There are a lot of advantages to being your own boss. But when it comes to tax strategies and financing, many owners of startup businesses find themselves at a loss.
If you want to set your small business up for success, follow these simple tips.
How to Finance a Startup Business
Financing your business is one of the biggest hurdles you’ll face in getting your startup off the ground. Here are a few methods for financing your startup:
- Applying for a bank loan
- Attracting angel investors
- Using a credit card
- Tapping into your 401(k)
You should think carefully about the risks you are willing to take on to finance your startup, especially if you choose to borrow money.
However you finance your business, the most important thing you need to do is make the money count. Smart money management can make or break a small business.
Financial Tips for Small Businesses
There’s a learning curve for small business money management. Here are three helpful financial tips to get you started:
1. Only Pay for the Insurance You Need
Overpaying for insurance is a common misstep for startups. Assess your risks and only invest in the insurance you absolutely need. If you’re working from home, for example, your risks are limited and can probably be covered by your existing homeowner’s insurance.
2. Always Use Contracts
Show your clients that you’re a legitimate business by setting up contracts. This is the best way to ensure that you always get paid for the work you do.
3. Build a Network You Can Rely On
Part of being a smart spender is knowing when you need to hire outside assistance versus when you can rely on other businesses in your network. When it comes to finances and bookkeeping, you can’t go wrong with hiring an accounting firm.
But you might be able to tap into your network for certain services, such as graphic design. Consider trading services with other startups and small businesses rather than paying fees elsewhere.
Tax Advice for Small and Startup Businesses
The taxes you pay on your earnings depend entirely on the structure of your small business. If you operate your business as a sole proprietorship, you don’t necessarily need to make quarterly tax payments right away. Corporate entities, on the other hand, need to file taxes as they earn income.
Here’s another piece of advice: set aside self-employment taxes as you earn. This will prevent any unpleasant surprises when it’s time to pay during tax season.
Contact Marshall Jones for Accounting Services
If you’re managing a small business, you know that it’s important to strategize when it comes to your budget. Outsourcing accounting services to an experienced firm is a cost-effective alternative to hiring an in-house accountant — and it allows you to focus on the project at hand.
This tax season, look no further than Marshall Jones for reliable accounting services in Atlanta, Georgia. Contact us today to learn more about how our Certified Public Accountants and Advisors can help your startup business grow!