As we rapidly approach a new year, My Small Business Pro has assembled some of our best advice to make sure you are ready for the days ahead. Our clients are spending time evaluating their needs right now – staffing, training, cost-cutting, business planning. Here are some ways you can begin the process too!
Set Financial Goals. What are your revenue goals for next year? How much profit will you make? Do you have the tools/resources/staff to meet the goals?
Tax Prep. Contact your CPA and find out what they need to get your taxes done on time.
Compensation. Total the amounts you have paid your contractors (anyone who will be receiving a 1099 for non-employee compensation). Collect W-9s so that you can be prepared to issue 1099s by the January 31st deadline.
Records. Begin compiling records of your business income and expenditures so they can be totaled and categorized easily. If you have accounting software, this will be easy for you to do. If you do not, remember that you will be charged by your accountant to go through all of your records. When you give your accountant a shoe box of receipts, they hate you. Your accountant is not your secretary, and should not be sifting through receipts from your lunch outings, your coffee breaks, your office supply runs. At the very least, put things into a spreadsheet. Make sure that you are totaling complete expenditures with tips included.
How much did you spend? Are there recurring charges that you should not be paying for? What can or should be cancelled?
How much did you make? Did you rake it in this year? It’s a great problem to have, and paying for things in advance can lower your tax liability. See what can be pre-paid for next month, or even next year. Charitable contributions are not business expenses ever, but sponsorships are marketing expenditures. Are there any you can add?
Switch Payroll Providers. If you are planning to make a change, now is the time to do it. Starting that process prior to the first payroll of the new year reduces extra work and extra expense. Payroll companies have a bottleneck if you wait until January.
With Your Finance Professional (Hopefully My Small Business Pro!)
Refine Your Goals. Build your goals with actionable financial information. If you do not have detailed records, you are blind to what you should do in your business. Be equipped to make the right decisions for your company and develop your goals.
Review Your Financials. You should have received financial reports all year and know your profit allocation. You also should know your tax liability. Your finance professional provides reports to your CPA to deliver this important information.
Analyze Your Position. To jump start the new year exponentially, we go over some key questions with you:
- “what should you be spending money on?”
- “what are you paying for that you are not using?”
We may be able to free up some unproductive expenses and funnel that money toward reinvestment in your business.
Expand Your Software Tools. 1099s will need to go out by January 31st. The most effective way to get those out is to use an integrated software. We help our clients send them seamlessly. You may also want to consider transitioning to T-Sheets, a time tracking software that integrates with QuickBooks. We can assist!
Determine Employment Structure. Is it time for you to convert contractors to employees? There are nuances, such as payroll taxes, to consider when making this decision that impact your financials.
Evaulate your payroll strategy. If you are considering a change in provider, make sure you get some input. A good finance professional is able to identify a solution and help with integration and implementation. Smaller firms can use Quickbooks Online Payroll. Other solutions can and should directly integrate with your accounting software. The easy part is making the entry – you should also understand how payroll liabilities work and how they impact financial statements.
It’s a great time of year to move forward. There are many things you can do – on your own and with your finance professional – to prepare for the coming year and your financial future.
As always, My Small Business Pro is here to help answer all of your questions.