funding. Having a realistic time horizon to pay off your borrowings can make repayments easier and more manageable. Pacing your repayments can avoid interest payments from siphoning your cash flow. Tip: If your business is performing better than expected, think about repaying back the debt earlier to decrease the amount of interest accumulating. The Correct Choice Here comes the most difficult part when seeking for funds. How do I choose between so many options? Well unluckily for most, they don’t have as much choice as they think they do when it comes to the selection of finance. The most common for small businesses to get funding is through their own savings. This is, by far, the cheapest source of funding and the only opportunity cost associated is that you lose out on the interest on your savings which quite frankly is nothing compared to the potential interest payments you make for other sources of finance. However, a lot of the time, the money is not enough to fuel the business which leads to people opting for the next best choice; a bank loan. This may be the most appropriate option for many individuals seeking funding as terms can be flexible and mutually agreed upon by both parties. Tip: Try browsing through the different types of loans you can apply for, you may believe that there is some standard rate banks tend to charge for certain loans but be very surprised that the conditions of such loans can be as different as night and day. Take every percentage point at face value; there may not be much difference between 7% and 8% but over the long term you’ll end paying back significantly more in aggregate. Borrowing money through a loan or equity share from family and friends can be a good source of financial investment. Loans offered in this fashion tend to have a low interest rate compared to traditional loans and possess more lenient terms. Offering a piece of your business via equity distribution can motivate your family and friends to help grow your business. Be warned though that any business problems don’t end up trickling down to family matters. Also, make sure any loan agreement is in writing just to avoid any legal problems that may arise in the future. Another alternative of funding is through an outside investor. This is usually not a loan but an equity investment. This means that the investor becomes a shareholder in the business and is entitled to a percentage of the business profits (depending on his/her equity share percentage). Furthermore, the investor may have some degree of control in your business. Depending on the investor, this could be advantageous or disadvantageous. The outside investor could bring new ideas and contacts into the business which would help accelerate the growth of the business. On the contrast, the investor could be in disagreement with any business decisions made and hinder the progress of the business. It is up to the business owner to make sure the interests of both parties are aligned. One thing to note is that debts can be paid off but equity is fixed for the lifetime of the business which could result in equity being much more expensive if the business grows rapidly. At Tax Affinity Accountants we provide free tailored advice to help grow our clients business. By Wilson Law at Tax Affinity Accountants. Tax Affinity Accountants are experts in Tax and Accountancy. Based in Kingston upon Thames they are considered to be small business experts helping and supporting business in the UK. They regularly help new business start up and provide valuable support for new businesses. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends. 
Sometime it can be hard to see the wood for the trees without support
Keep your Business Cash Flow in check.
The success of your business is dependent on the way you manage the cash flow of the business. A business could be highly profitable but still default if it does not meet its short term debts. There may be times when it is unavoidable to experience cash flow reductions, such as spending your reserved cash on new capital or suffering from unexpected weather conditions that forces the business to close for a while. However, it is definitely unhealthy for the business to suffer cash flow problems on a regular basis and it may cause harm for the business in the long term. Good cash flow management and contingency planning will allow majority of these problems to vanish. Here are a few ideas on how you can improve your cash flow cycle. Operating at a Loss Many new businesses may operate at a loss in their first few years of trading. The costs of starting up a business normally exceed profits. However, if the business is over 3 years old and still making a loss, it may be of your best interest to carefully monitor your expenditure to ensure that money is not spent needlessly or on the wrong things. Having a Clear System A good system can ease out any fluctuations in your cash flow cycle. For example, a service provider can think about taking an upfront deposit of any project it undertakes or charging on a completion basis. Not only will it keep money available for short term use but allows more effective tax planning as profits is smoothed over periods. Keeping Up-to-Date It is good practice to review your credit control on a specific day every week. Keeping a routine check-up allows you to clearly identify what has been paid, what is pending and what is late. Paying your Bills by their Due Date You should always pay your bills on time. However, it is better to pay your bills as close to the due date as possible. It is advisable to pay around 3-4 days before the due date so that any issues arising in regards to the payment can be rectified in time. Giving Customer Incentives for Early Payment Offering discounts to new customers to encourage prompt payment can be beneficial for your company cash flow. Bear in mind that discounts should not be too deep otherwise it will eat into your profit margins. You can also offer discounts to recurring customers that make large payments in order to reduce the risk of cash flow problems arising from delayed payments. Penalties for the Late Often people do not react to rewards quite the way they react to punishments. Giving customers a penalty fine for any late payments will likely grab their attention and prioritise you on their payment list. Don’t be too harsh on late payments though as others may have temporary issues with their cash flows and imposing a penalty may end up hurting business relations. Saving for a Rainy Day Unexpected occurrences and accidents can happen out of the blue. Make sure you put aside some reserves for one of those “emergency” situations. Not all situations can be accounted for but having enough funds to deal with the likely ones can let you breathe a bit easier. Seeking Professional Help Many businesses struggle to keep their finances in check. The unfamiliarity of running a business and being unable to cope with numbers can be a grinding headache for business owners. An easy way to relieve the ongoing stress is by hiring an expert bookkeeper like Tax Affinity. They can advise you on managing your costs, list strategies to improve your revenue and also handle your tax affairs all. You can now focus on driving your business forward rather than being worried about the upcoming loan repayment. Take note on how the company finances are handled so that you are able to step in if needed. By Wilson Law at Tax Affinity. Tax Affinity Accountants are considered in the market to be experts in Tax and Accountancy in the UK. Based in Kingston upon Thames they have clients are right across the UK as well as Europe, Middle East and North America. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends. 
The big squeeze: Costs down = Profits up
Tips for Reducing Business Costs
If you own your own company, you will inevitably seek to bring in more business and increase revenues in order to boost your bottom line profit. However, equally crucial to final profit are your business costs. If you can cut down on unnecessary expenses and implement some simple cost-cutting strategies, you will make that all important difference and give yourself an edge over your competitors. Here are 10 basic ideas on potential cost-saving techniques: 1) Energy Costs- Investing in energy-saving office equipment has two key benefits. Firstly, you will pay less on future energy bills due to the more efficient nature of the appliances. And secondly, many energy efficient technologies are 100% tax deductible in the year of purchase according to the Enhanced Capital Allowance (ACA) scheme. You can write off the entire cost of energy saving appliances against profits, including: boilers; combined heat and power (CHP); lighting; pipe work insulation; and refrigeration. 2) Telephone and Internet Costs- Telephone and internet costs can be a significant overhead cost for some businesses. Landlines are expensive so make sure you don’t use them unnecessarily. Joint plans for internet and phone can help to save costs. Furthermore, consider automated phone attendants in order to save on staff costs, BUT make sure you don’t compromise your client service with long waits on hold. 3) Cash Flow- This is arguably the most important factor in the health of your business. In order to keep a healthy cash flow you should be wary of extending credit to your customers. You could perhaps offer small discounts for early payments and consider charging penalties for late payments (although this must be carefully outlined in contracts/invoices etc.). 4) Online Marketing- Rather than overspending on unnecessary advertising, make the most of the new trends towards online marketing through social media such as Facebook and Twitter. This is an extremely easy and inexpensive way to save money, whilst still increasing brand awareness. 5) Work From Home- Depending on the nature of your business it is certainly worth considering working from home. Aside from an obvious increase in flexibility, you will also be saving considerably on costs from commuting and maintaining an office. Furthermore, a proportion of your home expenses can be deducted from your taxable profits. Tax savings can be made on a range of household expenses, including: a proportion of utilities bills; repairs and maintenance directly related to your business space; mortgage interest; council tax; and rent. 6) Bulk Buying- As a business owner you are entitled to an account with wholesalers such as Costco or Booker, amongst others. You should certainly take advantage of bulk buying discounts. However, in order to maximise cost savings, you must consider whether buying in bulk is cost effective in each case for your business. For example, just because the cost per unit of pens, for example, is lower than an individual pen, this doesn’t necessarily mean you should purchase 1000 pens. Small businesses should only buy what they need in order to save costs and avoid waste. 7) Group Buying- Joining buying groups of multiple small businesses can greatly expand the buying power of smaller companies. The Forum of Private Business recently teamed up with Buying Support Agency (BSA) to offer group buying discounts in order to vastly reduce costs on routine items for small businesses. Equally, SME Discounts is a group-buying site offering substantial (up to 90%) discounts on business products such as marketing, operations, IT and B2B products and services. 8) Buy Second-hand- Office equipment can easily be bought second-hand as other businesses and organisations look to sell. Assuming you are careful, there are some great deals to be had for equipment that is as good as new and this can really help to reduce the costs of setting up an office. 9) Inventory- Try not to hold an excessive amount of inventory if you are unlikely to shift it in the short term. Inventory that is being sold is essentially just company money sitting on the shelf and this greatly impacts on your bottom line. Be nimble with your stock levels to react to consumer demand but don’t overstock your business as this cash could be spent more effectively elsewhere. 10) Staff Costs- Employee wages are often the most significant cost to a small business. Employees are in most cases crucial to the success of your business so you don’t want to alienate them by cutting wages. However, you may consider reducing hours slightly in unproductive areas of the business. In addition, look for interns or inexperienced hires that can perform certain tasks for a lower fee, or nothing at all. Finally, consider outsourcing certain areas of your business in order to save on time and cost. Payroll, for example, is an area that doesn’t add much value to your business and can be time consuming, so it may be wise to subcontract such an activity. By Tom Hoadley at Tax Affinity. Tax Affinity Accountants are experts in Tax and Accountancy in the UK. Based in Kingston upon Thames they have clients right across the UK as well as Europe, Middle East and North America. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends. |
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