Each January, most of us make resolutions relating to our well-being. Be it a new diet, giving up our vices or being more productive, each new year lots of us vow to make positive changes.
April 6th brings a new tax year, and as we all adjust to the announcements of the Chancellor’s final budget, its a perfect time for all contractors to consider the new financial year resolutions that could be made to secure financial well-being for the new financial year. We’ve made some suggestions that we believe could add peace of mind and infinite value to your business as a contractor:
1) Invest in a good accountant
As with any business owner, financial health is imperative for a successful life as a contractor. Working with a professional accountant will not only ensure that you’re working in the most efficient way possible, but also will ensure that the myriad of tax rules and laws are complied with, leading to a peaceful night’s sleep. Here at Green Lantern, we provide these services to our accountancy customers on a regular basis, and work with leading advisors to ensure that our services are compliant and supportive in the areas you require.
2) Be smart with your accounts
Many contractors make the error of using their personal bank account, even though as a limited company owner they should always be using their business bank account for finances and expenses. Separating business and personal transactions can be stressful and time consuming, and the easiest way to manage this, both for you and your accountant, is to ensure that you use your business bank account for all professional financial matters.
3) Be organised
It pays to keep yourself organised throughout the year before the time to pay up to the tax man comes around once more. Your professional accountant will assist you with this, and if you need any help give us a call, as we have many useful hints and tips which will assist. However, always keep in mind your tax bill, and use a business savings account to ensure there are never any nasty surprises come the time your taxes are due. Your accountant should always advise when deadlines are – if you’re not getting help in this area then make sure you chase your advisors for it. Our online portal has a ‘key dates’ section – take a look at this any time and keep those dates and tax bills in mind.
4) Consider a pension fund
Whether you’re in your twenties and just starting on your freelancing career, or you’re a lifetime contractor looking to the future, saving for your retirement is a financial essential, especially for an independent professional.
Business owners don’t benefit from auto-enrolment into company pensions schemes. This means that you have to research and find a pension plan that suits your circumstances and lifestyle. A pension isn’t a luxury you can afford to waive for decades. We’ll all retire one day, and you’ll thank your younger self for getting organised as early as possible. We work with professional contractor advisors and can put you in touch with them at any time, just let us know.
5) Set up a contingency fund
As a business owner, you’re always at financial risk of an occasional client that may not pay you on time or unexpected costs, travel or essential repairs to equipment. An emergency fund is invaluable in circumstances when you’re cash flow has taken a hit and you need some money to cover your day to day expenses.
Here at Green Lantern, we are always happy to help you implement these new tax year resolutions which we believe will not only give peace of mind, but also ensure that your business is protected from any unexpected occurances which a business owner should always be prepared for.
If you would like to hear more about how you can help, call our experts on 0207 164 2116.