Running a business isn’t just about the services or products you provide to customers, there’s a lot of admin going on behind the scenes to make sure that everything runs smoothly. Keeping your finances safe, secure, and on track is one of the most important tasks, because without a handle on the money you risk losing the business altogether.
And it’s not just thinking about the money coming in and out: protecting against fraud and embezzlement, keeping accurate accounts, and managing employee payroll are all vitally important aspects of running a successful business.
Business Bank Accounts
Unless you’re operating as a freelancer, sole trader, or contractor, you need to set up a business bank account. These don’t work the same as personal bank accounts and the services aren’t free, but many come with additional extras, like their own accounting software or compatibility with existing providers. Being able to link your accounting together is a big advantage, as keeping everything in one place helps to reduce errors made during transfers and reporting.
- To open a business bank account you’ll need your ID and proof of address, plus Company’s House registration details, VAT number and tax details, if applicable.
- While all high-street banks offer business account services, there are also several online providers who offer great deals. Make sure you research different accounts carefully and choose one which best suits your needs. For example, if you’ll regularly be depositing or withdrawing cash for a till or float, then a high street bank is probably your best option. If you need to do most of your depositing by cheque, it’s worth finding an account which accepts photo deposits.
- If you already use accounting software, check that the bank account is compatible, or consider switching if they have their own. If your software all communicates with each other, it’s far easier to track activity and spot anything untoward going on.
- Don’t scrimp on the security. Small businesses can be big targets for hackers and fraudsters as they don’t have the same security measures in place as large corporations. Thoroughly check and train every employee who handles the finances, keep the number of people with security details to a minimum, and only use secure transfer methods to move your cash around.
When you have employees, whether it’s just one or several dozen, you need a solid payroll system to make sure that everyone is getting paid what they’re due. Having an automated system will also help if any disputes are raised, as all transactions will have been properly documented.
- There are several out of the box payroll solutions out there which can be used to get you up and running quickly. These make it easy to input employee details, produce pay slips, and print tamper-resistant security checks.
- To set up an employee on your system you’ll need an employee reference number for them. This can be applied for from the relevant tax authority. You should also get a tax code, so you know how much income tax and other contributions to withhold.
- Make sure employees fill out the relevant new starter forms so that both you and the government know how much tax they should be paying.
- Make sure you keep an accurate record of all hours worked, including overtime and extra shifts, as well as other benefits received such as company vehicles, healthcare plans, and pension contributions.
Keeping proper formal records of all financial transactions is vital to ensuring your business’ survival. Not only will it mean that disputes are easily settled, but you’re less likely to become a target for fraudsters and thieves. And if the tax man comes knocking, you’ll be confident that all your affairs are in order and won’t be subject to any unexpected fines.
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