David Cameron has pledged to make 2012 the ‘year of the enterprise’ and has announced a string of initiatives to encourage would-be entrepreneurs ‘set up shop’. Starting a new business can be a challenging experience though. Sally Revell, Head of Marketing at Intuit UK, provides month-by-month tips for optimising your business.
Entrepreneurs are passionate about their businesses and want to see their dreams realised as soon as possible. However, the reality of creating a successful business requires not just creativity and passion but also putting in place a sound financial foundation.
Without the right approach to cash flow management, many entrepreneurs may find themselves bogged down in paperwork, when their time could be better spent on growing revenues and working on new product and service strategies.
There are three steps that should be followed religiously during the vital first year of a business’s life.
- Firstly, it is important to break the intensive launch phase of a business into small, achievable tasks. We would recommend looking at all the steps you need to take to get your business up and running and then aim to complete one per month. By setting yourself monthly tasks you will be able to visibly measure how the efficiency of your business improves and gain the satisfaction of watching your business go from strength-to-strength.
- Secondly, make sure you stay on top of compliance. Any small business has a number of tax obligations they must meet to keep operating, from self assessment and payroll to Companies House requirements. Make sure you mark in your calendar when such compliance measures need to be completed by so you are ready in good time to provide the necessary paperwork and accounts. This will ensure you avoid nasty surprises and aren’t hit with any potential fines for non-compliance.
- Finally, make sure you network as much as possible. With 2012 shaping up to be an entrepreneurial year, there are a range of small business events taking place across the country – like Global Entrepreneurship Congress in Liverpool, and Business 2012 in London, both in March. These offer perfect opportunities for you to meet up with peers and share ideas on how to grow your businesses. You may even find potential partners and open up new business areas you had not even thought of.
- The following provides advice and tips on tasks you should look to complete over the year, as well as key compliance deadlines and useful networking events throughout 2012.
January is the perfect month for organising the year ahead. Look at sites such as bis.gov.uk and inspiresme.co.uk to get all the tools, information and support you need to start the year off on the right footing.
Dates for the diary:
January 31: Official deadline for online submission of Self Assessment tax return for tax year ended April 5, 2011. However, this has now been extended until February 2, due to industrial action.
Put your finances in order. Even the smallest of businesses needs an accountant to take the headache away from larger tax issues. Use February to find the right accountant for your business and get their professional advice on financial management and cash flow.
2nd February: Extended deadline for online submission of Self Assessment tax return for tax year ended April 5, 2011
March will see a number of useful networking events that you can attend. Use this month to make contacts with other small business owners to share ideas and be inspired.
March 7: VAT return due for accounting period ending January 31
March 31: End of accounting period (VAT Return due May 7)
March 12-16: Global Entrepreneurship Congress, Echo Arena and BT Convention Centre, Liverpool
March 18-20: Business 2012 event, O2 Arena, London
Take April to ensure that your business is effectively staffed for the year. Put in place systems and processes to flex your headcount as required, taking into account major events such as the Olympics or Christmas. For payroll, make sure that you have an effective and integrated in-house system for paying employees on time, one that will help save time and reduce outsourcing costs.
April 5: Last day of the payroll tax year
April 6: First day of the new payroll tax year
The start of May will be spent on processing your VAT claims. If not handled correctly this can be a laborious job that involves the filing of regular returns. Take the time to source decent financial management software that can take away the headache. The most effective financial management software now allows users to fill in VAT returns online directly with HMRC. This is important as from April 2012 all VAT returns will need to be filed online.
May 7: VAT return due for accounting period ending March 31
May 17-18: Business Startup Show, London Excel
May 19: Deadline for filing your Employer Annual Return (P35 and P14s) for the tax year ended April 5, 2012
May 31: Last date for giving a P60 form for 2011-2012 to each relevant employee who was working for you on April 5, 2012
Good book-keeping is central to the financial management of a business. We would recommend setting aside some time in June to ensure that your paperwork is simple to use and provides an accurate understanding of cash flow. Set aside time each week to go through all your transactions, rather than letting invoices and payments mount up.
As July is usually a quieter month, use it to make sure you are on top of current affairs. Ensure you are aware of any upcoming events or issues that may affect your business and share your views and opinions with like-minded companies.
July 6: Deadline for filing forms P9D, P11D, P11D(b), or substitutes for the tax year ending April 5, 2012
July 31: Deadline for second Self Assessment payment on accounts for tax year ended April 5, 2012
July 31: End of accounting period (VAT Return due September 7)
In August, why not look at how you can mobilise your financial management processes? The ability to manage your finances wherever you are will deliver major efficiency gains for the operation of your business. Look for a solution that will allow you to access your accounts while on the move and via the device that suits you best, whether that is a tablet, laptop or even a smartphone.
There is no getting away from it: social media is increasingly becoming a key tool for business success. In September try looking at how social media can work for your business. Use it as a networking tool, to stay on top of market trends and to improve your knowledge and business connections.
September 7: VAT Return due for accounting period ending 31st July
September 19-21: MADE: The Entrepreneur Festival, Electric Works, Sheffield
Now that your business will have been up and running for several months, you should start looking at creating an effective budget. Review your income and outgoings and make sure you have enough to cover expenses. Managing your budget efficiently and running regular reports will show how your actual income and expenses compare to what has been forecast – this will help you to anticipate potential cash flow problems.
October 7: Deadline to notify chargeability for Income Tax/Capital Gains Tax for 2011-2012, if not registered for Self Assessment
October 31: Deadline for paper submission of Self Assessment tax return for tax year ended April 5, 2012
October 31: End of accounting period (VAT Return due December 7)
One area that most businesses need to evaluate regularly is their invoicing process. In November look at what you can do to speed up the time it takes for you to get paid for goods and services. The invoice process takes more and more time as your business grows, especially as most small businesses produce invoices manually. Review how much time you spend drawing up invoices and look at whether this process can be automated to save time.
As the year draws to a close, ensure you take time before the Christmas rush to assess your performance over the year. Are there any expenses you can trim? Have all your revenues been entered? Have all of your customers been correctly invoiced? This is sound house-keeping and will ensure that you can kick off 2013 to the best start.
December 7: VAT Return for accounting period ending October 31
December 30: Deadline for online submissions of Self Assessment tax return for tax year ended April 5, 2012
December 30: File accounts with Companies House
This simple guide provides basic advice on making your business successful in 2012. If you are interested in getting more tips on small business success, please look at our blog, where experts discuss small business issues on a daily basis.
*Note: Above dates assume i) VAT quarters of January / April / July / October and ii) Ltd companies accounting period of April-March