For small business owners, quarterly payments may be seen as a painful, joyless endeavor. While many individuals have the opportunity to pay their personal taxes on April 15 and then relax until the next year, business owners aren’t provided the same luxury.
With that being said, there are several reasons why small business owners should view quarterly tax payments as a blessing in disguise. Peter Karpas, CEO of accounting-software company Xero, points out that with “proper planning and the right financial tools, many business owners can approach each filing with confidence.”
Keeping financial records in line allow an individual to be able to effectively track any issues with their small business. Karpas notes that the biggest mistake small business owners make is not keeping their financial records up to date. “This is the number-one mistake small-business owners make and also the most important to remedy,” said Karpas. “No one wants to pour over accounts payable, receivables and cashflow at the end of a long day, which is why this important part of the business is often overlooked”
Karpas is not alone in his assessment. Amrik Randhawa, a product guy at Kashoo, concedes that “perfection in accounting is pretty much a myth…[but] you simply must keep accurate accounting records…When you come across an accounting error, make it right. Avoid the festering and the downward spiral that can follow.”
Keeping clear accounting records of a small business’ finances also allows a small business owner to accurately assess how to expand their business, as well as determine whether or not money invested in a certain aspect of the business is yielding an actual profit. Mike Templeman, CEO of Foxtail Marketing mentioned another business owner when discussing the importance of keeping clear records of a business’ finances. “Leavitt [another business owner] had made assumptions…and came to conclusions as to which of their services and products were the most popular,” wrote Templeman. “But after really examining the numbers, he realized popularity and revenues didn’t equate to profits…He had mistakenly assumed that revenues were leading to profits and was putting resources towards services that were breaking even, or worse, losing money.”
The bottom line then for small business owners is simple: keep clear, accurate records for the sake of yourself, your quarterly tax payments, and your business. And for the small business owners that want to expand or cover debts and need much-needed capital or a cash flow in the midst of tax-season, look no further than Overnite Capital. Overnite Capital supports various sectors, including and handles factoring lines of credit from $100,000 to $5 million.
Let us help you fund the research needed for your business. For more information, please call us today or message us via the Contact Us tab.