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At the time of publishing, we are less than 2 months away from the dawn of a new year. 2026 will be here before we know it! If you have spent time during 2025 pondering the idea of a new business or making your skills available as a freelancer or consultant, then this is an article you will want to read (and probably bookmark to come back to!)

Starting your own business is an exciting time. Even though it’s hard work in the beginning, with so much to do and manage, the dream of what the business could become is motivating and inspiring.

We’ve been in a privileged position to support lots of start-ups in the early stages. We’ve witnessed many successful business start-ups, and we’ve also seen plenty that haven’t quite made it past the hurdles of those first critical years. That’s why we decided to write this article and share our advice on the common pitfalls to avoid when starting a new business.

If you get the following areas right from the beginning, there’s no reason why your business shouldn’t flourish from the start, going from strength to strength.

Common pitfalls to avoid when starting a new business.

With four decades of experience advising growing businesses, our team have pulled together five key common pitfalls that start-ups experience, and how to avoid them.

• Understand how cashflow works and how to manage it.

All the business books will tell you that “cashflow is the lifeblood of the business”, and they are right! If you can get a good understanding of how cash comes into your business and when it goes out, you’ll have a greater chance of avoiding a cashflow crisis. No business wants to be in a position where there’s not enough cash in the business to pay the bills on time, especially HMRC.

It’s not enough to glance at sales reports and accept that the business is profitable. Sales reports only tell one side of the story. Get to grips with the costs of running your business too, and make sure customers are paying you in plenty of time before those costs fall due.

Want to learn more about effective cashflow management? Check out the “Know your cashflow” blog.

• Invest in your Terms and Conditions.

Having rock-solid terms and conditions will save you a lot of heartache in the long term, and could help you to avoid a cashflow crisis (or certainly limit the impact). As tempting as it might be to save costs in the early days and use free templates (or even Chat GPT), having your terms and conditions written by a legal professional who understands the specifics of your business is a wise investment. They are the experts who will know the right clauses to have in place – things you might not have considered yourself.

A great one to include is late payment fees. It’s a great deterrent for any client not to pay you on time!

• Get a strong grip on your time management.

Businesses started by a single founder can often struggle because there is one person responsible for everything in that business. It is easy for them to feel overwhelmed and potentially reach burnout without the business getting out of the starting blocks. Our best advice here is to manage your time as effectively as possible. Understand the various hats you have to wear and allocate time accordingly. It’s easy to be pulled from admin to compliance, then to sales and marketing, but a clearly defined time for each area of focus will help you be more effective.

Most importantly, carve time out for yourself as an individual. Friends, family, hobbies – they all boost your energy and motivation when the difficult days of running a business rear their head.

If you recognise that you need to bring expert skills into your business to free up your time for other areas, you might consider outsourcing. This blog shares advice on outsourcing payroll.

• Identify your ideal client and how to communicate effectively with them.

With a clearly defined target customer in mind, your marketing and sales activity will be more effective. Invest time in creating a customer persona. Understand what that decision maker or user looks like from a demographic point of view. What motivates them? What pain point is your product/service solving for them? What language do they use to talk about this problem and solution?

By getting under the skin of your ideal customer, using the language and terminology they use, you’ll avoid trying to sell to everyone and struggling to get any engagement. This blog includes a section on market research if you’d like to boost your marketing.

• Lean on the right advisers.

We’ve already alluded to this, but you don’t know what you don’t know. And this statement is especially true for entrepreneurs starting their first business. You can save yourself time and the risk of getting things wrong by working with professional advisers from the beginning. Areas such as accountancy, HR, marketing and legal services. It can be tempting to save on professional advisor costs, but non-compliance can cost you more in the long term. Here’s a reminder of how pretending to know what you don’t know can be costly.

 

Whether you are planning to start your first business or your twenty-first business, the team at Accounting Clarkes would love to hear about it. Book a discovery call today! Call Gillian and Chris on 01252 612484 today.

We have worked with lots of local landlords for many years. The tax landscape has increased in complexity over the last decade, and the most recent development comes into effect in April 2026, with the introduction of Making Tax Digital for Income Tax. You can read more about those changes here.

In our experience, sole trader landlords (those who aren’t set up as a limited company) prefer to manage their own tax affairs if they feel confident enough to do so. However, when tax legislation changes (as it inevitably does), it isn’t easy to maintain that knowledge and confidence, which is when you need a trusted accountant and tax advisor to guide you.

This month, our blog is led by the common questions we’re currently hearing from sole trader landlords. We’re going to set the record straight on allowable expenses as a buy-to-let landlord, and what you can (and cannot) claim on a self-assessment tax return.

What expenses can a buy-to-let landlord claim against tax?

You will need to complete the ‘UK property’ pages of your tax return if you earn income from letting out residential property. This is where you declare the income you have received, and details of all the expenses associated with the rental of that property. Some will be allowable expenses that can be deducted from your rental income, therefore reducing your taxable profit. Other expenses are not deductible, and this is often where issues can creep in. If you’re not clear on which expenses are allowable, you could end up with a bigger tax bill than you were expecting!

Allowance expenses must be wholly and exclusively for the purpose of renting out the property, for example:

• General property maintenance and repairs (e.g. fixing a boiler, repainting between tenants)
• Utility bills (if paid by you): water, gas, electricity
• Council tax (if paid by you)
• Ground rent and service charges
• Insurance (e.g. building, contents and public liability)
• Letting agency fees/management fees
• Accountant’s fees
• Direct costs (e.g. advertising for new tenants, phone calls, stationery, postage)
• Gardening and cleaning costs

You can also claim for the costs for disposing of old items of furniture or electrical appliances (but take note that the replacement must be like-for-like, and you must deduct any sale proceeds from the old item).

Mortgage Interest Relief.

The area of expenses which causes the most confusion with sole trader landlords is mortgage interest relief. Before April 2020, landlords could deduct mortgage interest from their rental income to reduce their taxable profits. This relief was phased out between 2017 and 2020.

Today, landlords cannot deduct mortgage interest from rental income. Instead, they receive a 20% tax credit on mortgage interest paid.

Landlords can claim 20% on the lower of:

1. Mortgage interest paid in the tax year
2. Property profits (after other allowable expenses)
3. Adjusted total income (above your personal allowance)

If your rental income was £11,400 per year and the mortgage interest was £7,200 per year, the tax credit would be based on the mortgage interest. In this example, the tax credit £1,440 (20% of £7,200).

The good news is, that any unused portion of tax credit can be carried forward i.e. if your mortgage interest exceeds your property profits or adjusted income.

Personal, proactive and professional tax advice for landlords.

The team at Accounting Clarkes have worked with many landlords navigating the complexities of the tax landscape. We know how busy you are taking care of your properties and your tenants, and possibly running this alongside other businesses or employment!

If you’re looking for a friendly team of accounting and tax professionals, look no further than Accounting Clarkes. Book a discovery call with Gillian and Chris today – call 01252 612484.

Making Tax Digital for Income Tax (MTD) is a significant change that will impact the self-employed and landlords from April 2026. Change can often be met with reluctance and procrastination, because it is new and unknown. The fact remains that anyone self-employed or a landlord with an annual business or property income of more than £50,000 (based on 2024/25 earnings) will need to start preparing for MTD.

If you’re self-employed or a landlord earning less than £50,000, MTD will still apply to you, but not until April 2027 or April 2028. We outlined the MTD rollout thresholds in our blog, “The countdown to MTD for Income Tax is on.”

The importance of preparing for MTD.

What is essential to being prepared for MTD is using MTD compatible software. This software will allow you to maintain digital records and submit the required quarterly updates to HMRC. Remember, the aim of MTD is to reduce the tax gap and bring the tax system closer to real-time.  MTD compatible software will save you time and reduce the potential for data entry errors. This means your tax bills will be more accurate, which means you can budget with confidence.

If you don’t use MTD compatible software yet (perhaps you still use spreadsheets), now is the time to research the various software providers. The ones most popular with the self-employed and landlords are Xero, FreeAgent, and QuickBooks. They all have their pros and cons – it’s about finding the right one which suits the needs of your business and how you like to work.

Who needs to start preparing for MTD?

As outlined above, any landlord or self-employed person with an annual property or business income of more than £50,000 needs to prepare themselves for MTD for Income Tax, which comes into place from 6 April 2026.

It’s estimated that 1.4 million landlords and 900,000 sole trader businesses will be impacted by the April 2026 changes. Are you one of them?

How Accounting Clarkes can help you prepare for MTD for Income Tax.

With over four decades of experience across the team, helping businesses of all shapes and sizes grow sustainably, we understand the support and guidance that sole traders and landlords need. Our knowledge and experience have shaped two MTD solutions, which we’re delighted to share with you in this article.

Option 1 is designed for business owners who would like to manage their own bookkeeping and quarterly submissions to HMRC. Accounting Clarkes takes care of the annual review, including adjustments, and the annual self-assessment. All the major software providers are offering free training for MTD to demonstrate how to complete the quarterly submissions. If you are unsure where to find them or would like training in person with one of our team, do get in touch.

Option 2 is designed for business owners looking for a full-service solution to manage their tax reporting obligations. From quarterly bookkeeping, reviews and submissions, through to the Final Declaration (your annual self-assessment), this package takes care of it all. Our outsourced solution will utilise the Ignite package from Xero.

Click here to view our MTS Package Pricing or contact Gillian Clarke for more details and to set up a discovery call: gillian@accountingclarkes.co.uk or call 01252 612484.

Whether you’ve started a business to follow a passion or interest, or you’re set to disrupt an established and competitive market, you’ll likely want to grow and develop your business over time. The good news is that the team at Accounting Clarkes has decades of experience helping businesses like yours grow.

Growth brings its own unique set of challenges at various stages. Some businesses need an injection of cash; others need a strategy to bring in the skills the business currently lacks. Growth rarely happens overnight. You need to have a plan and be prepared!

With that in mind, our team have pulled together the ultimate checklist to help you grow your business. We’ve broken the checklist down into three key areas: business strategy, finances, and market research.

 

Business strategy

• Where do you want to be in 3-5 years?

You need to have a clear vision as to what you want the business to achieve over the next 3-5 years. It may feel overly ambitious initially, but once you begin to paint the picture of where you want to be, you can then start to break this down into smaller objectives and map out a plan of how to get there. If you want tips on goal setting, check out this blog!

• What non-financial goals do you have?

Growth is typically linked to financial goals, but it doesn’t always have to be. In fact, we recommend that you have some non-financial related goals to motivate you, too. This could be related to spending more time out of the business, or creating opportunities for staff to volunteer their time with a local charity.

• Do you have access to the right expertise?

A common growth obstacle that businesses come up against is a lack of expertise in areas that become strategically important, such as finance, marketing, operations and HR. You don’t have to employ experts in these fields, but outsourcing or having access to the right advisors is something that successfully growing businesses will do well.

 

Finances

• Utilise your financial reports, especially cash flow forecasts!

If there’s one area we would encourage any business owner to dedicate more time to, it’s taking a closer look at and understanding what the numbers in the business mean. Whether you are reviewing the pre-defined reports in your accountancy software, or an accountant prepares monthly management reports for you, put time aside to interrogate and question the numbers you are seeing. Here’s a blog about how to find those cashflow insights hidden in your accountancy software.

• Review your prices regularly.

You should regularly review your prices and, where appropriate, increase them. How much have your supplier and utility costs increased over the last 12 months? This will impact your profit margin, and you won’t grow as quickly. Diarise the reviews if you must!

• Invest in qualified tax advice

The tax landscape is continually evolving, and there could be allowances that you aren’t making use of. You should have a tax strategy that considers the implications of tax as you grow. For example, once your business reaches a taxable turnover of over £90,000 within a 12-month period, you’ll need to register for and start paying VAT. Being a VAT-registered business will have an impact on your prices and your financial admin, so you need to be prepared for the changes.

 

Market research

• Are your products/services still in demand?

There are some products and services that will stand the test of time, and others will simply trend for a year or two. It’s important that your business has a demand for what it is you offer. If demand is trailing off, consider other markets you could move into, or pivot your business altogether! Remember what the coronavirus taught us about how habits can change overnight!

• Review your competitors regularly.

Even the most established markets can be disrupted – look at what Airbnb has done for accommodation, and Vinted has done for the second-hand fashion market. There may be competitors that you dismiss based on your knowledge of them, but if your target market considers them as an option to solving their problem, then they’re a competitor you need to be aware of.

• Talk to your customers.

You can gain valuable insights from continually talking to your customers. They already know, like and trust your business; they can be a great sounding board as to what you’re doing right, and where areas could be improved. They are also a captive audience to upsell to, and far cheaper than acquiring a new customer.

 

Tell us about your growth goals!

Share with us where you want your business to be by 2030. At the time of writing, that’s just 4.5 years away! Will you be doubling your turnover? Expanding into new premises? Thinking about your exit strategy?

We’ve been advising growing businesses for over 40 years. We could bring together that expertise to support your business, too. Book a discovery call with us today.

A recent survey by GoCardless and the Federation of Small Businesses (FSB) has found that 45% are experiencing more late payments than 12 months ago. This doesn’t surprise us at all. We are often talking to our clients about the importance of keeping on top of credit control to protect their cashflow.

The knock-on effect of not being paid on time is that your business could reach the point of being unable to pay your suppliers on time as well, and the problems have a ripple effect down the supply chain.

Debtor days.

Do you know what your current debtor days are? Do you understand how to calculate debtor days? Don’t worry, we’ll explain.

Debtor days are a measure of how long it takes for you to collect payment from your customers after a sale on credit. It’s calculated using this formula:

(Average Accounts Receivable / Total Credit Sales) * 365

If your debtor days are low and within your payment terms, it means your clients pay you promptly. If it’s high, it means they take longer, and this could have a negative impact on your cashflow, especially if those invoices are often paid past their due date.

What is a strong credit control process?

A strong credit control process is a combination of:

• Clear communication with the customer about your terms and conditions
• Sending accurate invoices on time
• Initiating proactive reminders
• Having a consistent follow-up process for managing overdue invoices.

Having these four areas covered should limit the potential for clients to pay their invoices late, but of course, late payers do happen.

Our team have created some top tips to help you keep on top of credit control, if your business regularly struggles with late payers.

Keep on top of credit control – Top tips!

1. Keep your accounting software up to date.

It’s important to regularly explain the transactions in your bank feed and to match up payments received for invoices. Then, when you review the status of your invoices, you’ll have an accurate view of which invoices are overdue. It also means your calculation of debtor days will be accurate.

2. Use automated reminders.

We highly recommend switching on automated reminders as part of your invoice settings. It means your clients will receive an email informing them that payment is due, or past due, without you having to remember or do anything. It saves you time and can often be the nudge that clients need to make the payment.

3. Review persistent late payers.

Your accounting software can highlight those clients who consistently pay you late. Take the time to have a conversation with them. You might learn a bit about how they process invoices (and how to improve your chances of getting paid on time) or gain clarity on their financial situation. Use this to make informed decisions about how you work together in the future to minimise the impact on your cashflow.

4. Overdue by 20 days or more? Help them pay.

If you have clients who are overdue by 20 days or more, you have a problem that will be impacting your cashflow. Rather than get angry or frustrated, you need to address the amount owed and find a way to help your client pay their invoice. Speak to them about the situation and rather than demand the payment in full, offer a payment schedule. Take a part payment immediately and agree (in writing) when the balance will be paid.

5. Incentive early payment.

There are a number of ways to incentive a client to pay their invoice before it’s due. Check out our tips to help reduce your accounts receivable days here – “Know your Cashflow” blog.

 

Outsourcing credit control.

We understand that keeping on top of credit control isn’t always a nice task, and it’s not the reason you set up your business! Lots of companies have more success with credit control when it’s managed by a detached third party. The person chasing doesn’t have to feel awkward about asking for payment, and it can help to protect the client relationship in the long term.

Believe it or not, some people enjoy taking the role of credit controller, and we have someone in our team who is brilliant at it too!

If managing your credit control is becoming too stressful and time consuming, and you’d like to hand that responsibility over to a person with the right personality and skills, get in touch.

Allow our team to free up your time for the parts of your business you enjoy, knowing that the right communication and action are being taken with your clients to bring in the money you are owed.

Call Gillian and Chris on 01252 612484 today.

Will your business be ready on time?

If you’re a business owner, you’re probably familiar with the words “Making Tax Digital” or MTD. MTD aims to reduce the tax gap and bring the tax system closer to real-time. It will require businesses and individuals to maintain digital records and submit quarterly updates each quarter using MTD compatible software.

As well as saving you time and reducing the potential for data entry errors, it will mean that your tax bills are more accurate (so no huge surprises at the end of the tax year!)

MTD for VAT was introduced for all VAT-registered businesses in April 2022. Now the government is rolling out MTD for Income Tax.

The countdown for MTD for Income Tax has begun.

We are now less than 12 months from the first MTD for Income Tax deadline, so it’s time to start preparing. You need to be clear on when MTD applies to you and ensure you are registered and have the right software in place.

Don’t leave these things until the last minute. You can avoid a lot of stress and iron out any teething problems. Though there may be some grace from HMRC during the initial transition, we know from experience that missing deadlines attracts fines and penalties.

To help you prepare, we’ve answered some of the most common questions we’re receiving from business owners about MTD for Income Tax.

 

1. How is the self-assessment tax return changing?

Under MTD for Income Tax, self-employed people and landlords will be required to submit summary updates of income and expenses to HMRC every quarter. This change is not relevant to those who have self-employed income in addition to employed income. At the end of the tax year, when you would normally submit your self-assessment tax return, you will submit a ‘Final Declaration’ to confirm your end-of-year position for tax. This will determine the tax you owe to HMRC.

 

2. When will MTD for Income Tax apply to me?

That depends on your income. MTD is being rolled out over the next three tax years in phases, based on qualifying income. Here’s a summary of when you’ll be required to follow the requirements for MTD:

• From 6 April 2026, if you’re self-employed or a landlord with an annual business or property income of more than £50,000 (based on 2024/25 earnings)
• From April 2027, if you’re self-employed or a landlord with an annual business or property income of more than £30,000 (based on 2025/26 earnings)
• From April 2028, if you’re self-employed or a landlord with an annual business or property income of more than £20,000 (based on 2026/27 earnings)

Beyond April 2028, we don’t know what changes HMRC will make and whether MTD for Income Tax will roll out to those earning less than £20,000.

We will be reaching out shortly to those clients who need to be registered by April 2026.

3. Why do I need to have compatible software to be able to file MTD?

MTD-compatible software will allow you to keep digital records and make submissions to HMRC electronically. There are lots of benefits to using accountancy software (as opposed to spreadsheets or paper records), including streamlining your invoicing processes, tracking expenses and real-time reporting.

The purpose of MTD is to be able to share your data digitally, which means HMRC will have an accurate record of your income in real-time.

 

4. Which accountancy software should I be using?

There are lots of accountancy software providers to choose from including Xero, FreeAgent and Quickbooks. If you’re not sure which one to use, speak to fellow business owners or your accountant. They all have their benefits and flaws – it’s about finding the right one which suits the needs of your business and how you like to work. Also, take a look at apps which integrate with each software – these can save you time through automation as well as give you more insights.

 

5. I already use accountancy software, will it automatically update?

We work with the majority of software providers across our portfolio of clients. From what we’ve seen, they are already well ahead of the game and starting to communicate the associated changes with users. There may be some updates you need to apply to your account to ensure your data can be sent to HMRC. Speak with your software provider or accountant is you have any questions.

 

6. How much will MTD cost and will I see any financial benefit?

Naturally, business owners are concerned that MTD will take up more time on admin and increase their accountancy costs. The aim of MTD is to help business owners manage their cash flow and tax liability ore effectively and reduce business admin.

By using MTD-compatible software, you’ll be able to submit your quarterly updates to HMRC by the touch of a button. It’s simply taking the data that’s already in your account.

If you would prefer your accountant to manage your quarterly updates, there may be an additional cost for them to do this. It may alleviate the stress from managing the updates yourself and making sure you meet the required deadlines.

We think MTD is a great opportunity for business owners to get closer to the numbers and manage their budgets in real-time.

 

MTD for Income Tax is best looked upon as an opportunity to do things better and to reduce business admin overall. Better insight/accuracy on ongoing cash flow and tax situations – better budgeting and forecasting

 

Have we answered your question?

If your question about MTD for Income Tax hasn’t been answered, we’d be happy to hear from you. Send Gillian an email at gillian@accountingclarkes.co.uk. You can also connect with Gillian on LinkedIn here.

 

We hear all sorts of questions from our clients. Naturally, we are often asked how they can save money, and specifically… how they can save tax!

We’re observing lots of businesses thoroughly reviewing their costs in light of the changes in employers’ national insurance contributions and generally feeling the pressure of inflation and increased costs across multiple areas of the business.

Accountancy and advisory costs are no exception to the cost review. As with any service, there are always ‘DIY’ and cheaper options to explore, but will you save any money by using them? Let’s take a closer look.

There will always be a ‘cheaper’ accountant.

The team at Accounting Clarkes has been around long enough to see multiple cheaper solutions come into the market. Most recently, there’s a growing market of online ‘accountants’ offering accountancy services at a cheaper, flat fee rate. It’s estimated that unregulated accountants account for one-third of the profession. These are individuals who call themselves an accountant but are not registered with a professional accounting body. You can read more about how to spot an unregulated accountant here. If you’re being serviced entirely online, you may not truly know who is advising your business, which qualifications they hold and whether they are registered with a professional accounting body.

The online accountancy service offering often focuses on making you compliant, and that’s all. Compliance is important, but if you’re also wondering how your accountant is going to save you money, that’s a different level of service entirely. It’s key to be clear on exactly what you will be getting for that fee (and what you might be missing out on).

If you want your accountant to think about your business and personal finances holistically, then you need to shop around. Advice like this does come at a premium, but you’ll get a greater return on your investment in our experience. Ask your network for recommendations and see which firm is the best fit for you.

The tax landscape is always changing.

This is where your accountant should impact cost saving in your business. The reality is you don’t know what you don’t know, and it’s your accountant’s job to understand the changes in tax and make you aware of what’s going to have an impact.

Paying more tax is the result of your business growing. There are lots of areas to consider in how growth will impact the amount of tax you pay which is why it should have a plan behind it. There will be areas where tax can be offset, or tax reliefs utilised – only if you know about them and how to apply them.

Ask yourself, is your accountant reactive to your questions about saving tax, or proactively identifying opportunities to help you be as tax efficient as you can be?

Do you know the right questions to ask?

If you’re looking for your accountant to be proactive in saving you money, take a moment to consider how much time your accountant currently spends asking you questions about the business – where you’re currently at and want to go. Is your accountant interested in what’s happening outside of work, that might have an impact? Do they seem genuinely interested in what your company does and what your personal aspirations are? Time spent like this is valuable for unlocking cost-saving opportunities.

But it’s not just about the questions the accountant asks you. Are you asking THEM the right questions? We work alongside our clients to help them understand the questions they should be asking – to interrogate and understand the numbers in their business. Think about how differently these questions could be answered:

• Am I paying the right amount of tax?
• Is there a way for me to offset any of my tax bill next year?

Accountants who look at your business holistically will love that second question and take the time to explore the options with you. If they are just servicing you from a compliance perspective, they’ll be happy to answer the first question with a ‘yes’ and leave the discussion there.

Remember, it’s not just about monetary savings.

We know that your business wants to save money but remember that a great accountant can also save you:

• Time – whether it’s outsourced work or the time searching for the right answers or ways to do things
• Stress and worry – from knowing your business accounts are being managed correctly
• From the consequences of getting things wrong – yes, this can be fines and penalties but serious wrongdoings could get you disqualified as a company director and potentially face prosecution.

A local accountant who can save you money and so much more.

Come and meet the team at Accounting Clarkes and discover how we can support you and your business to reach your goals and aspirations, remaining as tax efficient as possible along the way. Call 01252 612484.

It’s estimated that 20% of small businesses will fail in their first year, and 60% will fail by year three. Running your own small business isn’t easy! At Accounting Clarkes, we’ve worked with organisations of all sizes for over 40 years and helped them to ride out the highs and the lows (and everything in between!)

In this month’s blog, we’d like to get you thinking about business risk and how well you’re protected. Knowing where the biggest risks lie and putting in the right protection won’t necessarily prevent difficult situations from occurring, but you’ll be in a strong position to mitigate the risk and move forward.

Let’s take a look at some of the biggest risks to small businesses.

Unmanaged cashflow

As accountants, we will naturally start with finances. It’s not uncommon for business owners to glance at sales reports and believe that the business is financially sound. They may have a general idea of their costs, but quite frankly, they don’t delve into the detail… until a problem arises. Putting aside the wider economic changes, if a business isn’t clear on when revenue is coming in and costs are going out, the unexpected can pose a huge risk to the solvency of the business. A string of late payers or being ill-prepared for upcoming bills (especially tax) can very quickly cause you and your business significant problems.

Preparing cashflow forecasts, profit and loss reports, and scenario planning can easily be done at the click of a button if you use accountancy software. You then just need to carve out time to understand thoroughly what the numbers are telling you. Better than that – use your accountant if you’re unsure. Ask them questions about your understanding. They could even save you time preparing the reports for you!

Cyber threats

Around 38% of micro and small businesses in the UK reported experiencing a cyber attack in the last 12 months, according to the UK Government’s Cyber Security Breaches Survey. This year, the Government is due to publish the Cyber Security and Resilience Bill, to help protect UK cyber defences.

Small businesses are at a greater risk of a cyber attack because they aren’t as well prepared as larger organisations, and cybercriminals target them specifically. Many don’t know how to fully protect themselves. For some, it’s viewed as an additional cost. A cyber attack can cause a lot of damage. There’s the immediate business disruption, of course, but longer term, the reputational damage to clients and suppliers can be significant.

We aren’t cyber security professionals but we recommend every small business owner engage with a reputable IT services provider and address their cyber security as a matter of urgency.

Regulatory risk

Compliance is critical for any business. The consequences, like with cyber threats, aren’t just the immediate financial cost – reputational damage can do more harm in the long term, and potentially be the reason the business comes to a close. Even when business finances are strained, failure to comply with regulatory requirements is no excuse.

As accountants, we can support you with the regulatory duties of being a company director and ensure you comply with tax regulations to avoid unnecessary penalties. We can also support you with payroll and ensure that your employees are paid in line with minimum wage rates (which are due to increase in April).

Though we can’t comment on industry-specific regulatory bodies, we imagine many of you will be using customer data to market to them. You should familiarise yourself with the Data Protection Act (GDPR) to ensure you are protecting the data you have acquired and use it in the right way.

Working with the wrong people

Hopefully, your business won’t encounter this risk too often, but it does happen. Whether it’s an employee, supplier or customer, working with the wrong person can have a huge impact on your business and pose a big risk. Employees can disrupt the working environment and have an impact on other members of staff. HR advice and employment tribunals can also be costly.

Clients who are late payers will undoubtedly impact your cashflow. If you’ve prepared for such a scenario, you can potentially minimise the impact until payment is made or you seek legal action for what’s due. Sometimes, it’s not that a client doesn’t pay – they might not be the right fit for your business and as a result, you have a difficult relationship to manage.

Due diligence is key here. Put in the effort to fully vet future people you work with, and this risk will be minimised.

Reduce your risk by working with a qualified accountant

Managing risk is an important skill when running a business. We help our clients to assess risk and to make informed decisions based on their financial data. We’re proud of the relationships we build with our clients – they know they can turn to us for advice and support whenever they need it.

If you’d like to explore how Accounting Clarkes can help your business achieve its goals in 2025 and beyond, call us on 01252 612484. We’ll invite you to a discovery call so we can get to know you, and just as importantly, you can get to know us.