By Sam Bacall, Partner 

Running an independent business brings with it many challenges and questions.

With so many plates to spin, it can be hard to focus on the things that matter most.

Having worked with many independent businesses like yours, we’ve seen what works and what doesn’t when it comes to growth and success.

There are a few key questions that we believe every independent business owner should ask themselves if they want their business to thrive.

Do you have the right business structure in place?

The business structure you choose when you start out is not necessarily the one that will serve your business long-term.

If you started out as a sole trader, now might be the time to incorporate your business as a limited company.

Or, if you began as an ordinary partnership, perhaps registering as a Limited Liability Partnership (LLP) is the next step.

The structure of your business affects everything from your tax reporting obligations to the way in which clients, investors, and stakeholders will view your business.

Needless to say, this makes it crucial to get your business structure right.

Whatever stage of business you’re in, it’s worth reviewing your current structure to check whether it still works for your business or if you need to explore other options.

Do you know when your key tax deadlines are?

You may not like to think about HM Revenue & Customs (HMRC) too much, but unfortunately, HMRC is constantly thinking about you.

There are a range of essential tax deadlines for tasks such as filing quarterly reports and submitting P11Ds.

Each quarter, and almost every month, brings with it a new suite of tax payment and registration deadlines, so it is important to keep on top of your tax calendar and make sure you know exactly when each of your key deadlines are.

What is the current state of your cashflow?

While many independent businesses take care to keep an eye on their profit margins, your cash flow is just as important, especially in the early stages of business.

A positive cashflow means you have more money coming in than going out.

A negative cashflow, on the other hand, means you have more money going out than coming in, which can have a detrimental impact on your business.

Issues such as overdue payments, unexpected tax bills, and seasonal dips in sales can contribute to a poor cash flow, so it is essential to take steps to prevent these problems from occurring.

For example, you can make your payment terms shorter and chase customers regularly to make sure you are paid on time.

You should also ahead and set aside funds to cover unexpected tax liabilities and tide your business over during seasonal fluctuations.

Are your financial habits serving you?

Good financial habits are the foundation of a healthy, sustainable business.

Unfortunately, it can be all too easy to fall into bad habits that risk derailing your business entirely.

Implementing regular financial review tasks on a monthly basis is a great way to start building better habits.

For example, you should:

• Back up your financial records securely (for example, by using cloud accounting software).
• Review your cashflow, bank balance, and upcoming bills and loan repayments.
• Check your sales and income against your targets.
• Set aside money for future business costs.

Have you sought the advice of an experienced accountant?

You might be the expert on your business, but when it comes to managing your finances effectively, nothing beats the knowledge and experience of a chartered accountant.

Our team of friendly professionals can help you manage your accounts, take care of complex tax issues, and offer practical business advice.

When you join us, you’ll get a dedicated Partner who will be your go-to person for all your accounting and auditing questions.

If you would like help setting up financial systems, getting into good habits or making sense of your accounts, why not give us a call?

For more practical advice and guidance, download our guide to independent business today.