Guide to managing your year-end
When managed correctly, the year-end is not something that should be feared by individuals or businesses. Indeed, it should be seen as an opportunity to see where money can be saved.
A poorly managed year-end, however, can result in stress and mistakes. Preparing in plenty of time, having efficient systems in place and communicating well and working in partnership with your accountant will ensure that the year-end runs smoothly, minimises tax and even finds ways to boost profits going forward.
Managing the year-end – For Individuals
For people who are company directors, have numerous investments or a property portfolio, the end of the tax year can be nearly as fraught as it is for businesses. Communication is key to making it less so.
Always keep your accountant up-to-date on your affairs so that when the year-end comes, you are both ready to deal with tax incurred through company dividends, investments, property, capital gains, pensions and inheritance. By having all the necessary information ready in plenty of time, your accountant can make sure you pay what you owe but also find ways to minimise tax.
Managing the year-end – For Businesses
Preparation and efficient systems are the keys to making your company year- end as painless as possible. Every business owner knows (or should know) how important it is to keep all the right documentation and prepare the appropriate reports, yet some still end up in a panic, having forgotten to notify employees that they need to get their expenses in or update all their information. Making time for a stocktake is also something that gets forgotten and leads to unnecessary hassle.
Again, good, ongoing communication with your accountant will help you get everything that needs to be done completed in good time. But an absolute must for making your year-end stress-free is an easy to use and efficient online accounting system like Xero.
If you are still doing everything yourself on Excel, you are missing out on all these benefits:
- Invoicing and Purchasing – generating invoices and managing purchases with an online system makes producing a profit and loss report a doddle.
- Payroll – keeping all your payroll information together with everything else also makes end of year reporting easier
- Expenses – managing expenses online is not only convenient but allows you to see where your money is going very easily.
- Bank reconciliation – without an online system, bank reconciliation is one of those headache jobs.