Good computer software systems have been available for many years to help SMEs in maintaining the company’s “books”, e.g. payroll, invoicing, VAT returns, etc. and they offer a good, cost effective way of dealing with these issues.

SMS can assist their clients to identify exactly what they require and help with the introduction and running of all relevant systems. SMEs should not be intimidated by the operation of such systems, as they are designed to be used by people with little, or no accounting experience as a “common sense” approach and attitude is usually all that is required.

However, if the client wishes to, most of these operations can be contracted out to third parties, such as payroll bureau, basic book keeping, etc. These issues will always be looked at on an individual basis.

One of the most common questions asked by SMEs , especially start ups, is should we be registered for VAT?

There is a lot of misunderstanding on this subject. A company can voluntarily register for VAT at any time, even though there are minimum annual sales totals, that once exceeded, forces the issue. There should be a positive investigation as to whether VAT registration should be applied for, even if sales are below the limit, as registration can be advantageous to the business and the extra admin required for dealing with the system should not be a reason for not registering.