For most people, New Year starts on the 1st January. This is the time to review the previous year, to plan and set SMART goals for the next twelve months. Business owners, freelancers and anyone self-employed in any other capacity are greedy – we have two New Year dates! For businesses the beginning of a new financial year, April 6th each year offers an additional chance to shake things up.
The focus at the beginning of the new financial year tends, predictably, to be more focused on finances. These top tips for a fantastic New Financial Year offer you opportunities to fine-tune your business finances in order to meet your other business goals and increase your profit.
Complete your tax return straight away
Once the “old” financial year ends you can send your tax return into HMRC so that they can send you your tax and National Insurance bill. Or, you can do what many tend to do which is promise yourself that you’ll do it in April, then May, then September, and then find yourself scrambling to get it done before the January 31st deadline. It isn’t worth the stress. Put time aside in April to get it finished so you can concentrate on the year ahead.
Streamline your finances and stop wastage
The beginning of a new financial year is the ideal time to review your finances and to streamline your processes. The first task on this list should be to check what direct debits you have going out and assess your spending. Having done your tax return already (seeing the benefits of this now?) you will be able to see how much you are spending on coffee, at networking events, on business-related publications, subscriptions and so on.
This is the time to use the data available and cut the fat. See where money is being wasted and put measures in place to reduce this for the rest of the year. Saved money can be put back into the business, could help you outsource some of your less enjoyable yet essential business tasks to a Virtual Assistant or go into your take-home earnings.
Set up a better financial system moving forward
Are you someone who finds themselves digging into a large envelope of paper receipts at the end of the year, who forgets to pay bills and who has no idea about what they have coming in or going out? Some people are fabulous at bookkeeping and financial organisation, some just aren’t. It would be boring if we all had the same skillsets. Take this opportunity to set up a system that works more efficiently for you. Use an accordion folder for monthly papers, scan or use an app to snap and save your receipts and if you aren’t already, consider using digital accounting or bookkeeping software. This will be a legal requirement for HMRC once Making Tax Digital becomes mandatory for self-employed business owners who are not yet VAT registered.
Put your prices up
No-one likes telling a client that they are putting their prices up but if you want your business to stay ahead and grow it has to be done. The cost of running your business increases annually and at the very least you should increase your prices in order to meet this increase. On top of this, consider the fact that by the end of this financial year you will have 12 months more experience in your business than you did the previous year. This level of skill and experience is something that should be reflected in your prices.
Outsourcing your admin and financial tasks
If admin tasks fill you with fear and irritation or you are someone who likes to ignore them completely, outsourcing may be for you. I work with many clients, from sole traders to larger businesses and by delegating these tasks out to me, they are happy in the knowledge that they are done, done right and that they can concentrate on other core business work.
What are your top tips for managing your business finances? Find me on social media where I would be happy to continue the conversation. Or contact me at firstname.lastname@example.org or on 07970 955535.