The relationship between an entrepreneur and his accountant is like that between a doctor and his patient. However, entrepreneurs often neglect the management and control of their income and expenses, especially those who are just starting out.
As an entrepreneur, you should not be doing your business’s finances alone. If you have already decided to hire an accountant, you surely have some questions, such as: How do I ensure it will respond to my needs? What services and documents do you have to give me? And what will be my final responsibility?
Here, we present a guide on managing a relationship with an accountant.
Hire an Experienced Freelancer
There are specific, precise requirements that your candidate must meet to guarantee their services:
In addition to being a certified accountant, the accountant must have certifications from the professional association Association of Certified Chartered Accountants. This allows the accountant to verify that the information is up to date, which is essential due to the continuous tax changes that occur.
Among the best sources for hiring is the famous “word of mouth,” that is, the recommendation of a person you trust. Ask him for data that reveals his expertise in the matter, such as growth figures for your market, which tax figure is best for you according to your activity, etc. You can also ask him if he does audits.
Seal the Relationship with a Contract
Once the professional is chosen, a service provision contract must be signed. They must offer you, at minimum, to keep your company’s accounting record and calculate your tax obligations. This includes updating you on changes in tax matters and supporting you in the event of any requirement from the Treasury.
It is Customary to Keep Vouchers
Payment of taxes will be made using the financial information your business provides. So, you must have control over it. The basic documents to deliver to your accountant are invoices, receipts, and all proof of income and expenses, in order and by month.
As a client, you need to receive a list of the state of the company’s financial records (business income and expenses) plus a record of the tax payments made by the accountant and their respective vouchers (certified by the corresponding authority). Among the taxes you will have to pay, depending on your activity, are:
- Income Tax (IRS): contribution to be made for the perception of income as a natural and legal person, following the Income Tax Law. It is paid once a month, and to calculate it, you must add all the invoicing that the client has issued.
- Value Added Tax (VAT): an indirect tax applied to the goods and services produced or marketed by the company. It is also paid once a month and is calculated based on a ratio of everything that was charged.
- Single-Rate Business Tax: This tax applies to individuals and companies and is also taxed on profits. You will only receive the first one if your ISR is higher than the IETU.
It carries a periodicity. As an entrepreneur, you should demand these papers every month, not every time you remember.
Those documents prove that you fulfilled the tax obligations, and it must be remembered that in the event of any problem, the Ministry of Finance and Public Credit seeks and penalizes the businessman, not the accountant. For this reason, the entrepreneur must understand that although he delegates the accounting of the business to a professional, he is the one who ensures that all the papers and payments are in order.
Get Informed
There are some items you can deduct for the payment of taxes, such as the purchase of goods related to your business activity. Regarding invoices (tax receipt for the delivery of a product or service) and expenses, it is essential to consult your accountant about any questions so that he will keep a more accurate financial relationship with your company.
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