For many of our clients — small businesses, freelancers, and growing teams — we’re a sounding board, a strategist, a network matchmaker, and sometimes, even a bit of IT support. Here we explore five surprising ways our team goes beyond the books to support the real people behind the businesses we work with.
New financial year… new business?
Using the excitement and ambitions that a new year provides, launching a new business seems like the perfect move right now.
However, it’s not an easy process and can quickly become overwhelming if the appropriate steps aren’t followed. Turning your entrepreneurial dream into reality requires careful financial planning and an understanding of key regulatory requirements.
This guide covers essential financial tips for startups in Scotland, including choosing the right business structure, breaking down tax obligations, and managing your startup finances effectively.
Before you start trading, you need to decide the structure of your business. The legal structure of your business will dictate your tax obligations, liability, and overall operations. In Scotland, you can choose from the following common business structures:
For many startups, forming a limited company is an attractive option due to its ability to limit personal liability. However, it comes with additional administrative requirements. Many businesses start as sole traders and transition to a limited company as they grow.
Consider seeking advice from an accountant or business advisor to determine the best structure for you.
Once you’ve chosen a business structure, you’ll need to register it with the appropriate authorities. Here’s what you need to do:
Keeping personal and business finances separate is essential for accurate accounting and tax compliance. Most high street banks offer business accounts with features tailored to startups. When choosing a bank, consider factors such as:
A well-thought-out budget helps prevent overspending and ensures financial stability. Key elements to include:
Use budgeting tools like Xero, QuickBooks, or FreeAgent to track your cash flow and expenses efficiently. We have experience with all platforms, but as a proud Xero partner, we cannot recommend it enough!
New business owners must understand their tax obligations to avoid fines and compliance issues. Key taxes include:
Working with a qualified accountant can help ensure your tax affairs are in order and that you’re taking advantage of any available reliefs.
Many startups require external funding to get off the ground. There are several options available:
Before seeking funding, ensure you have a solid business plan and financial projections to demonstrate viability. Lack of a strong business vision will not lead to strong results.
Poor cash flow management is one of the leading causes of business failure. To maintain healthy cash flow:
Consider using accounting software to automate invoicing and cash flow tracking.
Starting a business can be complex, and professional guidance is simply invaluable. Some key resources are:
Starting a business in Scotland is an exciting journey, but financial planning and compliance are crucial for long-term success. By choosing the right legal structure, understanding tax obligations, securing funding, and managing cash flow effectively, you can set your startup on the path to growth in the new year. Don’t hesitate to seek professional advice and use available resources to make informed financial decisions. It’s recommended to find a trusting business advisor or an accountant who specialises in helping startups thrive.
Accounting standards that impact businesses’ financial reporting are prone to the odd reshuffle every now and then, so it is important for business owners to stay informed.