How You Should Close The Business Year*

*This is a collaborative post*

Every year you’re in business there will be a beginning and an end. It just so happens that, the start and finish are pretty much going to occur almost at the same time. It's called closing out the business year, whereby you tie up most if not all loose ends. These loose ends could be something to do with employees such as making cuts or hiring new staff. It could also be finishing a deal with clients, investors and distributors so that everything is ready for the new chapter of your business.

It could also be making vast changes to the internal structure of your hierarchy, promoting and or demoting people. Every business whether large or small does this because as you can imagine, things get incredibly hectic and can pile up. Getting rid of the waste and unnecessary extras that are weighing your processes will greatly help to make you leaner and meaner. Here are a few areas which you should start closing out the business year from.

Those That Have Earned It

Promotions don’t happen every year. However the possibility of promotions is accessed every year. Who has shown themselves to have earned your growing respect? Some employees that might have been junior could have done something amazing during the year to help the business succeed to new heights. For example, an employee that was covering for their manager while they were sick, could have created a report that is on par or better than the manager themselves. How you go about promoting an employee can be done in several ways but there is a tried and tested technique. The employee getting the promotion should be trained for a new position and then evaluated. If they score a good result on their manual and written tests that are normally done by directors of departments and human resources working together, then they should be promoted only at the beginning or end of the year.

Reassuring The Government

The best time to close out a business year is simply when you file your taxes. When businesses pay their corporate tax they need to access all four of their financial quarters. Hence why, this is a natural time to close a financial business year and begin a new one. However you no longer need to print off forms and signs them by hand. You no longer need to print of evidence that shows you’re obeying the laws and paying what you should. As of 2020 HMRC is making tax digital via MTD software. Certain companies like Free Agent have been working closely with HMRC to create the software which will be accepted by the government. Using this software you do all of your taxes online, uploading files, filling out forms and also providing a digital signature. You can be helped through the software or if you have a business accountant they can do this for the business.

Promotions and demotions are something to consider just as the business year is ending. You’re making sure that next year your business performs better with the right people in the right positions.

*Contributed by Sam Jones. *Photo source Pexels