Tax Help Available For Small Businesses By Jennifer Park

Many small businesses tend to procrastinate when it comes to filing for taxes. They behave in this manner for many different reasons. Some are uncomfortable in this unfamiliar territory, so they keep putting it off. Others, caught up in the daily operational issues of running a business, simply can't find the time to sit down to tackle the tax issue.

But filing for taxes is no small matter. It is required by law, and there is a dateline for filing taxes. Therefore, small business owners should take the matter seriously. They may even consider shutting down the business for a day or two just to give themselves time to settle the tax issues. However, for those who are unfamiliar with taxes, a day or two just isn't going to be enough time.

The right thing to do here, is to hire a bookkeeper. A full time bookkeeper will help maintain the books in a well organized and professional manner. When the time comes for filing taxes, everything is a breeze. Still, as the business continues to grow, it may have outgrown the services that a bookkeeper can provide. The needs of the business becomes more complex. In comes a qualified accountant. An accountant is better trained, and will be able to provide valuable advice on a wide variety of financial and tax matters.

If time is running out, it is possible to file for time extension. But bear in mind that this is a quick fix measure. It only gives the small business owner more time to handle the tax matters appropriately. Datelines can be immensely pressurizing. To prevent shortage of time, always plan in advance.

Mostly, an accountant will be able to serve the needs of a small and privately held company. But some companies have the ambition of going public from day one. So they focus more on growth. It's just a matter of time that the business will grow to such a stage where the accountant finds it hard to cope.

The first sign that financial help is required is when the management staff has to deal with financial decisions on a daily basis. For businesses arriving at this stage, the business owners may want to consider hiring a chief financial office (CFO). Usually, the CFO will have several accountants and assistants working with him or her.

The primary role of the CFO is to provide professional financial services to a business that is raising large amounts of capital, or the business has intentions to go public. During the stage of transition, a part time CFO may be hired to oversee financial aspects of the business. Over time, as the business stabilizes, a full time CFO can be engaged.

The key here is to remember that the finances of a business should be managed on a regular basis, and not be left to the last minute. Otherwise, the task ahead will appear overwhelming and insurmountable due to lack of time. Hire the expertise that is needed as early as possible, and keep the books and records clear and organized. This will benefit small businesses greatly.

Resource: http://www.isnare.com/?aid=343915&ca=Finances

Higher Rates on Personal Loans for the Less Well Off By Sheila Challiner

Anyone who may fall into the lower income bracket and those with a poor credit record are going to have to pay higher interest rates, up to 19.9%, to enable them to borrow money for a personal loan.

It seems very unfair but it has recently emerged that the Nationwide Building Society, the largest in the UK, are basing their interest rates on the assessed risk of the individual client. Up until now, the system that has been used across the board within the industry has been very straight forward and rates have been based on the amount of the loan, not on the credit history of the borrower.

At Nationwide, as with many other lenders, the street cleaner or the lawyer, will not pay the same basic rate for a loan as before, but, the person with the smallest income will pay the highest rates and the higher earner who is likely to be financially secure will get their loan at a lower rate.

This trend has been implemented throughout many of the finance companies long before now, say Nationwide, and they are merely ‘jumping on the band wagon’.

At the end of the day, the final outcome is that those on lower incomes in our society will find borrowing much more expensive and harder to achieve – for some this could make it impossible to make a major purchase and for many, even harder to make ends meet.

In such troubled economic times the Nationwide say that they have to be cautious and cannot risk their finances against people who simply do not, or are not trusted to pay their debts. It is a time of major instability in the housing market with an increase in people losing their homes and also many becoming bankrupt.

Using the system of risk-assessed lending a well-off or low-risk person wanting to borrow 1,000 to 3,000 pounds would be charged at a rate of 15.9%, whereas the less well-off, high-risk customer would have to pay interest at a rate of 19.9% - quite a difference and in the cold light of day, compared to the Bank of England’s 2% base rate, 15.9% is plenty high enough.

As the amount borrowed increases, say to 5,000 to 7,500 pounds, the interest rate for the low-risk customer with a good credit history drops dramatically to 8.9%, but, for the high-risk borrower it only drops by 3% to 16.9%

Jeremy Wood, Nationwide's director of Consumer Finance, justified their move by saying: 'As a prudent lender in the current credit environment it is important that, in pricing personal loans, we are placing a greater emphasis on risk and lending appropriately.'

From the Moneynet website, Andrew Hagger, a personal finance expert said: 'The net effect is that the people who can least afford it end up paying more.'

The decision by Nationwide to follow suit behind other big financial companies has proved to be extremely controversial and very much on a tangent from the requests of other banks, Members of Parliament and the Government to be fair in their treatment of customers.

Plans have been revealed by Ministers to bring in a strict code of regulations for banks which will be regulated by the Financial Services Authority and legally enforced.

Resource: http://www.isnare.com/?aid=344199&ca=Finances