Many SMEs do not have access to high-quality financial advice

Tuesday 1 September 2015

A new survey from IGF Invoice Finance has revealed that a third of small to medium-sized enterprises (SMEs) in the UK are fully dependent on internet search engines and social media for financial advice.

Worryingly, an accountant is only a slightly more popular choice when it comes to managing a company’s finances. A total of 34 per cent of those surveyed said their accountant was their first port of call for advice on business decisions.

IGF Invoice Finance’s managing director Tracey Ewen told the Independent: "Without advice, SMEs simply cannot make an informed decisions, and in business an uninformed decision is often a wrong decision.”

“No two businesses are the same, so using tactics or applying advice that has worked for another company does not mean it will work for you.”

While there is often useful financial advice to be found on the internet, anyone using it as their sole source of information is at risk of applying outdated or inaccurate approaches to their finances, with potentially disastrous results.

Furthermore, there are numerous advantages that can come from using the services of a specialist contractor accountant. For example, an expert can help you run your finances as effectively as possible, while avoiding the risk of falling foul of the taxman.

This is a frequent worry for those who try to navigate the process of becoming tax-compliant without assistance, particularly when HM Revenue and Customs (HMRC) update their regulations or introduce new ones.

The advice that is on offer from an accountant can be relied upon as up-to-date, as well as personalised to reflect an individual’s needs and stage of business development, as well as the economic conditions of their industry.

They can also help when it comes to deciding how to structure the way that you work as an SME, whether you prefer the control and freedom of being a sole trader, the ease and speed of becoming an umbrella company employee, or you choose to set up your own limited company and enjoy the financial benefits.

Contractor accountants can integrate other essential products such as public liability insurance and legal services into their financial packages, meaning that you can deal with a number of key business needs through one company.

The very fact that they are specialised is also a major advantage, as they are able to offer insights into specific contractor industries such as healthcare or IT, thanks to their extensive experience in these areas. The number of idiosyncrasies that spring up in any given industry means that this knowledge can be invaluable, particularly to freelancers who are in the process of getting started.

By Victoria McDonnell

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