Looking to start a business? What you'll need to consider

Starting your own business can be both an exciting and challenging experience but one which also carries its fair degree of risk. During the start-up phase you will have to make all kinds of decisions that could be vital to the long-term success of the enterprise.

You’ll need to consider:

• The type of business and its attributes
• Your target market and competition
• Profit potential and how you will extract those profits
• The rate of business growth
• The impact of running the business on your personal life

"‹At some point, you will also need to consider how you will exit the business when the time comes and realise its value. At TaxAssist Accountants, we specialise in helping small businesses and can provide expert, tailored advice and help you avoid the common mistakes.

Writing your business plan

One of the first things to consider is writing your business plan. This is not only for the benefit of potential investors, but to help you remain on the right track in the short, medium and long-term.

Your business plan should include at a minimum:

• The business structure that best meets your needs (sole trader, partnership, or limited company
• Your intended funding sources
• Tax-efficient borrowings

What business structure is best for you

Choosing the most appropriate structure for your business isn’t necessarily straightforward. Sole traders, partnerships, companies and limited liability partnerships all have their own pros and cons, with different implications for control, perception, support and costs.

For example, careful consideration is needed regarding whether to retain personal ownership of any freehold property on incorporation.

Deciding on your year end

It’s also important to select a year end that suits your business. Is there a time of year when it will be more convenient to close off your accounting records, ready for us? What time of year would be best for stock-taking? Is your trading seasonal?

From a tax perspective, picking a year end early in the tax year for an unincorporated business usually means that an increase in profits is more slowly reflected. Over time the delay between earning profits and paying the tax can create a source of working capital for the business. On the other hand, a decrease in profits will more slowly result in a lower tax bill.

How we can help

We can help you to decide on the best structure for your business and which year end might be appropriate.

We can guide you through the important decisions and help you to complete the appropriate registrations. We can assist with cashflow forecasts, helping you to spot potential cash shortfalls, and provide regular updates so you can monitor your business’s performance.

To arrange a free initial consultation with your nearest TaxAssist Accountant, call us today or drop us a line using our online enquiry form.

BUSINESS START-UP CHECKLIST	√
Prepare a robust business plan
Make sure you have access to suitable funding
Check your right to use your chosen trading name
Choose the right business structure
Understand your responsibilities to register for GST
Understand your responsibilities to register as an employer
Register your business name
Trade and professional registrations
Choose your year end

 

Date published 24 Jul 2018

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.