As a business owner, being organised is vital to managing effectively, and having your finances in order is a top priority. Money is central to a business; without understanding what you have or knowing what you’ll have to pay out, it is impossible to make important decisions such as bonuses, pay rises or hiring new staff.
We’re constantly bombarded by comparison websites telling us about the merits of switching suppliers for utilities, credit cards, car insurance, and so on. It is always prudent to keep on top of our personal outgoings and the same goes for businesses. Financial efficiency applies to all areas so keep an eye on your gas, electric and water bills to ensure you’re getting the best price. Insurances should also be checked to ensure that you’re not overpaying, but you need to look for the best deal, rather than the cheapest price. Your policies must be tailored to the specific needs of dentists and dental practices to avoid any nasty surprises if the need ever arises to make a claim.
Avoid headaches
One of the key areas that require financial planning is tax. This can become complicated; as there are different opportunities open to businesses to reduce the amount of tax payable – all legally and legitimately, of course. There are allowable expenses that can be used to reduce your bill, as well as ways of bringing these forward to defer and delay payments, all of which can aid sound planning. If you’re thinking about buying another practice or selling your existing one, all of this needs careful thought and tax comes into play here too.
On the subject of buying and selling, if this comes into your plans for this year its worth giving it some thought early on because it can be a complex process and not something that can be rushed. If you want to buy, will it be an existing practice or something that will require conversion? Either way, will you need to spend money refurbishing it in line with your existing practice brand or will it be a new entity? If you buy a practice with existing staff, it is wise to look at the payroll to know to avoid any nasty surprises when it comes to paying everyone. Back to taxes, capital gains will come into play whether buying or selling, too. There’s plenty to consider in both scenarios so good initial planning can save numerous headaches further down the line.
Hurdles
Making the resolution to forward plan is a great first step but it can seem daunting with so many aspects to bear in mind. Many people fall at the first hurdle when faced with financial jargon and it can be an off-putting task for many dentists, especially if the business is ticking along in a way that seems like it’s working well. However, calling on the professional services of an independent financial adviser (IFA) can help to unravel the mysteries surrounding your money. These individuals have access to products across the whole market, as well as insightful knowledge and information that can help you efficiently plan all aspects of your business (and personal) finances.
There are IFAs who specialise in different areas and various industries, so the key is to find one that has a focus on the dental industry. In the same way as you wouldn’t ask a kitchen fitter to install your beautiful dental surgery, you should only give your money queries to a professional who really understands the market you work in.
They say failing to prepare is preparing to fail, so now is the perfect time to think about your business finances and start making them work a bit better for you.