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Bedroom to boardroom: 7 ways to manage the transition when your business becomes more than just you.

Bedroom to Boardroom

The most exciting thing about starting your own business is when you start to see the fruits of all your hard work pay off.



As your business starts to grow, seemingly so do the number of plates you need to spin. At Heelan Associates, our team are experienced in helping small business owners across Hampshire understand how to make the most of their growth, so they can move from spare bedroom to boardroom, seamlessly.



Here’s our helpful guide on helping you navigate your way from running your business from your bedroom into a more formal setting, whether it be your own premises, sharing space with another business or simply hiring in more talent.



1. Create a plan and a vision



This is probably the most important point. We will mention financial planning more later in the post, but the wider issues must be considered at the same time:

How will the business look ‘when its done’?
What is the ideal / your vision for the business?

If this is too wide a question, how do you want it to look in 3 or 5 years time?

What people, premises and equipment etc might you need for this version of the business?

How much money will you need? What will your sales figures need to be? How many customers will you need?

Starting at this point can form the basis of whether what your feel like you need to do now, is actually working towards this vision. It could be easy to think ‘right now I need THIS’, but in reality what you think you need could be outdated in 6 months as you had not considered the wider future.

Moving forward you should actively look to review and work on this plan. Some tips on time management and this area can be found in our related blog post here.



2. Create systems

When you are starting out on your own, you think that as you know how everything in your business works you don't need a ‘procedures manual’ or similar - it could feel like a waste of your valuable time.

We will suggest here that in fact everything you do should be viewed as a template for your business ‘system’. When you do make that next stage and bring someone else into the business, how will you train them? If you have checklists, guides, and a robust system, it will be a LOT easier.

As a business that has been on this journey, we cannot stress how much this stage will help you as you grow. Your system will never stay the same, and arguably shouldn't, as you adapt your work to get better and better at what you do, but the fact you can update these systems will help every person you bring into the business as it grows. It is far easier to do this now than it will be if you start to see the cracks appearing in your business later down the line!




3. Figure out what’s missing (and how often you need help)

Now you have your vision and systems, it’s time to decide what you need now that will help you on your journey to reach that vision.



You may need full time help with repetitive (but important!) tasks like order fulfilment, running front of house, or simply an extra pair of hands to deal with paperwork. In many cases you might just need a little extra help, not necessarily full time, or permanent.



The relatively recent rise in freelance workers means you can potentially get an experienced pair of hands, without the obligations and employment costs of a full time contract. Before you consider this, make sure you’re aware of the rules of ‘IR35’ (though all freelancers should be aware of this too), to ensure you stay compliant.

These rules apply where it is clear the person really should be classed as an employee, as the BBC themselves recently fell foul of with a presenter providing services through her own company. We can give you some essential highlights and pointers in this area.



If considering an employee, really think about whether its part or full time you need. Could you build on several part timers as the business grows? Or could your hire grow with you, adding additional hours or days later down the line?

There is a great market for either multi-role, multi-job workers in the economy, along with parents looking for school hours/childcare friendly hours - if your role suits these times, you should be spoilt for choice.

4. Understand your options to expand your business operations



The rise in popularity of more flexible office spaces such as co-working set ups mean that it’s really easy to move your business out of the spare bedroom and into a professional serviced office environment.



Regus has locations across Hampshire, including in Waterlooville, Portsmouth and Havant.
http://www.innovationspace.org.uk is a great local space, as is http://pureoffices.co.uk/portsmouth/

With a bit of a google, these type of spaces can be found all across Hampshire and the UK.



Planning the financial impact of a move is very important to the cash flow. If entering into a lease you may have:



Cost to physically move

Rent up front and deposit, including VAT

Solicitor costs

Utilities and rates costs

Service charges

This list could go on, so we always recommend a review of the budget (or getting one set up! See below) in these circumstances.



If you don’t need a physical office but want to work remotely with a few team members, then technological advances in remote team collaboration have come on leaps and bounds, such as team collaboration platforms like Slack, Microsoft Office 365 & Team, even Google Drive.



5. Forward planning your finances is key



Transitioning from a business which is just you, towards creating a business in its own right is a rewarding, but often stressful time! The costs can start to spiral and without the right planning can see cash flow plummet, shortly followed by the previously successful business.

Now you have your vision, your systems and know what you need, its time to make it a reality - and more importantly check it is a sensible thing to do!



Creating a budget as you grow is not a choice if you want the business to succeed.



Budgeting is key in a growing business, for example to understand the full costs of employment:

  • Employers National Insurance (and the impact of the really useful ‘Employers Allowance’)
  • National Minimum and Living Wage rates and how they apply
  • Pension - do I have to contribute & how does it work?
  • Payroll – what is involved with actually paying someone?
  • What is the true cost to the business considering the holiday pay I will need to pay?



Make sure you’ve thought ahead as if you’re making the commitment to hire someone, you will need to ensure your business has the resources to pay them. We can help you explore the various options for future planning, considering business loans or ways to maximise your working capital.



6. Hire in the pros



Aside from running your business, you’ll need a crack team of support as your business grows to help you navigate the waters from IT support, to HR & Legal advice, and of course a great finance team.

It’s important that you find a support system that suits your needs right now and can grow with you, as your business - and demands - become naturally more complex.

Quite often these areas will be outsourced, in fact with a service like IT support, its very common that this remains outsourced. It can be tempting to think you can do everything yourself to keep the costs lower, but at some point there is a cost to your business (and maybe your sanity!) in doing it this way.



What could you be doing instead of fixing that computer or doing your book-keeping?



How much money could you earn, or what difference could you make in your business if someone else was doing this?



As finance people, we are not suggesting wildly spending out on outsourced everything - you will need a sound budget and plan, but investment in these areas can make a massive impact to your business and your time.



At Heelan Associates we are lucky enough to work with some excellent clients in most industries and as such have a great professional network, so can normally provide contact of a business that can help with your need.



With regard to employment law considerations when taking on an employee, we work closely with the leaders in this area, Peninsula, to be able to offer clients direct free access to employment law advice to help them with these queries.

7.Try to enjoy the ride



So, after reading all that you may think it sounds like a headache. Well often it is, but it is rewarding. We’ve been lucky enough to work with some fantastic business that have been on this journey, and the hard work is always worth it, so try to enjoy the ride! This means carving out some time for you and not forgetting any family or significant other you are lucky enough to have. Business can be all consuming, so its important to schedule downtime.



Tips on this is probably a whole other article, but for now its simply good to say, schedule at least one day off a week where you do no work, and get those important family holidays in the diary, even if it’s just several long weekends.



Have questions about any of the above? In this situation and would like an experienced hand on the journey? Contact the team who will be happy to cover in more detail.

 

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We are recruiting!

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Would you like to:

 

Work with professional, enthusiastic and highly motivated people,

Providing a professional yet personal service,

In a rapidly growing business,

Helping small businesses thrive?

Then we may have a job for you!

 

We have the following opportunity to join our team:

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7 Ways To Make The Most Of Your Part-Time Business.

Part-Time-Business

Running another business alongside your 9-5? Here at Heelan Associates we love supporting small business owners across Hampshire.

 

Here are some handy hints to maximise your limited time whether it be running an Etsy shop, selling on eBay or running a blog that’s starting to make some income.

 

Whatever your passion project, we’re here to help you save your time on admin and help maximise your extra income. Contact us about how we can help you with your accounting, book-keeping and tax returns.

 

Here we give you a few tips on making your business work, streamlining your operation and really maximising your time:

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11 Tips To Help You Get Your Start-Up Business Going

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So you’ve decided to take the plunge and launch your own business, congratulations!


It can often feel nerve wracking making the decision to go it alone and get up to speed quickly, with all of the things you need to do in the early days to get yourself set up.


To help you on this journey, we’ve given you a list of some of the main things to consider when you get started.


1. To be a Limited Company or not?


This one is a long topic that we cover fully in our initial meetings when approached by someone looking to start a business. Some of the main points we consider are:


Do you need to be limited because of your prospective client? 


In ‘contracting’ type situations, often an agency will require you to be a limited company to do business.


Are there tax savings in forming a Limited Company? 


Currently in the UK, limited companies are one of the most (if not the most) tax efficient ways to operate and be paid if used correctly. This means more money in your pocket, not the tax man’s.


Is there a liability reason to be a Limited Company? 


Would you benefit from having your personal assets protected against any potential claim if one of your jobs went wrong? Will you have staff or other risk areas that could make it a good idea to protect yourself personally?


Does your business type justify the cost? 


Running a limited company costs more than being a ‘sole trader’ (think self employed without a limited company) due to the regulations and tax law surrounding it. We compare this cost with potential tax savings to make sure it is at least break even.


 2. What to call your business?


There is a lot of marketing information available online to read with suggestions on the ‘do’s and don'ts’ on brand or business names, but the key point if considering a limited company is that the legal name of the company does not need to be the same as your ‘trading name’.


So, if your brand/business name is Mary’s Cakes, you do not need a company called Mary's Cakes Limited (although this is often a preferred choice).


The main issue when choosing a limited company name is to make sure it’s available! We can help suggest alternatives if your favoured name is taken, as often only a small tweak is needed.


We would always recommend doing your research (read: google it!) on any potential trading or brand name, to make sure someone else hasn’t already done that!


3. How to form your company?


Well, if you are not going down the limited route this point will not apply but stay with us… (perhaps skip to point 5).


You can have the company formed directly with Companies House for a very modest fee.


We would not advise doing so however, as you will miss out on some of the legally required documentation the company needs in terms of company registers and other documentation. We can help draw these up and ensure you are legally complying with the Companies Act.


We can also help choose your ‘SIC code’. This is the code that tells Companies House what type of business you are in.


Want to talk to us about your business? Get in touch.


4. What should I put as my ‘registered office’?


Again, this one is for the limited companies.


When you form a limited company, your personal address will end up on the public record at Companies House unless you provide a service address/registered office address different to your home. This means marketing companies (or worse still, disgruntled customers) know where to find you from a quick google.


As a result, its normally standard practice to have a registered office address which is not your own. We provide this optional service.


You can, and most do, use your own address on invoices and for correspondence, this will be your ‘trading address’.


5. How do I tell the taxman I am going out on my own?


If you form a limited company, there maybe several taxes you need to register for (Corporation Tax, Payroll schemes etc).


If you are a self-employed/sole trader, you will need to register as such with HM Revenue & Customs (‘HMRC’) in order to receive a tax return. These are normally done online.


We can help you with registration in all these different areas to make sure you get this right, as a wrong date in the wrong box can mean further form filing, or in some case financial penalties!


6. Do I need a separate bank account?


We would always advise yes.


If you are a limited company, you will need a new one as it is legally different from you as an individual. If you are a sole trader, it is always preferable to separate business money from personal, not least because it helps ensure certain costs (such as bank charges) are fully tax deductible.


If you are a ‘fresh’ new limited company, you will need to have formed the company and be able to provide your ‘Certificate of Incorporation’ to the bank. They may also ask for a ‘UTR’ (unique tax reference). This isn’t required to open a bank, but bank’s like to hold the information from the start. This tends to arrive around a week after formation depending on how you form the company.


We have great ties with some of the local banks and are able to help clients with this process. Ready to talk to us? Get in touch.


7. Should I be VAT registered?


Again, this one is a long question, but in short, if you deal with the public, in the early days of business it is often not a benefit to be VAT registered for most businesses.

If your clients/customers are VAT registered businesses, the reverse is true and it’s often a tax saving from the beginning.


We can help run through a few scenarios and advise on the best course of action, as each business situation is different. We will also discuss the legal things you need on your invoices if VAT registered.


8.How am I going to get paid?


Ah, the most important question once you have the structure of your business sorted!


Many businesses will send out ‘invoices’ for their fees/work. If this is you, you need to think about payment terms (i.e. will you allow people to pay later, say 14 days from receiving the invoice).


There are some great payment solutions available now at low cost from card machines that vary in transaction fees (such as Paypal, iZettle), to excellent direct debit tools (such as GoCardless).

If you are a more ‘cash based’ business, such as a shop, then you will need to consider a till system. 


HMRC are moving towards a digital accounting and tax based world, and as such any system considered should be digital to ensure you are ‘future proof’ (well…for the foreseeable future anyway!).


Regardless of what you do, make sure your invoices/till receipts are numbered and uniquely identified. Some people do not like the idea of issuing INV-001 for the first time, so feel free to do INV-0100, 0101 etc!


If you are a limited company, invoices should have a note of the companies legal name, registered office address and company number. These are often shown in small print at the bottom.


As electronic payment is the norm in the world now, displaying your bank details for electronic payment on your invoices is advisable. Just remind those clients/customers to include your invoice/receipt number as a reference on their banking when they pay you!


Trust us, this is so important.


9. How do I keep my books and records?


This one again is a wide topic for discussion, but in general these days we would recommend using some book-keeping software. In fact, specifically the two market leaders, Xero or Quickbooks Online.


Combine these with some other fancy technology, such as the receipt picture taking app, ‘Receipt Bank’ you can save yourself some serious time in book-keeping.


As a minimum, you need to keep all your business receipts, invoices and anything related to your business for around 7 years.


The software solutions will eventually be a must, as HMRC launch their ‘Making Tax Digital’ initiative from April 2019. There will be a need in the future under these plans to transmit income and expenses data digitally each quarter, so choosing software now will get you ready for this.


In this area, we really are experts and can chat through various ways, customised to your business, to help you keep your books easily. In many cases, we provide cost effective book-keeping services to clients, or a mix of client book-keeping and us reviewing and reconciling.


10. Do I need a website?


Well… what do you do when you want a product or service? 


Chances are, you type it in google, or pop on social media. With this in mind, it is a good idea. Luckily for you, there are some great low cost ways to do this (Weebly, Squarespace etc). For something more custom or complex, we have some great professional connections that could help.


We always think an email address of This email address is being protected from spambots. You need JavaScript enabled to view it. etc looks better than @btinternet, @gmail etc. Luckily, you can get these ‘domain registrations’ and emails from very low cost, such as Google Suite at around £3 a month.


In terms of social media, all these can normally be set up for free. You can even manage them with some automation, with tools such as Hootsuite. ‘Social selling’ is all the rage, for good reasons.


11. How do I pay myself?


Arguably the most important bit, as if you aren’t looking to pay yourself, why are you thinking about starting a business?!


If you are a self employed sole trader, it is as simple as drawing money from your account. Our advice would always be to plan for future tax by saving a percentage of the money you draw, or leaving enough in the account for later. As a rough figure, around 25% would be a reasonable provision. Without getting into tax too heavily, if you make a healthy profit in the first year you can have a higher tax figure to pay that year than subsequent years, due to the way self employed sole traders pay tax.


If you are a limited company, you need to figure out HOW you will pay yourself. You may have heard the term ‘salary’ or ‘dividend’. Both are ways of paying yourself, and often the most efficient thing is a mix of the two. Both require legal paperwork and/or reports to be submitted to HMRC to make them official.


This is one of the biggest benefits of having a reliable and experienced accountant on your team, as this is where some serious money can be saved if you are being paid from a limited company.


From your point of view, you will still just be transferring money to your personal account, but if the paperwork isn’t there, that money will be owed back to the company.


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If you are thinking of starting a business and would like to chat any of these points through, please call or email us and we will book you in at our office to meet with one of the team.


As an added bonus, we make a great tea or coffee…



Call us: 02392 240040


Email us: This email address is being protected from spambots. You need JavaScript enabled to view it.


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What if I can't pay my tax bill?

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What if I can't pay my tax?

 

 

 

 

 

 

 

 

 

That is a good question, one we do get asked a lot this time of year. Firstly, lets look at the financial issues with not paying tax on time (what it will cost you). We will then take a look at who to call.

 

There is a TL;DR (Too Long; Didn’t Read) summary below for those who don’t like numbers or are short on time.

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Unit 1, Byngs Business Park
Soake Road, Denmead
Waterlooville. Hampshire
PO7 6QX

 

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