A new survey has revealed that the majority of entrepreneurs struggle the most with accounting and tax calculations the most at the early stages of their company’s lives.
The survey by Tide reported that 63% of entrepreneurs who run small newly-found companies waste one day a month on setting up business bank accounts, tax calculations, invoices and expenses.
Tide’s CEO, George Bevis, directed the blame towards banks for their lack of advice to entrepreneurs, as well as pointing out their general inability to provide banking needs to new small business owners.
He said, “The UK’s economy is founded on the success of small businesses, but these figures show that many simply have not been receiving the help and support from banks that they need.
“There is huge demand in the small business community for a financial services tool that helps solve their problems, instead of adding to them. Banks should be working for small businesses, not the other way around.”
The most time-consuming tasks for entrepreneurs were revealed to be tax and accounting, with 54% voting the former as the most challenging financial hurdle and 51% naming accounting as their biggest financial challenge.
Worldpay found that the average UK small business owner spent 48 days a year on admin
For other entrepreneurs, it wasn’t just tax and accounting that were difficulties to overcome. Others named keeping track of expenses (49%), having to use multiple applications to manage different services (38%), invoicing (30%) and payroll (18%) as financial processes they struggled to overcome.
Bevis warned, “In the early days of starting a new business, entrepreneurs and sole traders all too easily find themselves tied up in financial red tape. And while the tasks they have to complete aren’t necessarily complicated, they are time-consuming and unfamiliar, and there can be significant consequences if done incorrectly.”
Even older companies continue to struggle with financial tasks. Tide’s survey revealed that companies between one and five years old struggled most with payroll (27%) and keeping track of expenses (55%).
Research released last year by Worldpay found that the average UK small business owner spent 48 days a year on admin, while 70% believed that they did not have the necessary work-life balance to take a holiday.
Dave Hobday, UK managing director for Worldpay, advised entrepreneurs that digital tools and apps, stating that, “Business owners need to find ways to take back control of their information to become more efficient, make smarter decisions and get that well-earned break.”
If you find you waste too much time on financial admin you can speak to a member of our team to find out how The Accountancy Partnership can help alleviate some of the stress. Give us a call on 020 3355 4047.
You can also sign up to our free cloud accounting software, Pandle, here.
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