This is the time when small business owners are checking their list of "must-do's" to get ready for a new year. Getting in shape for yearend tax filings and other fiscal responsibilities is the focus. So if you have questions about payroll, business planning for the new year, hiring, and more, this list will provide some of the important items to consider to ensure you end the year in compliance and ready to run full speed ahead in the new year.
1. Report compensation paid to officers and shareholders of your corporation.
Owner/Shareholders who perform services for their corporation are considered employees. If you have been making personal withdrawals from your business be sure to report this as wages before yearend. Here's the IRS' take on this topic, click here. Stay up to date on employment rules for Illinois by clicking here.
2. It's a good time to create or update employee/employer policies, company manuals, etc.
Making company manuals can help ensure your employment practices are in compliance with IRS regulations as it relates to hiring employees and contractors. Click here for more information on how to determine if someone you are hiring should be considered an employee or a contractor. This is one area, that if ignored, can get start-up owners in legal and financial trouble.
3. Update/create customer policies to reflect any changes you made in your business (i.e. pricing, policies and procedures, etc.).
If you plan to go into the new year with new payment policies or price increases, and any other changes that will impact how you do business with your customers, it is generally a good idea to have a clear concise method of communicating these changes upfront and in a professional manner. Having a written document reflecting such changes can make it easier for you and your staff to share this information easily with your customers.
4. Catch up on your bookkeeping if you have not been keeping your financial data in an orderly manner throughout the year.
Many start-ups find it difficult to keep up with recording their revenues and expenses into an accounting system, while also conducting the day to day operations of their business. However, having your financial data in an organized manner will greatly assist in the preparation of tax returns, financial statements, etc. that you will need to prepare in the next year. The benefits of good bookkeeping is explained further in our blog Secret to Solving your Cash Flow Problem.
5. Make sure to update your website and other digital platforms for any changes you make to your company policies that need to be communicated to your customers.
Having the same message available to your customers on all the varying levels you communicate with them is vital. Most would agree that it could be considered misleading if you are given one message online and another when you make physical contact with a company.
6. Get your staff updated on new changes in your industry and/or regulations that could be relevant to your business.
Allotting time for your staff to get updated on relevant changes in your industry can provide more uniformity in servicing your customers. It also creates more confident employees. "Happy employees means happy customers!"
7. Have a strategic talk with your CPA to discuss any new business ideas you're thinking of implementing in the new year.
Your CPA can be a great resource for finding out how your business plans will impact your taxes, revenues, and expenses. Having this insight will ensure you are making well informed business decisions.
Getting prepared for the new year, every year, is critical if you plan to successfully implement the necessary changes for growing your business. Being prepared and ahead of the curve can also help your business be the most prepared when seeking capital. Click the button below to learn how bankers "size up" your business when you're seeking a loan:
Check out a few other blogs that can help you in operating your business better:
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