For many small business owners, the first week of April doesn’t just mark the beginning of a new tax year and payroll year, but also the start of a new accounting year. FreeAgent’s Chief Accountant Emily Coltman FCA explains why this is such a great time to switch to new accounting software and make some positive changes for the year ahead.
For most sole traders and many limited companies early April is the start of a new accounting year, and it’s also the start of a new payroll year for any employers. The new accounting year is the point in the year when accounts from the previous year are being finalised and you’re starting afresh for the new year.
At the start of a new accounting year, the amount of information you need to input into a new accounting system is much less. Instead of importing many individual transactions, you’ll be able to take the closing balances from your previous accounting year and use these to create the opening balances for your new year. The details of your closing balances should be readily available from your accountant or from your existing software system, if you’re using one.
Read more about switching accounting software.