This is the first person every small business should hire

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Your business needs a financial management hero.

Main points

• There are many steps involved in setting up a business.
• An accountant can help you every step of the way, from setting up your business structure to paying your taxes and beyond.

If you’re dreaming of starting your own small business in 2023, you’re likely considering everything you need to do to set yourself up for success. Ideally, this means writing a solid business plan, factoring in your start-up costs, perhaps applying for a small business credit card, and figuring out whether you’ll need to lease or buy. space for your new venture. Among all these questions to answer and aspects to consider, here’s one you should really think about: hiring an accountant.

It takes time for a small business to grow and start making real money, so you may be asking yourself, “Why should I start paying someone other than myself right away?” Small business accounting involves many steps, and having an accountant in your corner from the start can save you a lot of time, potential headaches, and tax liabilities. That is why.

What is an accountant?

Accountants wear many hats. After all, an accountant is a professional who maintains and oversees financial records. “Librarian” is another term you’ve probably heard in connection with small business finance; the terms are sometimes used interchangeably, but they are not the same thing.

Bookkeepers do some of the same tasks, but usually do not have the same level of education as an accountant and are focused more on recording financial transactions, rather than interpreting them. In short, an accountant may be an accountant, but an accountant is not necessarily an accountant. Another term you may hear is certified public accountant, or CPA. This is an accountant who has passed a CPA exam and met state licensing requirements.

For the purposes of your small business, this type of professional will help you manage your day-to-day expenses, create documents so you can track the progress and financial health of your business, and oversee tax filing for making sure you’re paying the right amount and getting all the deductions you’re owed.

How can an accountant help you from the start?

The reason it’s worth getting an accountant on board once you’ve decided to start your business is that they can really help you every step of the way. One of the first things you need to decide is how to structure your business. An accountant will know the legal and tax obligations involved in starting, say, a limited liability company (LLC) versus an S corporation, and can help you choose.

An accountant can also set up your business finances for future success by advising you on what accounting software to buy. They can ensure that your financial procedures comply with government regulations. Remember, you definitely don’t want to be audited! And they can help you get off on the right foot with business banking and learn how to keep your personal and business expenses separate.

Laying the right financial foundations with the help of an accountant can make things much easier for you if your business takes off and you find yourself in the happy circumstances of expansion, hiring employees and more.

Remember, you don’t need to hire a full-time accountant right out of the gate—you can find one you consult regularly and pay as a contractor. If you know other small business owners in your area or line of work, ask around and see if any of them can recommend a good accountant. Hiring one will be time and money well spent to get your small business in the best possible shape for growth and success.