For many small business owners, speaking to the accountant only happens when a deadline is approaching.
The year-end accounts need preparing. The corporation tax return is due. VAT needs filing. Payroll needs processing. A tax bill has arrived.
While these services are important, they are only one part of what a good accountant can help with.
Your accountant should not just be someone who looks backwards at what has already happened. They can also help you look forwards, make better decisions, improve cash flow, plan for tax, understand your numbers and build a stronger business.
The key is making the relationship more proactive.
Here are three practical ways to get more from your relationship with your accountant.
1. Communicate Regularly, Not Just at Year-End
One of the biggest mistakes business owners make is waiting until the year-end to speak to their accountant.
By that point, many useful planning opportunities may already have passed.
For example, decisions around tax planning, pension contributions, profit extraction, dividends, investment in equipment and business structure are often much more effective when discussed before the financial year ends.
If your accountant only hears from you once a year, they only see a snapshot of your business. They may be able to prepare the accounts and tax returns, but they may not have enough context to give you the most useful advice.
Regular communication helps your accountant understand what is really happening in your business.
That could include:
- A new contract or income stream
- Plans to hire staff
- Cash flow pressures
- Large upcoming purchases
- Changes in profit levels
- New business goals
- Personal financial plans
- Concerns about tax bills
- Plans to borrow money or invest in growth
Small updates can make a big difference.
For example, telling your accountant that you are planning to buy a vehicle, take on an employee, increase your prices or move premises could open up useful conversations about tax, cash flow, payroll, VAT or business structure.
Your accountant does not need to be involved in every small decision, but they should be kept informed about anything that could affect your finances.
Recommended action
Schedule a quarterly check-in with your accountant to review your numbers, discuss upcoming plans and identify any tax or cash flow issues early.
This does not need to be complicated. Even a short meeting every few months can help you stay ahead of problems and make better decisions.
2. Keep Your Financial Information Accurate and Up to Date
Your accountant can only give good advice if they have good information.
If your bookkeeping is months behind, receipts are missing, bank accounts are not reconciled, or invoices are not recorded properly, it becomes much harder to understand how your business is performing.
Up-to-date records allow your accountant to see the bigger picture.
They can help you understand:
- How profitable your business is
- Whether your cash flow is improving or getting worse
- How much tax you may need to set aside
- Which costs are increasing
- Whether customers are paying on time
- How much money you can safely take from the business
- Whether your pricing is working
- Where there may be opportunities to improve
Good bookkeeping is not just about keeping HMRC happy. It is about giving you clear, useful information so you can run your business properly.
Cloud accounting software can make this much easier. Bank feeds, receipt capture tools, invoice tracking and real-time reports can save time and improve accuracy.
However, software only works well when it is used properly. Transactions still need to be reviewed, receipts need to be uploaded and records need to be kept tidy.
Common issues that can hold business owners back include:
- Missing receipts
- Unreconciled bank transactions
- Mixing personal and business spending
- Not recording invoices on time
- Not chasing unpaid invoices
- Leaving bookkeeping until the last minute
- Not reviewing reports regularly
When your records are accurate and up to date, your accountant can give advice based on the current position of your business, not information from several months ago.
Recommended action
Review your bookkeeping process and make sure your accounting software, bank feeds, receipts and invoices are kept up to date each month.
A simple monthly routine can make a significant difference. It also means fewer surprises when tax deadlines arrive.
3. Ask for Advice Before Making Big Business Decisions
Many business owners speak to their accountant after a major decision has already been made.
This can be a missed opportunity.
Your accountant can often add the most value before you commit to a decision, not afterwards.
For example, you may be thinking about:
- Buying equipment
- Purchasing a vehicle
- Hiring an employee
- Changing your prices
- Moving premises
- Taking out finance
- Expanding the business
- Taking more money from the company
- Setting up a new company
- Selling part of the business
- Planning for retirement or exit
Each of these decisions can have tax, cash flow and profit implications.
That does not mean your accountant should make the decision for you. It means they can help you understand the financial impact before you go ahead.
For example, they may be able to explain:
- Whether the business can afford the decision
- How it may affect your tax position
- Whether there is a more efficient way to structure it
- What impact it could have on cash flow
- Whether you need to update forecasts
- Whether VAT, payroll or company tax issues need to be considered
This kind of advice can help you avoid unexpected tax bills, poor timing, cash flow pressure or decisions made without the full financial picture.
The best accountant relationships are not just about compliance. They are about planning.
When your accountant understands your goals, they can help you think ahead and make more confident decisions.
Recommended action
Before making a major business or financial decision, speak to your accountant and ask what the tax, cash flow and profit implications could be.
A short conversation before acting could save you money, reduce risk and give you more confidence in your decision.
Final Thoughts
Your accountant should be more than someone who prepares your accounts and files your tax returns.
Used properly, they can be a valuable adviser who helps you understand your numbers, plan ahead, manage tax, improve cash flow and make better business decisions.
To get more from the relationship, focus on three key habits:
- Communicate regularly throughout the year.
- Keep your financial records accurate and up to date.
- Ask for advice before making major business decisions.
The more your accountant understands your business, the more useful their advice can be.
Instead of only contacting your accountant when a deadline is approaching, start involving them in the ongoing financial decisions that shape your business.
That is how you turn the relationship from a once-a-year compliance exercise into a valuable part of your business planning.
Need More Proactive Advice From Your Accountant?
If you would like to discuss your accounts, tax planning, cash flow or wider business decisions, you can book a meeting with John Morgan.
