Accounting Steps Your Start-up Business
The challenge of realizing ideas and taking the steps for business startup Bulgaria is exciting, but the process is long and requires consistency. Starting your own business is a daunting task. Entrepreneurs will need the proper planning and strategizing to get any business off the ground successfully.
This article looks at the initial accountancy related steps that any entrepreneur needs to take to thrive in the business world as an owner.
Plan Your Accounting Strategy for business startup Bulgaria
For a new business owner there will be so many demands on your time that staying focused on your accounting needs may be difficult.
It is best to plan an accounting strategy right from the beginning.
Selecting the Right Accountant
Do you need a bookkeeper or an accountant? The answer depends on your familiarity with accounting principles and the amount of time you have available – apart from the other demands of getting your new business off the ground.
- The right accountant for your business will be someone who:
- Understands your industry and has experience in it
- Likes working with entrepreneurs
- Communicates at a level that makes you comfortable and increases your confidence.
To further narrow down your candidates, it’s a good idea to create a list of the specific kinds of advice and services you will require.
- For example:
- Find and document your tax deductions
- Set up systems to track and manage cash flow and inventory
- Prepare successful loan applications, including auditing services when required
- Decide when you need to raise or lower your prices—and by how much
Determine How to Receive Payments
That means determining whether you’ll be accepting payments online, through a POS system, or in person.
- POS system and in-person payments
- POS payments only: For in-person payments, investigate either a POS system, which accepts transactions alongside a cash register or a standalone credit card reader, which is independent of any other system. For either option, you’ll need to open a merchant account with your bank.
- Online payments only: For transactions that only take place online
Open a Business Bank Account
Limited companies are required to keep their business finances separate from the personal accounts of their owners, while sole proprietors do not face such restrictions. But even though sole proprietors can legally co-mingle their personal and business expenses in the same account, we always advise against it.
- If it’s your first time setting up a business bank account, choose a bank that meets your needs:
- Does it have a local branch that’s easy to access in person and online?
- Does it work well with your POS system?
- Will it integrate easily with the apps and online services you’re using to manage your business’s finances?
Start off with two business accounts, one savings, one checking, and a business credit card.
Track Your Expenses
Many small business expenses are tax deductible, including certain startup Bulgaria business expenses. But to claim these deductions, you must keep records of everything you spend.
- Receipts
- Bank and credit card statements
- Bills
- Invoices
- Proof of payments
Set up a Payroll System
As your business grows, you may find yourself hiring contractors and employees.
Before you bring on any new team members, make sure you categorize them correctly as either employees or independent contractors.
Determine your Tax Obligations
These can include income taxes on pay, sales taxes such as VAT and annual corporation taxes. Ensure that you are familiar with your obligations in each area and how long you need to keep records.
Prepare Financial Statements
You should be printing a set of financial statements monthly or quarterly, depending on your business.
If you maintain month-end closing financial statements, your bank reconciliation should be included with the financial statements to make sure that your general ledger balance and bank balance match.
A company balance sheet showing assets, liabilities, and shareholders’ equity.