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Bookkeeping, filing taxes: for most people, not the most fun part of running a business. That’s why entrepreneurs often hire an accountant or bookkeeper to deal with their financial administration. What is best for you? We discuss some pros and cons in this article.
First of all: it’s the base of your tax declarations. Everybody needs to pay taxes and for that, you need an overview of your business sales, revenue and expenses. If you don’t declare this information, the tax office will estimate the amount of tax you owe them, and you might end up paying more or less than you’re actually supposed to, which can also lead to fines.
Secondly, you want to keep track of how your business is doing: Is it growing? Is it in trouble? Are your customers keeping up with their payments? With proper financial administration (or bookkeeping) you will always have a clear overview of your business’ financial health and, if needed, you can take action in time.
You can imagine that keeping your finances organized is possible as long as it’s manageable. For example: You have a sole proprietorship (eenmanszaak) and you only send a handful of invoices weekly. You also have the (computer) knowledge to keep a small financial administration.
But if you have a construction company (N.V. or B.V.) with over 10 employees and even more subcontractors, purchasing materials from various suppliers, working on various locations for multiple clients. In this case it might be worthwhile to hire someone. It will save you time and money, because you can focus on your core business, your sales, marketing and business relations.
The costs of outsourcing your financial administration depends on how much of your administration you’d like them to handle on your behalf: just the tax declarations or the payroll or also the yearly statement?
Keep in mind that, whether you do it yourself or you hire someone to do it for you, you as the business owner are at all times responsible for your business’ books and administration. So even if you outsource these tasks, it’s still your responsibility to check in with your accountant and the tax office regularly, to see if everything is being done right.
Read more about this topic in the interview with Andrenne Roulston, from Angel’s Administration on St Eustatius.
We would like to inform you that the contents of our articles (including any legal contributions) are for non-binding informational purposes only and do not in any way constitute legal or financial advice. It is not intended to replace individual and binding advice from e.g. a lawyer or an accountant that addresses your specific situation.