Financial planning ­ Business

All small businesses need finance before they can begin and subsequently expand. It is important to look for several sources of finance whilst starting a business so as to try and keep a tight control of money coming in and going out.

There are various sources including:

Own investment

If you are not willing to invest in your business, you can not really expect anyone else to.

At the start it is important to invest with cash that you have available whether it is from you, family or friends. If this is possible it has benefits as there are no interest charges. Your own investment could also be in the form of tools, equipment, vehicles, stock, property or other assets which can be used as interest to raise cash.

Bank support

All high street banks will have a specialist team of business advisers that can assist small businesses with advice and practical solutions such as loans, overdrafts, etc

The size of overdraft and loans available can vary depending on your business plan and your bank manager.

Non Bank support

Throughout Tyne & wear there are a number of local enterprise agencies and other organisations, which offer help and advice to new and young businesses.

The Princes trust

The Princes trust provides assistance in the form of financial help, business mentoring and marketing opportunities to applicants 18-30. Applicants are normally unemployed, underemployed or of limited means to start up in business. The trust is a last resort and aims to help those who are unable to get all the support they need elsewhere.

Book keeping

Records are kept for several reasons. Most importantly they provide up to date information on how your business is doing. It is often said that the lack of information regarding the progress of a business is the main cause of failure for small companies. If you have up to date information about your sales levels, expenses, profit margins, bank balances etc you can take steps to change these. Knowing you finances is very important.

Additionally you can calculate your various tax liabilities. Without accurate information you could end up paying more than you need. Under self assessment there is now a legal requirement for everybody, both employed and self employed to keep personal records for both tax purposes.

Tax ­ what you need to know

As soon as you start your business you must tell your local tax office, the contributions agency and your job centre (if registered). The three main areas are:

• National insurance
• Income tax
• VAT