Edmonton CPA | Should Entrepreneurs Talk To Accountants First
Starting a brand-new business is an extremely exciting time for many entrepreneurs, however, it can also be a confusing one says Edmonton CPA. Knowing what they need to do as their first steps, and how to accomplish all of the tasks that they need can be an overwhelming job for most people. Therefore, if business owners know who they should talk to first in order to find out what steps they need to take they can significantly help themselves figure out what they need to do and how they need to do it in order to start their business off on the right foot.
Edmonton and CPA recommend that talking to an accountant is a great place to start. One of the best reasons is because accountants typically do not charge for their initial consultation, so a business owner does not have to pay any money in order to get all of the advice they need on what they need to do first. They should come to the first meeting armed with all of the questions that they have, and ready to hear what they need to do.
One of the most important reasons that entrepreneurs should talk to an Edmonton CPA as their first step, is because figuring out there tax planning needs to happen before many other steps. An accountant will be able to ask questions about not only the business but who is going to be the owners of the business, what their personal circumstances are, and how they are planning on making their money and paying their staff. All of those variables are extremely important for an accountant to know so that they can create the best tax plan possible. Since many entrepreneurs want to become business owners in order to minimize their tax payments, they should start with this in mind.
Many entrepreneurs think that talking to their lawyer is a good place to start, however lawyers are not going to help entrepreneurs figure out tax planning, and so good lawyers will often suggest business owners go to their accountant first. Once accountants is figured out the most efficient tax plan, they can incorporate the business. The reason why this needs to happen before the incorporation, is because the tax plan needs to be written into the articles of incorporation. If it is done in the wrong order, a business owner could end up with a corporation that has an inefficient tax strategy.
By knowing the right ways to this go about starting their first business, entrepreneurs can ensure that they are setting up their business to minimize taxes. This is extremely important says Edmonton CPA, because not only can tax savings help entrepreneurs, but it can also help their business avoid running out of money. Running out of money is a reason why 29% of failed entrepreneurs say their business failed. Having an efficient tax strategy from the very beginning can help entrepreneurs save the most amount of money personally, and in their business so that they can be sure that their business is set up to succeed.
Starting a brand-new business in is an extremely exciting time for entrepreneurs says Edmonton CPA. They may get so excited that they try to save themselves time and money by starting the process before talking to their accountant. While that may feel like they are being efficient, what happens if entrepreneurs set things up for their business before talking to their accountant?
If an entrepreneur decides to set up their bank account for talking to their Edmonton CPA, they may end up setting their bank account up in the wrong name. This is especially true if the accountant suggests to the entrepreneur that they incorporate. It may be impossible for entrepreneurs to change the name on the business account especially if it is incorporated. Therefore, business owners might end up wasting time rather than saving it in order to have to try to switch names, before being forced to shut the account down and open a new one. There might be fees involved, and while it is not a huge time waste or money waste, it is just an example of one way that it is not efficient to set up things before talking to an accountant.
Entrepreneurs also believe that they can save themselves time and money by setting up their corporation ahead of time as well. Edmonton and CPA says that this is an even worse idea because while they think they are saving money, they actually do not understand that the tax structure that they are going to be using for the life of their business actually needs to be written directly into the articles of incorporation by their accountant. Therefore, if they create their corporation ahead of time, they may actually have written into their corporation and inefficient tax strategy. The leather have to use that strategy, or shut the corporation down and pay to start a new one. Wasting time and wasting money is not a great way to start off business ownership.
Once a business owner has talk to their Edmonton CPA and figured out the best tax structure, and business structure, the next thing that they should look for in an accountant is one who is going to be able to help them create a business plan. As important as this is, business owners should be advised that not all accountants offer this service. In fact, it is a less commonly offered service then tax planning and year-end financials. Therefore, it is important that entrepreneurs start off by looking for chartered professional accountants who do business planning, so that they can ensure that not only are they hiring a professional who is going to be able to help them tax plan, and do the incorporation of their business, will also be able to help them set their business up for success from the very beginning.