Signs that you need an accountant for your business in Dubai
In the early stages of a company’s lifecycle, the key members within the organization, particularly the owner, may have to wear several different hats. On any given day, you might play the role of CEO, secretary, salesman, accountant, or even intern… depending on what the business requires.
While this juggling act may work initially, as the company scales, the trick becomes unsustainable. For instance, taxes and financial planning become exponentially nuanced and time-consuming, especially if you operate within an industry with stringent regulatory or compliance standards.
To that end, every growing business reaches the stage where having an accountant becomes a matter of necessity. But how do you know when it is the right time to hire an accountant? By paying attention to the signs.
1. You Don’t Know How to Track Your Finances
The main purpose of any business is to make more money than is spends keeping up with expenses. Whether you’re using Wave vs QuickBooks or visa versa, if you’re not tracking your finances, you have no way of interpreting how well your business is doing.
If it’s an obligation you always put off or you simply don’t have the time or know-how, you need an accountant to maintain your bookkeeping. They’ll track every dollar coming in, as well as every expense. It’s just as important to know where your money is going rather than just how much is being spent.
2. You’re Scaling Your Business
Having a booming business is never a bad thing. If you can’t keep up, it just means you need to hire on a little more help, especially if you’re deciding to expand.
You may need an accountant to help you understand your best possible growth strategy (new locations, new hires, better marketing, new products, etc.). They’ll be able to look at the numbers to determine what you can and can’t afford, as well as any risks involved.
3. It Seems Like Your Business is Spending Too Much Money
Business owners who are inexperienced with financial management may find themselves at a loss each month. Where did all their money go? Shouldn’t there be more left at the end of the month?
If you find yourself in this position, always seeming to have spent more money than you should have, you probably need an accountant to help you get your budget in order.
4.You Have Problems With Payroll Each Month
If your business has any employees (other than you), you need a reliable and consistent payroll system to make sure you’re taking care of your staff. However, payroll can be difficult to manage, especially for busy or inexperienced business owners. You may need an accountant to help you set up a payroll system and ensure everyone’s getting accurately compensated.
5. You Need Help With Forms
When you’re a business owner with employees, there are a number of forms you need to file with federal, state, or local tax agencies in addition to your business tax return. You must file tax forms (e.g., Form 941) showing how much you paid employees and withheld in taxes.
To help you with this responsibility, you could also sign up for full-service payroll software. Full-service payroll files federal, state, and local payroll taxes on your behalf.
Did you take out a Paycheck Protection Program loan? An accountant can help you navigate the intricacies of applying for loan forgiveness on Form 3508.
6. You Get Audited
An audit can be a nerve-racking ordeal for business owners. During an audit, the IRS analyzes and exposes your financial history to find discrepancies.
Accountants can review your records and make sure they are accurate. They can reconcile accounts, check for missing information, and run reports to help you avoid tripping IRS audit triggers and keep your books up-to-date, clear, and accurate.
7. Your Business Is Growing
Did your sales explode overnight? Steadily rise? Either way, an accountant can help as you grow. A bigger business means more profits—and more spending. But if you fly too close to the sun, you could be hurting your business’s future.
An accountant has the expertise to project how successful your investments will be so you can confidently spend your revenue—without overspending. They can caution you about harmful business purchases and suggest smart investments.
Accountants play a leading role in year-end tax planning for business owners and can help you prevent overspending or under-spending. Their reports could prevent you from making a regrettable investment.
And if you’re experiencing business growth, you might need to update your business plan. A business plan is an ever-changing document that should evolve as your business does. You might talk with an accountant about making key business plan updates.
8. You Don’t Understand Business Taxes
Taxes can be confusing, especially if you’re filing your first business tax return. Make a mistake, and you could wind up with IRS penalties. Not to mention, you could miss out on opportunities to lower your tax bill through tax deductions and credits.
Not sure where to start with your tax return? An accountant can help you make sense of it by:
- Letting you know which tax return form you need to file for your business structure
- Notifying you of filing deadlines
- Finding tax credits and deductions
- Helping you understand your accounting records
You may want to hire an accountant for taxes when you’re just starting your business (or at any stage in business ownership) to help ensure you fill out the forms correctly.
9. Turnover has increased but profits haven’t.
More money coming in must mean more profit right? Not necessarily! This is a good time to have an accountant review your books and identify areas where your expenses can be improved to make a significant difference to the bottom line.
This might seem simple, especially if you have invested in a software package such as Xero. This makes it feel as though managing GST is easy. However, there are a few pitfalls that new businesses can get trapped in when it comes to GST. If you are registered for GST then it is best to get some advice from an accountant.
11. Feeling overwhelmed
When you first started your business the invoices were pretty simple. You had a few customers and you collected the money and gave them a receipt. But as the business has grown you might be experience more complicated scenarios. When it starts to get tricky, it's time to call your accountant.
12. You have better things to do
Once business is going well you will be too busy working on more technical areas of your business. This is where you are going to get the most return is if you focus on the things that you are good at.
13. Thinking of selling or expanding the business.
When selling, expanding, taking on a partner, each scenario has a number of potential tax implications. It could cost you thousands of dollars if you don’t seek professional advice. A professional accountant can ensure that you have the correct structure to maximize your profits and minimize your liabilities when making big changes in your business.
14. Buying or selling property
Buying and selling property within a business structure can be tricky and there are many things that need to be considered. An accountant can walk you through all the scenarios to ensure that you choose the best outcome. You need to get this advice prior to making any purchases as once you have signed a contract it may be too late.
15. You’ve realized how little you know about accounting!
You might have done an accounting subject at high school or uni, but times have changed and tax laws change constantly. It is best to get advice from someone who knows the current laws and how to maximize the opportunities.
16. Unexpected circumstances
Sometimes, personal affairs can impact the future of your business. For instance, if a business partner were to leave or if the company is considered a marital asset in the case of a divorce, either could change a business’ course. An accountant can help advise proper actions about taxes, business structures, estimate the business value, or produce financial statements for the company’s sale.
17. Taking out a business loan
An accountant can help you determine if taking out a loan aligns with your business plans. If so, they can recommend the best loan structure, size, and payment structure while preparing the necessary financial statements.