Outsourcing

Common GST Mistakes to Avoid

Common GST Mistakes to Avoid

Making mistakes is human and everyone does it. Yet making mistakes with your GST can end you up in hot water with both the IRD and your accountant or bookkeeper. Thankfully it is easy to stay out of trouble by being aware of what is expected of you and your business when it comes to GST. After all, prevention is far better than cure …

GST Mistakes Every Business Owner Needs to Avoid Making

There are five mistakes small businesses often make when it comes to their GST. They are:

  1. Registering for GST too late or too early.
    In NZ, a business is required to register for GST when they earn $60,000 or more per year. Some businesses choose to register early because their clients or customers are GST registered and this is a good idea. If your business sells mostly to the public though, registering early will see you having to pay more tax when you didn’t have to. If a business fails to register when they reach the earning threshold, they face financial penalties from the IRD.
  2. Incorrect figures and accountancy practices.
    It is easy to enter the wrong numbers or miss an invoice out when completing your GST return. However, you may end up paying penalties for this to the IRD – making having your GST return completed by us well worth the investment.
  3. Asset purchases are often mis-labelled.
    If you purchase an asset for your business but are going to use it for some personal use too, then this needs to be identified to the IRD. For instance, if your business buys a car, but you are still going to use it to take the kids to school, you will need to calculate the appropriate amount     of GST deduction for it.
  4. Including invoices and expenses in the wrong GST return.
    Once again, we are all human and mistakes do happen. But including an invoice within the wrong GST period, without identifying it as a late invoice, can see you paying unnecessary penalties.
  5. Not charging GST, especially if you are a low income earning business.
    Profit margins are slim at the best of times.  With competitive pricing essential to attract customers, our prices can become too low.  This means     you end up not charging enough to cover GST. If your turnover is low, unless you notify the IRD that you are de-registering, they will expect you to keep collecting and paying GST.

Our clever team of GST experts are here to help! Let us manage your GST returns, payments, invoicing and even your annual financial statements for you. We eat, sleep and breath numbers, letting you get on with doing all the things you love. Book your free consultation today and find out just how easy and affordable it is to outsource your financial jobs to us!

Xero and Sarah, Sarah Makes Her Business Bloom – Case Study


Sarah is having a hectic day.  She knows she must stay at work late tonight entering her orders and invoices for the last month to evaluate how her business is doing. Her bank balance seems a tad low. Despite best intentions, she’s behind with her accounts, again. She does not mind doing her accounts.  Honestly,  she would much rather focus on designing and creating stunning bouquets. Sarah owns Blooming Love, a floral and giftware shop in the Tannery, Christchurch.

Sarah needs to rise early tomorrow to get to the flower market and check the availability of hydrangeas for wedding bouquets on Saturday. Her days are getting longer, what with early starts and trying to catch up on accounts and orders in the evenings. Sarah popped into Lucy’s café yesterday and Lucy advised she has contracted a book keeping business, and mentioned how it’s lifted a load off her shoulders.

She calls Rebecca the bookkeeper at lunchtime.  Rebecca asks her questions about her business, and suggests Sarah emails through what she would like covered. Rebecca will review Sarah’s accounting needs and arrange a time later in the week to discuss pricing options for her bookkeeping needs. Rebecca advises Sarah that they should set up Xero, a cloud based accounting application.  This would allow them to work collaboratively on managing Sarah’s financial records online without frequent meetings to exchange paperwork.

Sarah thinks over Rebecca’s comments on Xero, the cloud based accounting application for her business. There are nifty applications she can download on her iPhone too, to tag business transactions to go to her Xero account.  That would be handy at the flower markets in early mornings when making payments for her purchases. Have her monthly bills like power and rent emailed straight into her Xero accounts pre-coded, ready to reconcile.  Plus, she will be able to clear all that paperwork over her desk at the shop, by saving documention to online files.

There were more useful features in Xero for Sarah to learn, but already she is thinking.  Maybe remove her paper cluttered desk.  Then extend her workbench for creating her flowers as she needs more room. Her slim laptop with accounts access, can be stored to the side easily.  Plus with this free time in the evenings, she could attend those Advanced Floral Art courses at the local polytechnic.  She also wants to add an online shop to her Website, too.

If You’re Passionate About Your Business……

If you’re as passionate about your business as Sarah is, and wish for time to upskill your knowledge or focus on other parts of your business – then why not outsource your book keeping to Do The Sums Book Keeping and More.  Use that free time to keep your passion alive on the more tasks focused on growing your business. Maybe expand your skills or investigate new products to add to your business.  Explore other sales opportunities.  

Tell us what you need done with your accounts, and share where you would like your business to go … and we’ll work to help you reach your goals. Send me an email today and we’ll talk soon: Rebecca@dothesums.co.nz

balance-in-the-books-and-balance-in-your-life

balance-in-the-books-and-balance-in-your-life

A good hearty laugh relieves physical tension, leaves your muscle relaxed for up to 45 mins after, and even boosts the immune system?   Do you remember the last time you enjoyed a good deep belly laugh with your family or friends?

One crucial thing many small business owners often overlook – is looking after themselves and balancing their lifestyles.  It’s so very easy to find your business gradually swallowing up all your free hours.  Doing everything in the business is demanding, you get stretched with needing to manage everything, especially if you’re a sole business owner – there isn’t anyone to share your load with.  You can’t afford to get sick or ill.   After all, who will run the business?  Growing demands begins to wear you down.  So what can we do to help create ‘balance’ in our lives, feel more in control, and make time to step away from our businesses to relax and have fun.

First – check your physical health and diet.

Being healthy does strengthen your mental ability to be able to manage stress.  Even a 40 min daily walk around the block with the dog helps.  It’s not about super long gym sessions to get a prime body – we’re talking about maintaining a good general fitness. Find some activity you enjoy doing – if it becomes boring – do it with a group or ask a friend to join in.  Try blending doing physical activities with your partner or family to gain more social and physical time – backyard soccer game anyone?

(Think – what’s the point of investing this time and money into the business now if you aren’t going to strive to be healthy enough in future years to enjoy possible financial benefits derived from all this hard work you’re putting into your business today?)

Monitor your business hours.

Finished work? Done enough today?  Close that laptop, and put down the cellphone and walk away. Go interact fully with the family and friends.  In your time away, if it’s crucial to check in, then be strict – check in once the late afternoon.  Avoid checking devices during late evenings – do you want to fall asleep with business on your mind? Create a friendly auto-answer messaging system on both your emails and business numbers to clients who call out of hours.  Schedule your breaks, and take them.   Sometimes it’s not possible to avoid after hour work because of the nature of your business, like a food business. But try scheduling two-three hour blocks of time in evenings for say two or three nights a week and then keep the other evenings free to give yourself a break away from work.

Work Smart on your business.

Review your goals on a regular basis.  In working so hard, we can forget to step away and check we’re on track or not.  How’s your income? Your current business systems – are there better way of doing this process now?  Spend so much time looking for and sorting paper invoices and writing outgoing orders?  Go paperless – move to an integrated accounting system and encourage suppliers and clients to order online.  Social media marketing … do you need to be on all of them – why not get selective and focus on two.  Streamline, and then review again later.

Outsource.

Eeeek – that means bringing in ‘outsiders’ into your business.  But when it grows, sometimes it’s just not possible to keep our fingers on all the pulses of the business. Multi-tasking doesn’t work if it’s spreading your energy thin all over the place – accounts, marketing and processing sales – and you can’t focus properly.  Contracting out some of your workloads, or hiring experts can reduce your time demands within the business.  Experts with their knowledge base can suggest fresh ideas and processes to help enhance your business.  Outsource what you aren’t good at or haven’t time to train on, and refocus your passion on what you do love doing best in your business!  So we’ll ask now – how are your accounts?  Do you understand where your money is coming from and where is it going?

Here at Do the Sums, we work hard to be updated on the best bookkeeping systems, keep abreast of tax compliance rules.  We’re always the lookout for cool system add-ons that can help minimise business processes and save time.  We can train you on bookkeeping systems, or you can hand it all over. Or just some.  By the way, we Network often – so if it’s not accounting – but something else you’re needing help with, feel free to ask me as we deal with a wide range of business professionals and may be able to recommend the right person.

So, there it is.  BALANCE.  Work on your business – but make your lifestyle balanced too, and create some time off to go relax and laugh .. with family or friends. 

GST Tax Returns     Annual Tax Returns    Tax Agents   

Bookkeeping Online   FBT Tax Returns   Payroll Processing

Friendly Personal Service at Do The Sums Bookkeeping and More – can we help you?

Rebecca on 027 379 0992 or email rebecca@dothesums.co.nz

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Its your time to shine

This is for you. My most valued client – yes you!

It's your time to shine

I love and respect that you knew you had reached the point in your business where you needed a little help. I love that you value and respect your business enough to find someone who loves the jobs you hate (I know you think it’s a little crazy to love doing the accounts – even if you wouldn’t say that to my face). I love and respect that you trusted me with the most intimate part of your business – the numbers and your bottom line.

I know that you have this great desire to have a successful business – its what keeps you going at 3am – but that you want to get back (or maintain) the balance in your life.. And that is why we are working together to make these desires a reality.

By teaming up with me you know your have taken the next step. You are ready to smash your goals and continue or the path to success. I’m here and ready to walk that path with you and to guide you along the way.

I am committed to being the cheer squad, the guide and even the STOP sign if needed so that together we can move your business to the next level. You are no longer alone – you have joined the team of amazing business owners within our community who have taken the next step to growing their business and taking back their lives.

Working together means you can now relax a little knowing that the books are taken care of. Your stress levels have dropped and you have dedicated the time you have freed up to the areas of your business and life that you LOVE most.

Passion Lead Us Here

You have moved from being stressed and flustered about finding the time to keep up to date with the accounts to cherishing the freedom you have knowing that we have everything under control. You are even starting to look forward to our meetings to hear about the numbers…. you even know how to read your profit & loss – and are excited to see your hard work reflected in the numbers.

We connect so well – pulled together by the joint desire to see your business grow and succeed. My valued client I believe you are well on your way to reaching your destination and with our combined strength all obstacles can be overcome.

So lets get down to it – and take that next step.

Rebecca

Outsourcing or Employing Staff – Which is best for my business?

Your business is booming, you are run off your feet and need some help. Perhaps you don’t have the specific skills or experience needed to fulfil an upcoming task? So the big decision comes down to do you hire a new part or full time employee or do you outsource the work instead? Which option is the best one for your business?

 

Pros and Cons of Employing Staff

Hiring staff for your business means that you know who is going to be turning up to work each day. You’ve met them, interviewed them and possibly even socialised with them. They may have some personality quirks, but you can live with those. They meet your needs for training, qualifications, experience and knowledge, so you know they can do the job for you.

However, you are responsible for their hourly pay or fixed salary, ACC costs, tax, holiday pay, annual leave, sick pay, Kiwi Saver contributions and that’s not even including the actual things they’ll need to do their job. Extra furniture, uniforms, computer, internet access, mobile phone, insurance and training are also added costs. The IRD have got a helpful guide which identifies what you need to be aware of when employing your first staff members too.

Outsourcing or Hiring Staff?

Hiring the right staff is key to your business continuing its success

Pros and Cons of Outsourcing Work

When you outsource work, you send a specific job to someone like a virtual assistant or graphic designer for them to do it for you. Jobs which you are better off paying someone to do so you can concentrate on more profitable ones, are the perfect ones to outsource.

The great thing about outsourcing your work is that your costs are automatically lower. Sure you have to pay for the work they do for you, but there are no training costs, no need to buy consumables or a new PC and no sick pay either!

On the down side, you are most probably never going to meet them in person, other than on Skype or via email. You’ll not be able to keep an eye on what they are actually doing when completing your tasks and neither will know exactly when they did or how long it took to do your work.

 

Should I Outsource or Hire Staff?

Choosing the right option can be hard

Each business is different and so the right option will be different in each situation. If you are unsure get in touch with an expert to help you make the best choice.

The answer as to hiring or outsourcing would depend on your business. Can it afford the extra costs of employing staff? Would the benefits they bring be worth the time and money they’ll expend? Are the jobs able to be done remotely or do they need to be done on site? Is it a repeating or just a one-time job?

Obviously the ultimate choice is yours, but I am more than happy to chat with you about your specific business and help you make the best choice for your circumstance. Give me a call or send me an email today and let’s keep your business booming!

What’s so good about Cloud Accounting?

What's So Good About Cloud Accounting?

  Cloud Accounting You Say? Like Xero?

So what makes Cloud accounting better than my standard desktop software package? It’s a real buzz in the business world right now this idea of the cloud, but what does it really give me that is so much better than what I use currently? Lets take a quick look at some of the benefits of using cloud accounting software? If you want to discuss your specific situation in more detail feel free to get in touch for a free 30 minute consultation.

The Cost Factor

With Cloud Accounting services, you subscribe and get access to a comprehensive accounting system at a fixed cost each month, on a pay as you go basis.  The providers do the work in managing the remote servers, doing software upgrades, provide storage and do security updates too. No need to outlay for annual software packages, constantly update it and add hardware for your office. In addition, when you’re on a tight budget, knowing your fixed monthly subscription costs is helpful for budget planning.

 

Take Your Office anywhere with the Internet

On the go all the time?   Easily take your ‘office’ with you when you are out and about – where there’s Internet, you can access your financial data from wherever you are from your laptop or mobile.  (Most Cloud Accounting Providers can offer you mobile applications.)   Great for balancing your work-life options – got to get home to collect your children, but still need to be accessible to accounting staff or client queries – the Cloud interface makes it happen so you can work from anywhere.

 

Collaboration

Teamwork – got several staff members needing to process accounting transactions?  Maybe at different locations.  Your staff buyer wants to know stock levels.  With cloud, your staff can login, access, edit and share documents on the same workface.  Cloud-based file sharing applications help them make updates in real time and allows them full visibility of their collaborations.  You and your team can both work online on the same document or webpage, no need to circulate documents back and forth showing corrections – members access and work on the same page, in real time.  (Quality Cloud Software applications have settings and security controls for Administrators to control each member’s access to your business data so you can restrict access to portals, like Payroll or bank accounts).

Accounting problems?   Your Book keeper or Accountant can login into your Accounting system from their office to fix or locate the problem – no need to go their office.

 

Back Up of Data and Loss of Devices

On manual systems, do you remember to back up your sensitive data each time to your servers often?  Cloud based applications offer safe and secure storage of your data on remote servers.  If your business burnt down, or child has knocked coffee all over your laptop or dropped your IPhone (ouch) – don’t panic – your data is still available on the cloud.  You’ll just have to access it from another replacement device.  (Remember to change your passwords for access to any cloud based applications on your device).

 

 

So if you are ready to take the leap into the Cloud – feel free to get in touch and we can help you get started on your journey.

 

 

 

 

 

 

 

 

Should I Become GST Registered?

To register or not to register?

Should I Become GST Registered?

That is the question and I have the answer: it depends on the circumstances of your business. While it’s true that some businesses absolutely must be GST registered, for others it is optional. But why would you choose to become GST registered if you don’t have to? Doesn’t it just mean you have to pay more tax? Let’s delve deeper and find out…

Do I Have to be GST Registered?

By law, the Inland Revenue Department says you must register within 21 days if you meet one of two reasons:

  1. You have a taxable activity and your turnover for the past 12 months was $60,000 or more, or will be $60,000 or more for the next 12 months.
  2. Your prices include GST.

So basically no, you do not have to be GST registered if your annual turnover is less than $60,000, including being a sole trader or starting up a company. But there are some advantages by becoming GST registered on a voluntary basis.

Why Should I Choose to be GST Registered?

Registering voluntarily to collect GST can be an absolute boon to some small businesses and traders, especially when they are just starting up. That’s because:

  • You can claim back the GST from the goods and services you brought from someone who is registered, which is great when you are starting up and have to buy everything!
  • You can claim back the GST from second hand goods you brought from someone who is not registered.
  • Doing regular GST Returns helps you keep your accounting up to date.
  • If you sell to other GST registered businesses, they will most probably want you to be registered too so they can claim the GST they’ve paid you.

But now hold your horses people! There are some disadvantages to registering which you need to weigh up too. You will have to:

  • Pay 15% of what you receive from selling your goods or services to the IRD.
  • Complete regular GST Returns.
  • Let the IRD know about all the GST you have received for your goods and services.
  • Pay GST back on any assets you keep when you deregister or cancel your GST registration.

How Do I Register for GST?

Regardless of whether you have your hand forced or you want to register voluntarily, the process for becoming GST registered is the same.

  • Get or find your IRD number
  • Choose the way you want to claim and pay GST – on receiving payment, on invoicing or on a hybrid basis
  • Decide on how frequently you want to do your GST returns – each month, two monthly or six monthly
  • Work out what your business description and code is
  • Register at myIR

I am always here to help you out and that includes with making the decision to become GST registered or not. So give me a call or send me an email and I can help weigh up all the pros and cons for you.

Building a Village around your baby, I mean Business!!

Outsourcing can be scary – like handing over your baby to a stranger

Believe me I know. You have worked so hard on your baby (I mean business), building it up from nothing. Getting branding right, a loyal following, customers. You’re it!! The one woman (man) band – the sales person, the accountant, the graphic designer, the content writer, the web developer (and lets not forget lackey)……. You crafted, shaped and raised your baby just like you wanted….. how could you trust anyone to love and care for your baby as much as you do?

My personal outsourcing experience - a bit like my baby

Is your business a little like one of your babies?

Trust me I felt exactly the same. I didn’t know if I could trust someone (a stranger no less) with my baby (I mean business). But at some point you realise that for your baby (business) to be the best it can be it needs an outside influence or two. I mean no-one is an expert at everything. Yes you can cover the basics but for your baby (business) to grow up and be successful they need more than basic, they need experts in their field to encourage them stretch and expand on those initial ideas you introduced.

So I took a Leap of faith…

That’s right I started to get busier with paid work that I found myself having less time for some of the other tasks (and while my business is my baby – I do have to dive back into reality with 3 kids and a hubby and realise that I have a lot of other responsibilities outside work). So I started off small I outsourced a little bit of Graphic Design work here and there. A new Cover Photo, a Video for a website promotion I ran….. some relatively low cost work that was important but not life threatening (if you know what I mean). This helped ease the control freak away from having to be 100% in on every detail. And you know what – it was AMAZING!!!! I got great stuff back that puts my earlier attempts to shame (and lets face it I would never have even tried a video myself). So that little step loosened the death grip I was holding onto in my business (the need to be 100% in control of every detail).

“They often say that the first step is the hardest……

and they are absolutely right.”

So once I started (and as work kept getting busier) I started to think about other tasks that I could maybe outsource…. I picked the things that either took me a long time or that I didn’t 100% enjoy, (well lets be honest I have only just started outsourcing that list but it’s there and I will continue to hand out tasks as I’m ready). Top of the list was something that I loved in parts but that took up A LOT of my time – finding and Scheduling content for Social Media – now don’t get me wrong I love interacting with people on my SM Accounts, but it would take me hours each week to scour the net looking for the right quote, a good relevant article etc. I was so lucky to have the perfect person on board as a client already, so I got in touch with the lovely Louise (from In Deed We Can) who has taken over the job of searching out an scheduling content for my Social Media pages…. and you know what she does it so much better than I ever could. And you know what: it used to take me three plus hours per week and it takes Louise an hour max. I still get to enjoy all the interaction and can post or share as I want to but know that if I get busy there will still be great, relevant content posted for my fans.

Now, I couldn’t forget to mention my Accountability Coach

Hold up before I even get started – I know your thinking it. What on earth is an accountability coach anyway? Well – briefly she kicks me up the bum when I need it (virtually of course). No really, Amanda explains it so much better in her article here. So Amanda really is at least half of the reason I have got myself (and my business) to where it is today. She keeps me real, focused on the goal, and moving forward. It really is hard when you are in business on your own – who do you bounce your ideas off (we all know our hubby’s love us to much to tell us our latest idea warrants a trip to the psychologist – instead they will tell us its a great idea – and we love them for it), Amanda helps me get real – is this going to get me to my goal faster (or better)? Do I have the time to implement it 100%? Could I outsource it?

She is also amazing at reminding me that I need to work on my business not just in it…. yep we are all guilty of it. We get busy and can only focus on getting the work done (meeting the deadline or getting those orders out). And really at the end of the day we all need to take time out to grow ourselves and our businesses, by focusing sometime each day or week to get away from the daily grind and look at the big picture. Are we heading where we want to go? What can we do to get there faster? Under Amanda’s amazing guidance I have smashed my goals for the 2016 financial year (yep I’m a bookkeeper – I have to work in financial years) back at the start of December – a whole 4 months early. She gave me the tools and the confidence to believe that I could do it – and I SMASHED it.

My top tips for outsourcing

So there you have it, it certainly hasn’t been easy for me to let go of the control (even just a little), but I did it. And it has been amazing – my business has continued to grow (it didn’t die because I let others in to help a little), and I am happier and less stressed (I am no longer up at 2am searching the web for relevant content to share on FB). So if I can do it you can do it too……
Let me share a few tips to get you started:

  1. Make a list (or two) of the tasks that you either don’t like or that someone could do better (faster or more efficiently than you).
  2. Take that list and think about how long each task takes you
  3. Pick something (either something small, or something you really dislike doing) and then find someone who is an expert in that area, ask for recommendations from fellow business owners, google, however – and just try it. You can always change your mind.
  4. If you are struggling to let go think about the time that you can save if someone else does that task for you? What could you be doing with that hour a week?
  5. And if you are put off by the cost think about it this way? The experts can usually do a better job, faster than you can. My Social Media work for example: It used to take me 3 hours a week (at my hourly rate of $50 thats $150. It takes Louise 1 hour and costs me $45. If I utilise even 1 hour to complete some of my paid work I am better off (and I have 2 more hours of freed up time and that is worth GOLD)…. not to mention the stress and guilt it saves me.

 

So what would be the first task you would out source if you knew they’d look after your baby (I mean business)? Let me know in the comments below.

Now if you are ready to take that first step….. go for it!!! If dealing with your accounts comes in near the top of the list why not take the first step right now. Flick me an email to dothesums.nz@gmail.com and lets chat about your baby’s (I mean business’) needs.

Getting Data to and from your Bookkeeper or Accountant

In this technological age where you can work remotely with almost anyone – your bookkeeper and accountant is no different

So you can catch up over email, the phone or Skype, but how do you get all those documents to your advisor when you are based in Auckland and your advisor is in Christchurch (or in my case rural Waikato). You can’t just pop round on your way past one afternoon. With all this modern technology getting data to and from your bookkeeper is easy.

So what do you do?

There a three main ways that I get data to and from my clients:

Data for your bookkeeper

Getting That Pile of papers to your bookkeeper doesn’t have to be tricky.

  1. Email – this is the ideal way for quick pieces of information and one or two documents. It is fast and the information is right at your fingertips.
  2. Cloud Storage – Like Dropbox or Google Drive. This option if perfect for larger volumes of documents and files. They are easy for both client and advisor to access and update. The information is instantly accessible. If you keep most of your documents in electronic form already this is the perfect option for you, it is a s simple as giving your advisor access to the relevant folders in your storage.
  3. Post –  sending documents via good old snail mail still has it’s place. There is no point you spending hours scanning everything into the cloud just to send it to your advisor if you don’t utilise this solution yourself. Instead take 5 minutes to pop down to your local post office (or even get a courier pick up from work). A couple of key points to note if you are posting documents, make sure you send tracked with a signature required, this is usually and overnight or 3 days max service (if you are sending rural) and costs approximately $15 on the courier.

 

Want to get these tips straight to your inbox? Sign up here

Load More