There's been lots of noise over the last few years about Accountancy Software! The TV adverts tell you that you can "complete your tax return in just one click", that this will super-power your business and allow you to "get stuff done" and with MTD coming in in 2024 for Self-Assessment it should be at the top of every small business owner's thoughts but what does all this really mean?
We spoke to our Director and Accountant Bryony Smith to find out.
Accountancy Software can be really useful for some businesses. With the ability to quote for a job, see your price list in front of you, turn the quote into a proposal and then an invoice to match to the income in your bank can be a great way to save admin time in your business. Software can also give you the opportunity to monitor stock levels, automate some of your systems and keep an eye on your finances throughout the year. You can even track your mileage and complete your payroll on the same system. However, all of this comes at a cost.
To use Software to its full potential, you need someone who has a really good understanding of all of its features and the time to sit and update it, monitor its automations and ensure the information is correct. The "Tax Return in One Click" is rarely a possibility in practice and we must remember the responsibility of the Small Business Owner to ensure accuracy of their accounts. Bank rules on Software mean your transactions will be automatically categorised within your Profit and Loss and Balance Sheet but it isn't a fool-proof system and without proper checking, these automations can leave you with a higher tax bill or penalties should they be investigated. Software is absolutely imperative to the smooth running of the Accounts of your business but cannot replace the expertise of an experienced and qualified Accountant in these situations.
To maximise the usefulness of your Accountancy Software we would recommend taking the following actions:
1) Take time to do your research and consider which accountancy software is right for you.
2) Book in for a training session with a certified and licensed advisor to learn the features and how to use your software.
3) Put time aside each week or month to ensure your accounts are kept up to date and don't become overwhelming.
4) Create your own banking rules and check through any automatically categorised transactions to ensure they are correct.
5) Use a check and file service with your accountancy firm to ensure your accounts are submitted correctly.
For any further information, head to our Book Online Page to schedule a chat with our certified advisor.
Photo: Burton Photography