Every sole trader needs a guide to managing their financials. Your financials could be anything from expenses to paying your employees. Regardless, knowing yourself, and what you spend daily will reduce your financial burden. This will guide will help get in check of your finances and provide you with useful steps.
Don’t rely on yourself but get support
As a sole trader, it is unlikely you can complete every aspect of your day-to-day workflow, as well as your business upkeep. You may have the abilities, or the time, to complete everything that needs to be completed. But do you have the funds available to get the job done? Or do you have difficulty delegating tasks over to others? There are areas of your businesses that you could outsource for support.
With an accountancy practice, like Carrington Blake Accountancy, they are able to offer you financial advice and support when it comes to filing documents to Companies House and HMRC. If you require advice or support, contacting us will offer you a sense of clarity in seeing where you need to focus more because we take the workload off you.
As a sole trader, you have to be registered for VAT. If your turnover exceeds the normal VAT threshold. The current threshold sits at £85,000 and is made up of taxable supplies. Sole trader businesses will opt voluntarily to register for VAT, as it will have financial benefits.
One negative point is you end up losing money as a result of paying VAT, such as if your output tax (which is the VAT you charge will be pushed beyond the input tax). Also, which is the actual VAT you pay and you will lose out. This will create more paperwork, this is a time-consuming process that you will be reluctant to do.
If you want to find out which VAT scheme you can go for, contact us now to find out how we can get you registered for VAT today.
Have a contingency plan for your funds
One of the biggest struggles you will face as a sole trader is being unable to work due to illness, holidays, and other factors. Therefore, a contingency fund allows you to keep yourself afloat when these circumstances arise. This is very essential for anyone using your services. For instance, your clients need reassurance that the job will be completed.
The best way for you as a sole trader is to have a plan for your jobs and organise your spreadsheet. The spreadsheet will have a big list of your clients. but, as well as the completion dates. Updating what has been completed on the sole trader accounts. It’s your job as a sole trader to plan ahead and have a contingency plan.
Setup a Business bank account
As a sole trader, you may be thinking you have everything covered. However, something as simple as setting up a business bank account will allow you to have more control over your income. Instead of your business income mixing in with your personal bank account, you have these two things separated. This will mean that you will be able to see how much income has come from your business and how much has come from your other sources of income.
By having this level of money management, you will also be able to see how much is being spent on your business needs. This will therefore mean your bookkeeping for your business will be easier to manage as now you will just have to separate them and label them to what they are.
Insurance for Sole Traders
Like any business, being insured is something sole traders will need to do to run their company. There are many different types of insurances you may need as a sole trader depending on the type of company you have. W
you might go for the standard business insurance. Consider getting public liability or professional indemnity.
How Can We Help!
There are many options one may be… Carrington Blake accountancy comes for your accountancy needs. We will call you to arrange a meeting with a Consultant, this service is free and there is no obligation to use our services. This meeting is essential in helping us evaluate your business needs. Once we have had the consultation you will be provided with a fixed quote which will be supplied to cover all the work we believe needs completing. Our quote stands for a month so you have plenty of time to think things over.
Call us for a quote on 0207 537 6628