Research from FreeAgent says that apparently 11% of people currently in employment intend to start their own business in 2018.
Put simply that’s an awful lot of people who are going to hit the taxation system full on having been sheltered by the lee of a paye system that on the whole works quite well.
Now we don’t know what types of business these new start ups are looking to establish whether a supply of services built around their own capabilities or maybe a tech start up or a retail business.
What is certain is that they probably have no notion whatsoever about how to structure their business, how to maintain records, how to interpret the records let alone how they will be taxed and when they will have to actually pay whatever tax they owe.
As Accountants we are probably the first port of call for many such people as they contemplate their journey. Now many accountants believe that start ups can be time consuming, inquisitive about virtually everything they encounter and frankly fee adverse looking for a cheaper option and as such not for them.
But equally many do recognise that these new entrepreneurs recognise and appreciate openness and help when it is provided and if they are happy with the service remain with their chosen Accountant for many years.
Self-employed service providers may well be the lowest fee generator but if set up correctly with systems built around their abilities and sector they will after the first year require little maintenance and as very little in their self-employment changes making them a good contributor to our bottom line profits.
Of course some start ups are genuinely entrepreneurial in their outlook and desire and present a whole lot of different options to us to help them develop and grow and the demands placed upon us tend to grow as their business develops. Now these clients provide income streams across the full range of services we can provide.
So far nothing new but if a practice gives out no signs whatsoever that they are interested in start ups if the website is silent on the issue of starting out as self-employed or starting a new business why would such a person go to them? Of course if you don’t want these clients fine but if you do then think about how you are going to attract them to your practice and remember there are apparently going to be an awful lot more of them in the coming months.
By Tony Margaritelli (ICPA Chairman)
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