Questions & AnswersWriting financial plan, do you have advice?
saramaaria asked 7 years ago

Writing financial plan, do you have advice – Free Online Small Business Accounting Software Questions & Answers

Hi,

As I have had the chance to browse around a little bit, a few thoughts came to mind. Maybe some of them are already answered in the community field, but haven’t been able to find it.

What exactly can be added in the tax returns or somehow else deductible? Can web hosting, rental costs for office space, and accountancy be included?

Do you have any advice for making the financial plan for the business plan, which I’m writing? It might be something worth looking into, to have it added as a section on the site. Financial part is important for any potential investor as well as getting clarity on the business for the owner. For a novice, it can be difficult to create all the tables.

I’ve seen and downloaded the document to get €100K in grants, do you have any updated sources where a photographer should look for grants? Is it applicable only for a limited company or for other types as well?

Not only do I have a day job, but I am working on getting two businesses started – photography for myself and business coaching with a friend – does this clash somehow? The day job is only to keep me afloat till I can be fully independent.

My individual company will be registered as sole trader. The other company would most likely be partnership, as there are two of us, however limited company has crossed our minds. How to decide which company type would be best?

Any thoughts and advice is valuable, thanks in advance!

0 Answers
Peter Connor Staff answered 7 years ago

Hi Sarah,
So, I’ll break each question down and give you an answer.
What exactly can be added in the tax returns or somehow else deductible? Can web hosting, rental costs for office space, and accountancy be included?
Anything that is a legitimate company expense can be paid for by the company (all above). It’s not free, the company pays for it and that then gets put against the tax you have to pay at the end of the year.
So you could be a fashion photographer so buying a stuffed cat as a prop would be a legitimate expense, but your morning coffee aren’t nor is entertainment 🙂
Do you have any advice for making the financial plan for the business plan, which I’m writing? 
I’m going to give you two answers for this, real world and investor world.
Real World: Although we’re an accounting software company we put very little into detailed financial planning for early stage companies, there is too much unknown out there. 
So what I’d do is try and keep it all on one page and focus on answering the bigger questions. 
How much money do I need to live?
How much does my product cost to build/run?
How much is the market willing to pay for my product (not how much you think they’ll pay)?
Is there enough left over for me to pay myself, run my company, and spend on sales and marketing?
Use easy numbers; for VAT take a quarter, for tax take half. I know this isn’t right but like I said keep it easy.
I’d double up on costs and double down on sales, to give you more realistic number. A good tip if it’s a new area of business for you is to keep your old job or side job till the business is up and running. If you think you’ve got pressure in work wait till the debt collectors call. 
Investor: Find out what their criterias are and make your numbers match that esp if it’s government funding – it’s an academic approach to business therefore bullshit. But it’s their bullshit so make it work for them.
But, live by the real world numbers.
I’ve seen and downloaded the document to get €100K in grants, do you have any updated sources where a photographer should look for grants?
Not really the government support is based around a political agenda (not in a bad way most of the time). So, they focus on types of companies that create lots of jobs. Unless you are creating a photography product company I think it will be hard to get grants.
I suspect there aren’t a lot of photography service based companies out there hiring over 10 people. They’ll also question why you’d need support, it’s not cost prohibitive to set up a photography business. 
There will be business training courses you can get access to, and maybe some studio space etc. 
Is it applicable only for a limited company or for other types as well?
Only limited companies can get grants.
Not only do I have a day job, but I am working on getting two businesses started – photography for myself and business coaching with a friend – does this clash somehow? 
Keep your job till you can’t cope with the new work or the money matches. Work weekends/nights, 4 day weeks whatever it takes. 
You can do what you want, the only issue I’d think would be time. Those careers don’t overlap so one isn’t going to feed business into another. Both are quite labour intensive.
Do the one you love, or allows you to do what you love. It depends on the kind of business you want to do. I can’t see how you couldn’t business couch Mon – Thursday and do wedding photos Fri/Sat etc.
My individual company will be registered as sole trader. The other company would most likely be partnership, as there are two of us, however limited company has crossed our minds. How to decide which company type would be best?
We always recommend people to be limited companies, it’s more tax efficient and all the costly laborious accounting stuff is now automated by Bullet!
If you’re running a small limited company you could do all your own accounts and mid year tax returns in Bullet – we fully automate it. Then just pay an accountant between 400-1000 a year to do your books, you’ll get that back in tax easily.
It also covers you. So if you have a big camera light and it falls over and hits the Bride. If your a limited company she can only sue the company – if it doesn’t have the money it goes bust. If you’re a Sole Trader she sues you so your car, house, savings are on the line. Why run that risk for 400 quid a year. 
Brendan Brady can help with both new companies and yearly accounts. He doesn’t work for Bullet but we hear great things.
Partnerships
There kind of businesses reserved for Solicitors and Accountants, where they’re individual’s coming together. We only cover Limited and Sole Trader in Bullet. 
Don’t setup anything till you’re making money! Hope that helps Sara, thanks for the great question.
Pete
 
 
 

saramaaria replied 7 years ago

Thank you, Pete! It has helped tremendously and it all makes sense now :).

One more question regarding limited company. Does it matter how much the company makes in order to register limited company? I’ve understood that it’d be advisable to have a limited company only when it makes over €200-300K a year. Is there a difference between small limited company and large, as I got that idea from your reply? Would you, therefore, recommend registering both companies as limited?

For taxation purposes, the owner’s income is not counted with limited company but they are two separate things?

Will definitely get in touch with Brendan Brady – thanks for the recommendation.