Running a small business comes with many responsibilities, and managing finances is one of the most crucial aspects. While many entrepreneurs handle their own bookkeeping initially, there comes a time when hiring an accountant can save time, reduce stress, and improve financial health. Here’s how to determine when you should hire an accountant for your small business.
1. When Starting Your Business
Hiring an accountant early can help you set up your business correctly. They can assist with:
- Choosing the right business structure (sole trader, company, partnership, or trust)
- Registering for an Australian Business Number (ABN) and Goods and Services Tax (GST) if applicable
- Setting up an accounting system to track income and expenses effectively
Getting professional advice at the start ensures you avoid costly mistakes down the road.
2. When Your Business is Growing Rapidly
If your business is experiencing significant growth, managing finances can become overwhelming. An accountant can:
- Help with budgeting and financial planning
- Ensure you meet tax obligations as revenue increases
- Provide advice on cash flow management to keep your business financially stable
A growing business means more complex finances, and having an accountant can keep everything in order.
3. During Tax Time
Preparing and filing tax returns can be complicated, especially if you have multiple income streams or deductions. An accountant can:
- Ensure accurate and timely tax filing
- Identify tax deductions you may have missed
- Help with BAS and PAYG reporting if you employ staff
Having an accountant handle your taxes reduces errors and ensures compliance with the Australian Taxation Office (ATO).
4. When Applying for Loans or Seeking Investors
If you’re looking to secure financing or attract investors, you’ll need well-organized financial records and reports. An accountant can help by:
- Preparing financial statements
- Creating cash flow projections and budgets
- Advising on the best financing options for your business
Lenders and investors will have more confidence in a business with professional financial management.
5. When Managing Payroll and Employee Benefits
Once you start hiring employees, payroll processing becomes a critical task. An accountant can assist with:
- Calculating wages, PAYG withholding, and superannuation
- Ensuring compliance with employment tax laws
- Managing fringe benefits tax (FBT) and other payroll-related obligations
Proper payroll management ensures employees are paid accurately and on time while staying compliant with tax regulations.
6. When Facing an ATO Audit or Financial Issues
If you receive a tax audit notice from the ATO or face financial challenges, an accountant can provide invaluable support by:
- Representing you during audits and ensuring compliance with tax laws
- Helping you navigate financial difficulties and restructuring debts if necessary
- Offering expert advice on improving business profitability and financial stability
Having an accountant during an audit or financial crisis can significantly reduce stress and ensure the best possible outcome.
Conclusion
Hiring an accountant is an investment that can save time, money, and potential legal issues. Whether you’re starting a business, growing rapidly, or need help with taxes, an accountant provides expert financial guidance to keep your business on track. If you’re unsure whether you need one, consulting with an accountant for an initial review can help determine the best course of action for your business.