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Financial New Year’s Resolutions for SME Owners - Fleximize

Financial New Year’s Resolutions for SME Owners

The new year is the perfect time to regroup and revisit your company's financial practices. Here are four resolutions to keep your business in the green this year.

By Tony Mills

As an SME owner, January represents a clean slate. It's the perfect opportunity to sit down and reflect on the previous year before setting the tone for the next 12 months.

It's crucial to consider your yearly budget, and establish how you can make savings that will add up throughout the year. With that in mind, here are four money management tips for small business owners to act on in January.

1. Free up your time

For any startup or small business, it’s essential to divide time between keeping the day-to-day running smoothly and managing the bigger picture, such as planning for the next phase of growth. As such, outsourcing marketing, IT, bookkeeping or payroll can all help to free up your (and any employees’) time and provide continuity, operational expense control and a degree of risk management. 

If you have limited budget, consider outsourcing in an area where your current team struggles, as this will give you the highest ROI. It can be difficult for any passionate SME owner to hand over control of particular business functions to freelancers or agencies, but keep in mind that the quality of work, cost of delivering work, and your free time could all be better off in the long run.

2. Manage cash flow

One of the main reasons why SMEs fail is because they don’t properly manage incomings and outgoings. But there are steps you can take to safeguard your cash flow and avoid falling victim to unbalanced books:

3. Get what you’re due

There are several forms of tax relief open to startups and small businesses, yet many businesses have little understanding of the tax entitlements they are eligible to receive. Here are a few examples to consider:

4. Attract investment

The Seed Enterprise Investment Scheme, or more commonly known as SEIS, is an indirect tax relief which can benefit small businesses by making them more attractive to potential investors. In 2015-16, 2,225 companies received investment through SEIS, but it’s still not widely-known.

As a way of fast-tracking your business to the next stage of growth, SEIS could offer a lifeline for those finding access to finance difficult by offering investors tax relief on Income Tax, Inheritance Tax and Capital Gains Tax.

However, there are certain criteria which need to be met: 

If you do qualify, your business could raise as much as £150,000 over three years through the SEIS scheme. 

About the Author

Tony Mills is the director of Online Tax Rebates, one of the UK’s leading online tax consultancy services, claiming on behalf of hundreds of thousands of taxpayers for entitlements such as uniform maintenance, professional membership and subscription fees.