Accounting Software for Small Business

Archive for June, 2010

Effective phone handling processes help to ensure a company has a professional image. The productivity of an office can be significantly increased by utilizing effective procedures for managing telephone calls. Using small business PBX systems for incoming and outgoing calls requires an effective process in order to avoid problems such as losing important calls and transferring telephone calls to the wrong person.

Let’s take a look at ways to improve the handling of incoming and outgoing business calls and how SMBs are using small business PBX systems to portray a more professional, seamless client experience.

Managing Incoming Call Volume

The typical small business often spends a great deal more time than they realize attempting to answer calls, return calls, transfer calls, check messages, etc. Without the help of intuitive small business PBX systems, employees often try to juggle the process by keeping notes regarding the times of day the people they frequently call are available, writing paper notes or sending emails to return calls, or asking the caller to hang up and try their party’s direct line.

Not only does the process feel ‘choppy’ to the client, but also trying to juggle the call load can become quite confusing! Even if employees and associates set regular phone hours, they are often on other calls or away from their desks throughout the day. Advanced small business PBX systems include software that allows a receptionist to see on a computer screen whether or not a line is busy. The receptionist can then ask the caller if he or she would like to hold or be transferred to voice mail.

If a caller does leave a message, some of the more advanced small business PBX systems will even send the recipient and email with an audio file attached that can be opened and listened to online. Busy executives often don’t have the time to call in and check voicemail. Opening an audio file from email is not only fast, but the email itself becomes a ‘to do’ item that must be handled like other emails.

Ensuring Consistency on Outgoing Calls

Since phone and email are the primary ways in which most small businesses interact with their customers, having a process that looks and feels professional is critical. One of the first things to consider when making outgoing calls is the caller ID message.

Just about everyone has caller ID now. Home based businesses making calls from home office often use their home phone service to make calls. Consider the way these calls appear when they reach the customer. Do you want them to see your name, or your company’s name? If you prefer that your company name appear on caller ID, it’s a good idea to open another phone line in your business name.

However, many small businesses today rely on remote employees to interface with clients. Though you may have a business line with your company’s name on caller ID in your home, remote employees won’t. When a client receives calls from numerous different caller IDs, it can give the impression of a somewhat disjointed operation.

One way to solve this problem is by using small business PBX systems that can be set up in multiple locations, but are tied to a single account. This way, a remote employee in New York who is 3,000 miles away from your California office can have a small business PBX phone systems unit placed in his or her home that makes calls through your network. When the call is made, the caller ID will show your company name. From the client’s perspective any calls received using small business PBX systems in your network may as well be coming from a single location.

A More Professional Look Sets You Apart From the Competition

Most small business owners don’t realize how affordable high quality small business PBX phone systems can be – and that’s great news for the growing business. Many of your competitors may be portraying an unprofessional image simply because they don’t realize how easy it is to do so.

Small businesses can incorporate small business PBX systems starting at around $1000. Though this may have a higher up-front cost than just opening a business phone line, you’ll save money for years to come by choosing small business PBX systems that utilize VOIP technology that virtually eliminate costly phone company fees and long distance charges.

To improve productivity in the office and create a professional business image, utilizing best practices while handling telephone calls for large corporations and companies with small business PBX systems is vital.

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This article is based on the assumptions that 1) You are a small business owner or self-employed person (including home-based and part-time business owners) and 2) You don’t like to pay taxes. In fact, whenever you think about paying taxes, you get so mad you end up all worked up with nowhere to go.

Now, if paying taxes makes you so upset, what have you done about it lately? Why was your tax bill so high last year?

You paid too much tax last year (and the year before that, and the year before that . . .) because you have probably been an innocent victim of many popular myths about taxes.

Here they are. Get rid of them or you’ll be stuck paying too much tax forever.

Tax Myth #1: “I don’t make enough money to worry about reducing my taxes.”

Nothing could be further from the truth. People at all levels of income can pay less tax.

Tax reduction strategies are not just for the rich and famous. No matter how much money you make, you can pay less tax than you currently pay.

In fact, if your business has a loss, you can use that loss to offset other sources of income, such as wages from a regular job, your spouse’s wages, investment income, rental income, and other business income.

And if your business loss is so great that it more than offsets all your other income, you can take advantage of a special rule that lets you: a) Carry back that excess loss to the two prior years, thereby entitling you to a refund of taxes you already paid for either (or both) of those two prior years; and/or b) Carry forward that excess loss to the next 20 future years, so that any income you earn in the future will be reduced by that excess loss.

Tax Myth #2: “Tax reduction strategies are too complicated for me to use.”

Again, hogwash. There are plenty of ways for you, the average American, to lower your taxes.

Tax reduction is not just for the wealthy who pay high-priced attorneys to finagle their way out of paying taxes with sophisticated tax-avoidance schemes, like off-shore trusts and foreign bank accounts.

The average small business owner has plenty of tax reduction strategies at his/her disposal. You just have to know what they are and how to use them.

Tax Myth #3: “I had my return prepared by an accountant, so I know I paid the right amount of taxes.”

There are thousands of excellent, hard-working accountants doing a great job. And if you use a tax professional, maybe he/she has done everything possible to reduce your taxes to the legal minimum.

Based on my own experience, however, I’m convinced that many taxpayers who use professional tax preparers are overpaying their taxes, sometimes by thousands of dollars each year.

Why is that? Well, there are many reasons. The most obvious one is this: Many professional tax preparers are just that: tax preparers and tax preparers only.

A good tax accountant may know how to prepare a tax return in his/her sleep. He knows the forms backwards and forwards. He knows what numbers go on which form perfectly.

But that’s it. That’s all he/she knows.

A good tax preparer is not necessarily knowledgeable in tax reduction strategies. There’s a big difference between a good tax preparer and a savvy tax reduction specialist.

When you look for a good accountant, make sure you find one who doesn’t just “do the returns”, send out a bill and say “Next, please.”

Tax Myth #4: “My tax situation is OK because my BLANK (fill in the blank with a family member or other good friend) takes care of my taxes.”

There are various versions of this myth. Do any of these sound familiar?

“My brother-in-law takes care of my taxes.” “My uncle takes care of my taxes.” “My college buddy takes care of my taxes.”

And of course, the same problem exists with Myth #4 as Myth #3. Even when someone you know and trust does your returns, how do you know that this person is a good tax reduction specialist?

And often, many of these family members or “buddies” are not even professional tax preparers. This person just happens to be “The Family Accountant.” Just like every family has one person who knows a lot about cars (or mutual funds, or carpet cleaning, or whatever), many families have someone who “knows enough to be dangerous” with regard to taxes.

And even if your “Family Accountant” is a professional tax preparer, he’s probably not charging you for the return. He’s doing you a favor. He prepares your return; you change his oil.

My first reaction to this kind of situation (when someone is getting his/her return prepared for free) is this: You get what you pay for. When a family member does your return for free, how much attention can he give to your need for tax reduction strategies? Probably very little.

Tax Myth #5: “My tax situation is OK because I prepare my own returns.”

If this statement applies to you, then perhaps you are a “do-it-yourself-er”. Money is tight and you are used to doing things yourself anyway, so why not save a few bucks each year and do your own returns?

So you’ve spend countless hours over the years pouring over the forms and instructions, trying to figure out how to do the returns. And you’ve done OK. No letters from the IRS, no audits. Hey, pat yourself on the back!

And now that tax preparation software is so readily available and affordable, doing your own return is a breeze. Just key in a few numbers here and there, push the print button, and presto, you’ve got your return done in record time. And now you can even e-file your return with your own computer.

Have you ever heard of the book, “The Millionaire Next Door” (by Thomas J. Stanley and William D. Danko)?

This book describes the common characteristics of millionaires in our country. My favorite millionaire characteristic is this:

Millionaires become millionaires by minimizing their taxes and getting their tax & other financial affairs in order.

Now comes the Million Dollar Question: How do you think millionaires get their tax affairs in order? By doing their own tax returns? Of course not. Millionaires don’t prepare their own tax returns. They have more productive things to do with their time.

Instead, what millionaires do is spend time and money each year on tax planning and tax reduction strategies, not figuring out what number goes on which line of Form XYZ.

So my challenge to you is this: What are you going to do this year to reduce your taxable income?

Are you a believer in any of these myths? Now’s the time to get rid of them, once and for all. Your financial well-being depends on it.

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Get the right small business bookkeeping software and you will save time, money and stress. Now up to a point a manual bookkeeping system is all you need. One good manual system is the Dome Simplified Monthly Bookkeeping Record. You can pick this up at Office Depot or Office Max. That will even work OK with a couple of employees. But if you’re ready to step up to a computer system, you face a flood of products to pick from. Following are 7 tips to help you choose the best bookkeeping system for your small business.

Tip 1: Decide what you want.

If you’re upgrading from a manual system or switching from a bookkeeping service, there must be a reason. Decide what you want from a bookkeeping system and you’re more likely to get what you need. The best system should save you money.

Tip 2: Free might work.

A free system might work. Microsoft offers a free version that’s limited, but may be good enough. Usually if you have any employees a free system isn’t for you. But if you don’t have employees, consider the Microsoft free option.

Tip 3: Simple will work.

Buy more system than you need and you’ll pay hidden costs. Learning any system and using it is part of the continuing cost of software. An overly complex system will cost you as long as you try to use it. Simple is good if that’s what you need.

Tip 4: Software in a box.

Look at the major accounting software suppliers like QuickBooks and Peachtree. They sell software in huge volumes and there are thousands of users who have gone before you. No need to be a pioneer.

Tip 5: Easy upgrades.

Cheap software may be a dead end. If you ever need to upgrade, is there an upgrade version or do you get to start all over with a new software vendor? Maybe you can’t even easily transfer your records to the new software. Oh my!

Tip 6: Online for less stress.

Online software may be an option. Especially for payroll, you can forget about keeping up with endless regulation changes and just let the software people worry about that. Lots of bookkeeping automation is available really cheap with online accounting software.

Tip 7: Who can you call?

What happens when you have problems? Who can you call? Software has been known to just lock up and there you are. So know who can help you if you get in trouble, because trouble will come with any software.

The right small business book keeping software makes running a business easier and less stressful. The problem in choosing the best software is you have so many choices. Think through what your real needs are before you buy anything. Pick overly complex software and you’ll pay too high a price in learning and using the programs. But on the other hand, buy too little system and you may find yourself stuck and forced to learn a whole new system. The good news is that you have several options from major companies that are already used by thousands. You can easily buy a proven product that will do the job.

Running a payroll for larger organisations with full time accounting staff is easy. Full time professionals are employed or the payroll function may be outsourced to a payroll bureau. For the small business the payroll task often falls to the proprietor demanding even more time to familiarise with current payroll legislation and a not insignificant amount of administration time that could be better spent making profits than number crunching. For small business organisations with five to ten employees calculating the income tax and national insurance contributions in producing the weekly payroll can easily take an hour or more each week. An hour that could be better spent earning profits or at the very least having an extra hour of free time each week. Free time that small business owner’s value at a premium since the majority of small business owners either work or think about work from dawn to dusk 7 days a week. A payroll software package to satisfy the PAYE requirements can be just one part of making that small business more efficient.

Small businesses that fail to operate a sound payroll system can produce a negative effect on the employees. Employees expect to be paid and provided the amount is a competitive rate would only rarely have an effect on staff relations. However operating a payroll system that does not provide each employee with a payslip is like telling your employee he has received a personal letter that was opened for him and discarded as not important. To the employee a payslip is very important. Every employer has a legal responsibility to provide employees with payslips and a P60 End of Year Employees Certificate. A payroll software solution satisfies employee’s essential needs and fulfills the legal requirements. Failure to provide employees with payslips can only reduce the respect hat employee has for his employer. Every employee must receive a payslip that shows the amount of income tax and national insurance deducted from the gross pay. Employers must also calculate the employer’s national insurance contribution. Employers not using a payroll software package such as available from DIY Accounting Payroll Software must design their own payslip to give to employees to satisfy legal requirements.

Running a PAYE system and operating a payroll in the UK can be a burdensome task to comply with all the relevant legislation. Employers operating a PAYE system without the use of payroll software need to be familiar with evolving requirements of HMCE through their website and the extensive payroll notes contained on the CD-Rom which is sent out annually. To fully appreciate all the technicalities and complete all the correct documents such as the P11 Deductions Working sheet is time consuming. It doesn’t have to be a problem. Payroll Software can automate this knowledge and functions and is available at insignificant cost. DIY Accounting Payroll Software package is available for up to 20 employees at a cost of £15 to £25. That is a payroll software package that could save a small business over an hour a week, for twenty employees more like two hours, for less than 50p per week. All small business owners should at least consider suitable efficient payroll software.

Many payroll software packages are written using databases and can put many small business owners off using them due to both the cost and the fear of the unknown complexity of using such a payroll package. Many payroll software packages written on a database provide an excellent solution but have a tendency to be extremely politically correct and cover all potential rules and regulations and consequently become more complex to operate as they can demand at least a minimum knowledge of the payroll system. There are other PAYE solutions. The DIY Accounting Payroll Software is written on excel spreadsheets requiring no payroll experience and a minimum of entries to produce all the essential calculations of income tax and employees and employers national insurance. In addition excel copies of the time consuming P11 Deductions working sheet, P60 Employees Certificate and the P35 Annual Employers Return are all automated to save the small business valuable administration time. A payroll software solution written on excel can also be used with an open office spreadsheet package but not least all the entries are visible and therefore transparent. Errors and mistakes can be easily corrected simply by changing the numbers on the payroll ensuring the payroll is produced both quickly and accurately. Payroll Software is an effective tool that should receive serious consideration by all small business proprietors.

Payroll Software also has the advantage because it can be simple and fast to use of avoiding late payments to the revenue and the consequent unwanted letters and potential fines this can invoke. By having all the information required for the monthly or quarterly revenue payments late penalties can be avoided and by producing the Annual Employers return on time small business owners can submit their returns online and receive a tax free online filing bonus. The current online foiling bonus being £150 and substantially more than the payroll software might have cost. And it’s Tax Free. As they say in Yorkshire. “If thar you ever gets owt for nowt, Tec it”

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