In this blog post I share the 3 things you need to know before working with a Virtual Accountant.

As an entrepreneur and small business owner, I had to make various adjustments. Things like mindset changes are needed when you need to hire help to grow your business.

Most often it is a scary road to travel on. Many entrepreneurs refrain from hiring or outsourcing support to help them in their day-to-day tasks of managing their businesses.

This results in staying stuck in a certain mindset. Procrastination doesn’t help reaching goals, and even causes us to move backwards rather than progressing forward.

If you are here, reading this article, you most probably are in the head space of deciding to hire some support to help you move forward.

I would like to help you get more clarity on what you need to know before working with a Virtual Accountant. As an entrepreneur or business owner, you need to know how it is to work with a virtual accountant. Hopefully, this blog post help you to fully prepare for such a journey so you can feel in control and not overwhelmed.

Before you think hiring a virtual accountant is going to magically change your life overnight, consider these 3 things:

#1 : Before working with a Virtual Accountant, there will be a big up-front TIME investment

While the focus of a virtual accountant is meant to

• help offload compliance tasks,
• implement systems to enhance processes, and
• help you manage your finances more effectively,

they’re still human and not machines.

For it to be a successful relationship, there will be some serious training required. To help the virtual accountant understand your business, your challenges, your requirements, and your specific needs.

Your life might get a little more difficult before it gets easier as a result of hiring a virtual accountant.

It might also be a slow process before you might see the benefit. It all depends on your current situation and where you want to be, and how quickly you want to get there.

#2 : You need systems to make working with a Virtual Accountant a success

Virtual means CLOUD-BASED Technology.

This is a more efficient way to service clients everywhere from anywhere. When you decide to hire a virtual accountant, your systems and processes need to accommodate the functions and basic requirements for the accountant to be as effective as promised.

Predetermined systems can be build together, therefore it takes teamwork to be as effective as possible.

As every industry is different, so is every business unique. The way certain processes, tasks, and workflows come together. The systems needed will completely depend on the solutions and results you require.

Implementing basic solutions should be cost-effective and easy to use, but in some cases, your business might need a customized solution that might end up costing more than your budget allows. This might feel as if you’re spending more than you receive at first.

Be prepared to financially invest in your business so you can receive a return on your investments.

#3 : Virtual Accountants are more important to your business than you think

Before working with a Virtual Accountant as an entrepreneur or business owner, you might have a preconceived notion that hiring an accountant will be a quick and easy process. After all, they will be handling mostly business finances, right?

But the reality is, accountants have far more significant responsibilities. They can offer so much more value to your business. Your time is your most precious resource as a leader of your business. If an accountant is worthy, they will help you save more time, resources, and money!

Taking the time to find and hire the perfect virtual accountant could be just as important as recruiting a senior management member or partner in your business.

Remember, if your accountant is doing a great job, you are going to rely on them quite a bit!

At the end of the day, your Virtual Accountant’s responsibility is to ensure your business is managed as efficiently as possible, your finances are healthy, and your systems bring a return on investment.

Saving your time, money, and resources, helping you to get where you want to be as quickly as possible, and thriving with peace of mind is a significant but scarce attribute.

Yvette pretorius, ca & business building strategist

Focus on this when deciding who to hire!

If you need further advice on the process of working with a Virtual Accountant or you just need a helping hand to show you how to make the next decision, do reach out to me for ways on how I can help you move your business forward.

You are also INVITED to join my FREE Facebook Group, PROFITABLE ONLINE CREATIVES, for a community of Entrepreneurs and Business Owners to help, support, and empower each other!

See you Online!

In this blog post, we look at how starting your own business, requires you to know your Taxes!

There are many daunting tasks for entrepreneurs and business owners when starting a new business.

Managing a business can become overwhelming, but not more daunting than navigating one’s way through the world of TAX.

“In this world, nothing can be said to be certain, except death and taxes”

bENJAMIN FRANKLIN

Tax is something that everyone has to pay and is levied on income and profit received by a taxpayer.

Taxes are the government’s main source of income. Individuals and companies that do not comply with tax regulations are penalized.

Entrepreneurs who want to start a business need to be aware of their tax obligations. Running a business requires tax savvy knowledge. It does not matter whether it is in the form of a legal entity or in a personal capacity.

STARTING A BUSINESS, KNOW YOUR TAXES

Once you have decided to start a business, you must also decide what type of business entity you will use.

There are legal, tax, and other considerations that can influence your decision. Your business model will determine the tax obligations to adhere to.

There are several different types of business entities in South Africa. Also in every other country in the world and this complicates corporate taxes globally.

Each of these entity types has different tax responsibilities.

It is also important to note the various options to reduce administrative requirements. This is to ensure tax compliance is easier. Different tax incentives and rates may also apply in certain instances.

In South Africa, you have to choose the business model you would like to establish. Then decide if it is a legal entity, before you can understand its tax obligations.

Once you decided to register a legal entity, the FIRST STEP is to register your business entity with the Companies and Intellectual Property Commission (CIPC).

Legal entities required to register at CIPC:

• Listed public companies
• Unlisted public companies
• Private Limited companies
• Close corporations (Note that from 1 May 2011, no new close corporations are registered)
• Co‐operatives
• Non-profit companies
• State-owned companies
• Collective investment schemes

The SECOND STEP is to register this legal entity as a Taxpayer for Corporate Income Tax purposes.

When registered with CIPC, SARS automatically generates an Income Tax reference number.

In the case of starting a Business that is NOT a legal entity, operate as follows

• A sole proprietorship (taxed on profits in an individual capacity)
• A Partnership (note: each partner is taxed on their share of taxable profits, a partnership is not registered separately for income tax purposes)

Starting a Business registered as a

• Close Corporation,
• Co-Operative, or a
• Private Limited Company,

you may qualify for certain tax incentives and rates in terms of the Small Business Corporation incentives.

Alternatively, if your business operates as a natural persona or a micro company and you meet specific criteria requirements, you may also qualify for the Turnover Tax System (Micro Entity)

After receiving a Tax Registration Reference number, taxpayers must then register on eFiling to transact electronically.

Turnover tax is a simplified tax system for Micro Small Businesses with a qualifying turnover of less than

R1 million per annum.

It is a tax based on the taxable turnover of a business and is available to

1. Sole Proprietors (individuals),
2. Partnerships,
3. Close Corporations,
4. Companies, and
5. Co-operatives

Turnover tax takes the place of the following Tax Type Profiles:

• VAT (in the instance that you have not decided to elect back into the VAT system),
• Provisional Tax,
• Income Tax,
• Capital Gains Tax,
• Secondary Tax on Companies (STC), and
• Dividends Tax

Qualifying businesses pay a single tax [max 3%] instead of various other taxes

SARS

It’s elective – so you choose whether to participate. For Tax Tables visit here.

In the future, as a Small, Micro, or Medium Enterprise (SMME), providing your Tax Clearance information to another entity is required.

This could be to apply for a tender, new contract, good standing, or in respect of Foreign Investments.

To obtain your Tax Clearance Certificate from eFiling, you can request the help of an expert professional such as a Tax Practitioner or you can view the steps here on how to do it yourself.

Corporate Income Tax [ITR]

What is Corporate Income Tax?

Corporate Income Tax (CIT) also known as Business Income Tax, imposing on businesses incorporated under the laws of the Republic of South Africa. These entities derive income locally or globally but operates within the borders of South Africa.

Who is it for?

CIT is applicable (but not limited) to the following businesses and liable under the Income Tax Act, 1962 for the payment of tax on all income received by or accrued to them within a financial year:

• Listed public companies
• Unlisted public companies
• Private Companies
• Close Corporations
• Co-operatives
• Collective Investment Schemes
• Small Business Corporations (s12E)
• Body Corporates
• Share Block Companies
• Dormant Companies
• Public Benefit Companies.

Every registered taxpayer should submit an Income Tax return. This is to declare the income received over a twelve-month period at the end of the financial year, in the prescribed form.

Tax on Assessment

Payment of Tax upon an assessment notice issued by SARS is payable within the period specified in the notice.

Corporate Income Tax is payable at a rate of 28%

sars

Provisional tax [IRP]

As soon as business commences, you become a Provisional Taxpayer. Your business then registers with a local SARS office as a provisional taxpayer. This registration happens within 30 days after the date upon which you become a provisional taxpayer.

Companies are automatically registering as provisional taxpayers.

In addition to annual returns, every business submits a provisional tax returns.

The payment of provisional tax intended to assist taxpayers in meeting their normal tax liabilities.

• This occurs by the payment of two installments in respect of
• The estimated taxable income receiving or accrued during the relevant tax year and an optional third payment after the end of the tax year
• The first provisional tax payment is due within six months after commencing of the tax year.
• The second payment not later than the last day of the tax year.
• The optional third payment is voluntary and due within six months after the end of the tax year if your accounts close on a date other than the last day of February.

NOTE: For a tax year ending on the last day of February, the optional third payment is due within seven months after the end of the tax year.

Value Added Tax [VAT]

a) Compulsory registration

Any person who owns or manages a Business and whose total value of taxable supplies (taxable turnover) exceeds, or is likely to exceed, the compulsory VAT registration threshold must register for VAT.

The threshold is currently R1 million in any consecutive 12-month period.

b) Voluntary registration

A person can register as a vendor if that person runs a Business in which the total value of taxable supplies (taxable turnover) exceeds R50 000 (but does not exceed R1 million) in the preceding 12-month period.

A small business that is registered as a micro-business under the Sixth Schedule of the Income Tax Act may also register for VAT and may elect to submit returns and payments every four months, ending on the last day of June, October, and February

Top Tip: VAT liability date backdating requests submitted at the SARS branch will only be considered for new and existing registration if the vendor can provide sufficient supporting documents proving the backdated liability.

sars

NOTE: For requesting VAT liability date backdating, expect to provide invoices, signed contracts, or financial statements to motivate the backdating.

Employee’s Tax [Pay-As-You-Earn (PAYE)]

Registering as an Employer

According to law, an employer must register with the South African Revenue Service (SARS) within 21 business days after becoming an employer, unless none of the employees are liable for paying normal tax.

There you have it, all the important taxes for running your business efficiently and keeping it compliant.

If you need the help of a Tax Practitioner to register your business for any of these tax types at SARS, you are welcome to reach out to me for a free discovery session to determine the right compliance route for your business.

Because I am a heart-centered entrepreneur, passionate about helping other entrepreneurs build profitable online businesses, I created a 6-Step Roadmap to more clients, cash and confidence.

You can grab this free training here.

See you online!

In this blog post, I share the Bookkeeping vs Accounting – actual advantages and how to recognize them for any type of business. I also compare bookkeeping with accounting to help entrepreneurs understand the benefits of both for business success.

Being a small business owner, paying close attention to your finances is VITAL for the survival and growth of your business.

You can perhaps manage much of your Bookkeeping on your own with some time and resources, but when you look at your numbers and feel lost, it might be time to call in an expert.

Understanding when to use a financial professional can save you not only valuable time and money but also guard you against pitfalls from Government regulations. Understanding exactly what type of professional you need is equally important.

Usually, it comes down to satisfying one or more of these needs: Bookkeeping vs Accounting – actual advantages for your Business.

Bookkeeping and Accounting are connected, but the difference between hiring a bookkeeper and hiring an accountant is remarkably significant.

BOOKKEEPING vs ACCOUNTING – Recognize the actual advantages

The first key point is understanding the difference between the type of service offering:

Bookkeeping vs Accounting

and then understanding how each of these services is provided by the type of professional:

Bookkeeper vs Accountant

and realizing how they can help you optimize your opportunity for growth.

Bookkeeping and Accounting defined

Bookkeeping is the record-keeping process of tracking your Income, Expenses, and Assets.

Accounting is the compiling process of all account information through reporting and then analyzing this information to enable better business decision making.

Actual Advantages of a Bookkeeper for your business

Bookkeepers usually:

• Record purchases for stock, assets, and keep track of day to day operations
• Invoice customers, receive their payments, and issue statements
• Process supplier bills and payments and reconcile their statements
• Balance the general ledger accounts and reconciling the Bank Statements of all Business Accounts
• Process payroll and all journals into the General Ledger
• Reports to the Accountant monthly

Actual Advantages of an Accountant for your business

Accountants usually:

• Generate Company Reports such as the Trial Balance, Profit & Loss Statement, and Statement of Financial Position
• Prepare the Management Reporting
• Draft the Annual Financial Statements
• Analyze the cost of all operations and do a Ratio Analysis calculating the Gross Profit Margins
• Prepare the Tax Computation and calculated estimated taxable profits
• Advise Small Business owners on how to save on taxes and increase their GP %

How Business Bookkeeping data is used

• Bookkeepers record your Small Business’s daily transactions and generate data.
• Bookkeepers record transactions using a uniform method. Bookkeepers record data, in the same way, every time.

How Business Accounting data is used

• Accountants verify recorded data about your financial activities.
• Accountants make sense of your data and turn it into reporting and financial statements.
• Accountants look at the big picture view of your Small Business’s finances.

Nature of the Bookkeeping job

• Bookkeeping is transactional.
• Bookkeepers enter information from each transaction and compute figures.
• This means bookkeeping is cyclical.

Nature of the Accounting job

• Accounting is subjective.
• Accountants examine your financial information from a subjective point of view, using their expert knowledge to interpret data.
• Accountants look for patterns in your records to help you make business decisions impacting the future of your Small Business.

Recognize when you need the help of a financial professional

Bookkeepers are needed when you could use help keeping your books processed and balanced.

For example, your business may be growing too fast for you to do your own bookkeeping. If you have room in your budget, you might consider hiring a bookkeeper so you can focus on profit-making responsibilities.

Choosing to hire a bookkeeper as an employee or as an Independent Contractor will be determined by the type of Business you manage, your day-to-day requirements, and how you would like to invest in resources.

Accountants are needed when you must make sense of your financial information.

You need someone who understands profitability, cash flow, and financial planning. An accountant can advise you on the most financially savvy moves you can make based on your history. An accountant will also help you with year-end business tax planning and filing.

Because you only need an Accountant periodically, it makes better sense to outsource this expert service to an Independent Consultant on terms that will assist your Business to benefit from it.

BOOKKEEPING vs ACCOUNTING – Actual Advantages for your business

While bookkeeping and accounting differ, they have overlapping functions.

Both play an important role in informing you about your business’s health and projecting future outcomes.

Bookkeeping is the foundation of your finances while Accounting takes care of higher-level processing.

For example, let’s say you offer a coupon to your customers.

• You use Bookkeeping to record how many coupons are used.
• You use Accounting to look at how the coupons affect your finances and the health of your business.

As a small business owner, you can record your books with a do-it-yourself approach.

If you decide to use a financial professional – a qualified Bookkeeper – make sure you hire someone with credentials that match your needs. The more complex your financial situation is, the more likely you will need a registered Accountant.

Prepare to meet with your financial professional

You can help your financial professional get you accurate, meaningful answers about your finances.

When it comes to your business Bookkeeping and Accounting, knowing the difference and recognizing the advantages can help you prepare for working with the right financial expert.

When you hand records over to an accountant, make sure your General Ledgers are organized and correctly balanced. Usually, this forms part of the Bookkeepers’ tasks.

While your accountant examines your books, keep the communication lines open. If you don’t understand the financial jargon that your accountant uses, speak up, and ask questions.

Preparing to meet with your financial professional cuts down on time, which saves you money and a lot of headaches later.

Do you need a simple method for tracking your small business finances?

Try our online small business accounting software for accurate, up-to-date records.

Get a free trial today.

If you need further advice on understanding the differences between a Bookkeeper and an Accountant, or you need to take the next step to find the right kind of professional expert, reach out to me for ways I can assist you and your Small Business.

You are also invited to join my virtual community in my FREE Facebook Group, Profitable Online Creatives, for a community of Entrepreneurs and Small Business Owners to help, support, and empower each other!

Because I am a heart-centered entrepreneur, passionate about helping other entrepreneurs build profitable online businesses, I created a 6-Step Roadmap to starting a profitable online business.

You can grab this free training here.

See you online!

Entrepreneurs and business owners need to understand the functions of a Tax Consultant and a Registered Tax Practitioner. As an entrepreneur, running your own business and keeping your business tax compliant is a daunting task.

Basic functions of a Tax Consultant (or registered Tax Practitioner) for South African Entrepreneurs:

• A Tax Consultant specializes in understanding how to interpret various taxation laws for Small Businesses
• They also advises Small Business Owners on solutions to help their Small Business manage their tax affairs efficiently
• A Registered Tax Practitioner is qualified as a Tax expert and acts as a representative.

The expert knowledge, experience, and qualification the Tax Consultant holds determines the successful management of tax affairs in a business.

So how do you know you need a Tax Consultant or a registered Tax Practitioner?

The Tax Consultant or Tax Practitioner you need is the one who:

• will meet your business aspirations the best

To understand who this person is, you must first understand your key problem areas.

Your business accountant can mainly keep you compliant by filing your Business Tax Returns.

Your business requires a tax expert when you want to save on paying Company taxes.

Structuring certain assets, and planning for future investments, also requires a Tax expert.

Tax Consultants are experts that helps your Company saves on taxes. Tax Practitioners are generally registered with SAIT.

An expert Tax Consultant or registered Tax Practitioner usually works on a contractual basis and depending on your

• specific requirements,
• the intensity of the specialties, and
• the urgency of matters,

your expert Tax Consultant can become very expensive.

Tax Consultants has vast specialties.

Let’s look at a few specialties:

• Dealing with various Tax Audits,
• Finalizing Audit Verification’s, or
• Dealing with VAT Reviews to
• Handling legal taxation matters, fairly and meticulously.

Registered Tax Practitioners pride themselves on understanding the Tax Administration Act. They can legally assist your Business in keeping compliant and stay clear of unwanted penalties and interests.

Outsourcing taxation compliance to an expert such as a Tax Consultant or registered Tax Practitioner, gives you peace of mind. Such an expert knows and understands taxation regulations and also understands how to legally protect your Business.

Here are ways a Tax Consultant or registered Tax Practitioner can help you:

• By Managing your Business e-filing tax profiles such as CIT, VAT, EMP
• By updating your Business records on e-filing (RAV01)
• Managing Individual e-filing profiles for IT and VAT
• Applying for Tax Clearance Certificates
• Dealing with SARS correspondence
• Submit Supporting Documents for Audits, Verifications or Reviews

Registering an e-filing profile for both your Business and individual taxes, helps managing your tax affairs efficiently online.

You can visit here to register for such a profile should you not have one already.

E-filing is not a complicated process, but various problems often arise where

• correspondence issued by SARS,
• documents requested or
• verification audits require certain specific actions and
• the taxpayer does not understand how to respond or how to communicate effectively with SARS.

A Tax Consultant or Tax Practitioner can manage multiple correspondences. This ensures responses reach SARS within the time frames allowed according to the Tax Administration Act.

History Tax Returns and Assessments followed by Statement of Accounts can become a huge headache to manage. For someone with limited knowledge about The Tax Administration Act, this is daunting.

For a minimal monthly tax management fee, a Tax Consultant can keep your business compliant. Managing these monthly and sometimes weekly tasks efficiently by the help of a Tax Consultant eases many burdens.

Dealing with SARS often causes unnecessary pains and anxiety for Small Business Owners.

As a registered Tax Practitioner with SARS since 2006, I completely understand the pains and challenges you face. Your tax affairs are in good hands when you trust a Tax Consultant or a registered Tax Practitioner!

Reach out to me if you are ready to get the help of a Registered Tax Practitioner for your business.

You are also invited to join my FREE Facebook Group, PROFITABLE ONLINE CREATIVES, for a community of Entrepreneurs and Business Owners to help, support, and empower each other.

See you online!

In this blog post I share 6 Bookkeeping Tips for Adequate Record Keeping and ways to enjoy Guaranteed Business Growth. Being a small business owner or entrepreneur, managing your business should not be an overwhelming task. With so many business tools, software applications and solutions available today, business bookkeeping is becoming the easiest part of running a successful business.

As a business owner, it is important to keep adequate records of the following business transactions:

• Business Incorporation Registration and Setup documents
• A list of all Financial Institution Accounts:
  • Bank Accounts,
  • Investment Accounts,
  • Savings Accounts,
  • Retirement Funds,
  • Medical Funds and
  • Taxation Accounts
• The Business Plan with clear financial details such as:
  • Cash Flow Forecasts,
  • Assets,
  • Liabilities,
  • Projected Income,
  • Estimated Expenses,
  • Marketing Strategy,
  • Marketing Research,
  • Core Values,
  • Vision and Mission Statements
• Human Resources and Payroll Records:
  • Employment Records,
  • Key individual details
  • Temporary Staff details
  • Contracts and Agreements
  • Leave Records
  • Attendance Records
  • Overtime Records
  • Payment Records
  • Statutory Records
• Privacy Policy
• Company Values
• Health and Safety Policy
• Lists of all Customers and potential Customers
• List of all Suppliers and Trade Accounts
• Assets purchased, sold and depreciated
• Trade and Receivables, Debtor Accounts and Loans Receivable
• Liabilities such as:
  • Loan Accounts,
  • Credit Card Accounts,
  • Overdraft Facilities,
  • Staff Loans,
  • Supplier Accounts Payable
• Summary of all Income Received, Quotes Generated and Service Agreements
• Summary of all Expenses, Cost of Sales, Ad hoc payments, Taxation and Monthly Overheads

By retaining these business records, you fulfill the requirements of the national Tax Administration Act and satisfy SARS that you comply with all requirements regarding business record keeping.

About the Tax Administration Act

The Tax Administration Act requires the following business types to keep records:

A registered business that:

• filed any type of tax return
• submitted a tax return but has not yet complied
• is not required to submit a tax return, but has during the tax period,

1. received any income,
2. had a capital gain or capital loss, or
3. engaged in any activity that is subject to taxation
4. a business that would have had to submit a tax return if not for an exemption or threshold

How to preserve compliant and adequate business records:

Keep your records in the following ways:

• In its original form
• In the form, including electronic, prescribed by the Commissioner by public notice
• In the case of a request by a specific taxpayer to retain records or documents in a different but acceptable form, the form authorized by a senior SARS official
• In an orderly fashion
• In a safe place
• Open for inspection, audit, or investigation by SARS at all times

How long do you need to keep your records?

1. A business that has submitted a tax return needs to keep its records for a minimum of five years: counting from the date of submission of a return, until the last day of the period
2. A business that had to submit a tax return, but has not complied, needs to keep its records for a minimum of five years: After the end of the five-year period, indefinitely until submission of the return
3. A business that is not required to submit a tax return, but has during a tax period, received income, experienced a capital gain or loss, or engaged in any other activity that is subject to tax or would be subject to tax but for the application of a threshold or exemption, needs to keep its records for a minimum of five years or until the conclusion of the audit, whichever occurs first
4. A business that has lodged an objection or appeal against an assessment or decision under the Tax Administration Act exemption needs to keep its records for a minimum of five years, or until the disputed assessment or decision becomes final, whichever occurs first
5. A notified business that is aware that its records are subject to an audit or investigation needs to keep its records until the conclusion of the audit or the investigation

6 Tips for Adequate Record Keeping to avoid paying penalties

You can very easily lose a dispute with SARS simply because of inaccurate record keeping.

Make sure this NEVER happens to you!

Use the following 6 Tips for Adequate Record Keeping to avoid paying penalties…

Tip#1:

You can only claim deductions if you have valid proof of your actual deductions or expense.

ALL invoices issued to you can reduce your tax, so if you lose any of them you’ll end up paying more tax than you legally have to.

NB: Speak to a Registered Tax Practitioner for guidance on how to structure your business to remain tax compliant

Tip#2:

Make sure you claim ALL your Business deductions you’re entitled to.

Without valid Tax Invoices, you’ll easily overlook certain expenses that you’ve incurred.

NB: Keep a record of EVERY expense, EVEN if you’re not sure it’s tax-deductible.

Tip#3:

Determine the amounts you pay towards salaries or wages.

Keep proof such as wages in the form of

• wage registers,
• proof of payment,
• proof of employment,
• copies of identity documents of casual employees,
• acknowledgments of the receipt of payments and amounts {NB!}

If you keep all of this, you can claim all amounts paid for salaries and wages, ESPECIALLY casual wages and wages paid in cash.

Tip#4:

Make sure you can fully explain the amounts you declare in your tax returns.

SARS will question the accuracy of your declarations if you’re unable to support them with evidence. And if you can’t prove any deductions you’ve claimed, then SARS will question the validity of ALL your claims!

Tip#5:

Ensure you’re in a position to prove your declarations, as this will improve your relationship with SARS, leading to trust and a reduction in unnecessary queries from their side, saving time performing audits.

Tip#6:

If you keep adequate and accurate records, your business will run smoothly, and be easier to manage in the long run.

How Business Record Keeping contributes to Guaranteed Business Growth?

Your business growth is directly linked to your net profits.

When your business profits are calculated for tax purposes, certain business expenses can be claimed to reduce your profit. Reduced profits means reduced taxes.

If adequate record keeping is in place for your business, it is easy to identify claimable expenses.

Once your business financials are drafted and calculated for tax purposes, your business might be audited and proof of these business expenses are to be submitted.

If you cannot provide proof of business expenses in the form of the above records, your claims might be disallowed and this can result in an increased calculated net profit.

Taxation payable on this profit is also then increased. Additional penalties and interests can be added to the calculated net profit due to incorrect provisional estimates submitted.

All these additional taxes, penalties and interests have a direct impact on your business profit for the next financial year. It becomes a viscous circle and will end up depleting all your business profits.

To ensure you enjoy guaranteed business growth, it is vital for your business to implement proper record keeping principles from the start.

When you are ready to take the first step implementing proper record keeping for your business, schedule a FREE discovery session to help you implement solutions for guaranteed business growth. During this session you will also get a feel of what it is to work with a Virtual Accountant and how I help to determine your next steps in your business.

Because I am a heart-centered entrepreneur, passionate about helping other entrepreneurs build profitable online businesses, I created a 6-Step Roadmap to more clients, cash and confidence.

You can grab this free training here.

See you online!

In this blog post, I share the vital differences between Bookkeepers and Accountants for continued growth.

As a business owner or entrepreneur, you definitely benefit from understanding these vital differences between Bookkeepers and Accountants.

We all need help to grow our businesses into successful, profitable giants. But if we don’t understand the type of support we need, how are we able to choose the right support?

Professional Support Your Business Needs

The title of your support team member should align with the actual requirements, roll and purpose they have in your business.

Different TITLES and how they contribute to your business success:

• Bookkeeper,
• Accountant,
• Tax Consultant{Practitioner},
• Business Coach/Advisor

Do you know and understand the real difference between these four titles and how each Professional can contribute to your business’ growth?

If you’re like many Business owners, you might never think of why you need to understand the difference between these Professionals.

This lead to hiring mistakes and people investing money in Professional help they don’t actually need or help they are not ready for within their Business. Both of which lead to money wasted and often a resistance to hiring ever again.

Vital differences between Bookkeepers and Accountants starts by identifying two types of support you can outsource or hire in your Business. How each one provides value when utilized at the right time and help you make informative decisions.

You can also read these articles about the key principles of a Tax Consultant{Practitioner} and Business Advisor/Coach for further help in deciding what type of professional support your Business requires.

Vital Differences between Bookkeepers & Accountants

It is important to understand when you should hire or outsource each type of support in your business, and when it’s okay to combine these professional roles.

Outsourcing each professional in the wrong order is like putting the cart before the horse

Bookkeepers are needed when:

You could use help keeping your books processed and balanced.

For example, your business may be growing too fast for you to do your own bookkeeping.

If you have room in your budget, you might consider hiring a bookkeeper so you can focus on profit-making responsibilities.

Choosing to hire a Bookkeeper as an employee or as an Independent Contractor is determined by:

• the type of Business you have,

• your day-to-day requirements, and

• how you would like to invest in resources

Accountants are needed when:

• You must make sense of your financial information
• Someone who understands profitability, cash flow, and financial planning are needed
• An accountant can advise you on the most financially savvy moves you can make based on your history
• Your year-end business tax planning and filing need the eyes of an expert
• An Accountant is needed periodically, it makes better sense to outsource this expert service to an Independent Consultant on terms that will assist your Business to benefit from it

While bookkeeping and accounting differ, they have overlapping functions. Both play an important role in informing you about your business’s health and projecting future outcomes.

• Bookkeeping is the foundation of your finances
• Accounting takes care of higher-level processing
  • For example, let’s say you offer a coupon to your customers:
    • You use bookkeeping to record how many coupons are used
    • You use accounting to look at how the coupons affect your finances and the health of your business

As a business owner and entrepreneur, you can record your books with a do-it-yourself approach. If you decide to use a financial professional, make sure you hire someone with credentials that match your needs.

The more complex your financial situation is, the more likely you will need an Accountant.

Need a Bookkeeper or Accountant to assist your business with continued growth?

Take the Next Steps if you are:

• overwhelmed by your processing and work and ready to hire or outsource help

• stuck in the cycle of having enough work to be successful but not enough time to serve all your clients AND grow your business

• Ready for help, but you’re not sure what help is worth your investment

• in need of the three-part method for finding the right team member who will save you time and earn you more by getting the right work off your plate

Then it is time for a FREE Discovery session with me!

Reach out to me for a FREE discovery session so we can find you the best solution within your budget.

You are invited to join my FREE Facebook Group, PROFITABLE ONLINE CREATIVES, for a community of creatives, entrepreneurs, and business owners to help, support, and empower each other!

See you online!