STARTING A BUSINESS
Starting a new business, whether it’s for the first time or a repeat, is always an interesting time.
STARTING A BUSINESS
You’ve pitched and won the contract, and now you’re thinking “How are we going to deliver?”
Your experience as a business owner or manager will enable you to solve many problems without help.
EXITING A BUSINESS
Most people only sell a business once, and the money raised is usually critical to their future.
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What sets the most successful companies apart from others? One of the key determining factors is the quality of it’s staff. It has been proven time and time again that a successful company not only has staff with an the array of skills, but also a high level of staff engagement .
By understanding what makes your key members of staff tick, you can transition the right people into the right position. Engaging every member of staff and driving your business forward.
In order to successfully sell to your customers, your business must thoroughly understand what the clients are thinking. It is proven that for every one negative client talking about your business, you will need eleven 100% positive clients.
If the KPIs don’t cover all of the things that matter to your business, they could be presenting only a partial picture – giving a false sense of security to the business and the business owners. This can be extremely damaging as it affects your chances of growth in the near future.
Strategy has a military history, going back at least to 600 b.c. with The Art of War by Sun Tzu, and as such has been mostly concerned with competitiveness. How to win a battle with your competitors has been the main stay of strategic literature for many year, with positioning of products (Strategic choice) aim to make the business better than the competition.
More recently, strategic tools are used in the creation of vision and mission statements. These have a number of uses: Firstly, to help sell the idea of the company to its investors and Secondly, the move to culture based management; where the organisation rely on its culture to inform the employees choices, enabling them to make the correct decisions at all levels without strict supervision
Not only does a strategy help engage and give direction, any company without a cohesive business strategy could drift away from its customers and become uncompetitive within its environment and eventually stops making profit.
It is important that you consider the type of business structure you will operate under carefully. Things to consider are:
The most beneficial structure for your business will depend on your circumstances. We can help you to ensure you future proof your business by selecting the right structure.
Generally entertainment consumed away from your work premises are 50% deductible. If you food and drink is consumed at your business premises because you or your staff are working late then this may be fully deductible.
If you travel out of town for work then generally 100% of your accommodation and food costs will be deductible. However if you pay for work relates guests then the expenditure is only 50% deductible.
For more detail refer to Inland Revenue’s IR268 booklet
If you are self-employed or a shareholder-employee then you can pay provisional tax during the year rather than PAYE. Generally provisional tax is paid in three equal instalments through the year.
By default the amount of provisional tax you will be required to pay is based on your previous year’s earnings plus 5%. However it is important that if you expect your income to increase by more than 5% you contact us to discuss this as you may be charged interest if you underpay your provisional tax.
Depending on the type of business structure you operate under and the level of income you earn you may be able to defer paying tax on the income from your first year of trading until the second year. However if this is the case it is important to budget for paying two years’ worth of tax in the second year.
We can help you determine when you need to start paying tax so that you are not penalised by Inland Revenue.
If you have made a depreciation claim on a business asset and you then sell the asset for more than its book value you will be required to pay tax on the profit. However the taxable portion of the profit is limited to the amount of depreciation claimed on the asset. The remainder of the profit is a tax free capital gain.
By paying yourself a wage from your business you will pay your tax as your go through PAYE. Some people prefer this as it reduces the amount of tax they have to pay at the end of the year.
Alternatively when drawings are taken throughout the year and then a shareholder salary is allocated at the end of the year when you know how your business has performed this provides flexibility and defers the tax payment.
Paying yourself a wage from your business also has implications on the type of ACC cover you are eligible for. We can ensure you make the correct choice for your circumstances
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