Intelligent financial management for business with authorities

The article was written in collaboration with YPAY

Managing the finances of a business is no easy task. Many business leaders who create a business mainly take into account the professional, commercial and marketing aspect and less the managerial-financial aspect. Little by little, they are exposed to different concepts that they did not necessarily know, at least not in depth, very important and essential topics, such as those that will make the difference between a positive cash flow (yes, another concept that a business manager does not always know at the start of his career) and negative cash flow.

It is important to know the duties and rights, the things that must be observed and implemented as a business manager in front of authorities, customers or suppliers. It’s even more important to know how to make it easier for yourself, and today, when everything is online, there are different ways to do that.

The definition of business: a question to consider

When a person starts a business, one of the questions to be decided regarding relations with the authorities is its definition. Most of the time, the definition of the business as a limited company will be completed once the business has grown and established itself. There are advantages to defining it as a limited company from a legal point of view. A limited liability company is considered a legal entity in its own right, meaning that in the event of a lawsuit, it will not be against the owner but against the company itself.

Of course, the owners of the company are responsible for what happens, but they are not personally sued. Along with this, there are also disadvantages such as different procedures and payments that exist when a business becomes a corporation. Therefore, a business will often become a business at later stages, if at all. Regarding the other two options for defining the business, there is not always a choice. There are situations in which from the outset, regardless of the revenue cycle of the business, the business owner will be defined as a licensed trader, mainly in liberal professions such as lawyers, architects, journalists , etc.

When there is a choice, you need to consider the pros and cons of each. If there is an election as an exempt reseller, you may receive reimbursement for expenses via input VAT, but you will be obliged to submit and pay such a report every month or two. As an exempt reseller you will be exempt from this declaration, but you will also not be able to declare input VAT and receive a VAT refund.

What do the bureaucratic procedures with the Tax Administration and National Insurance include?

The first action that a person interested in creating a business must do is to open an independent file with the tax authorities: for income tax and VAT. In addition, he must also open an independent file with the National Insurance, which means paying the National Insurance every month independently, when the payment to the National Insurance is determined based on turnover. Income declared as part of the annual income tax return. Opening the income tax file is the first and most basic action.

When opening the VAT file, this is the time to determine whether you are an exempt or approved business, although, as mentioned, the choice is not always in your hands. Once the business is already open and you have entered into regular activity, these and other reports become part of the routine. On a regular basis you have to carry out book management, whereas today, of course, everything is done in a computerized and online environment, and there are also services that offer everything under one roof (more precisely: One cloud…), notably account management.

In order to meet IRS reporting requirements, you need to manage things in an orderly manner: Income and receipts versus expenses. As mentioned, one of the most important reports is the annual report, Form 1301 for Self-Employed, in which you must detail your income, from the current income cycle following business activity to passive income such as training funds, welfare and pension. funds for the self-employed, and more.

As an authorized reseller, a report that you will need to submit much more often is a monthly or bi-weekly VAT report in which you will indicate the total amount of transactions subject to VAT, as well as expenses subject to VAT and compensation will be made . done between the two. “H. It is important to submit your request on time so as not to receive payment charges simply for being late, even by a few days.

Make running your business easier: here’s how you’ll do it

Many business owners are convinced early in their journey that dealing with financial and bureaucratic matters is marginal to running the business from a professional and marketing perspective. Little by little, they realize that things are not always like this and that they must behave correctly and wisely. They are therefore faced with a dilemma: should they hire an employee who will be responsible for financial matters, or should they outsource this task? Are there complex issues that are expected to be handled by an accountant and are there things that can be done independently? Today there are ways to help you manage your business more easily.

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A great way to do this is to use an app that will first give you the basics: The ability to issue a green invoice digitally very easily, whether it’s just a receipt, a tax invoice , an invoice/tax receipt and also shipping certificates. There are apps that offer a whole set of free services, including a simple platform for customer management, reporting to authorities and much more, as well as basic paid services such as collection clearing services payments, declaration of capital, issuance of an annual report.

There are applications that also offer complete accounting services, issuing payslips and everything else that is necessary for a business. All documents are stored securely in the cloud without having to worry about space on the computer.

YPAY was created with the aim of helping business owners manage their financial affairs conveniently through a unique system that provides a wide range of services, ranging from daily services such as issuing invoices and managing from customers provided for free to advanced paid services. such as payslips, a compensation system, production of reports for authorities and much more. You are welcome to contact us via email [email protected]

The article was written in collaboration with YPAY

The definition of business: a question to consider

What do the bureaucratic procedures with the Tax Administration and National Insurance include?

Make running your business easier: here’s how you’ll do it

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