* Prepare ahead of time! The best way to get ready for tax season is to keep in mind that it is coming all year long. File your receipts and your invoices as soon as you get them and you will save yourself a lot of work in the winter time.

If you didn’t do so in 2007, 2008 is a great year to start!

* Schedule an afternoon just to deal with your taxes. You will need to spend a couple of hours at the very least (depending on the size of your business, of course) in preparing your taxes, and by the end you certainly won’t feel like doing anything else.

Make sure you block some time off, and give yourself a bit of a wind down afterwards!

* Keep everything organized. As you go through your records for the year, make sure that everything is filed in the right place. You probably already have your debits and credits separate, but you will want to sort out your debits further, into categories such as utilities, one-time purchases, research costs, office supplies, employee wages, and so on.

All of the different areas you can spend money on with a business are governed by specific rules, so you want to make sure and keep everything sorted out. Plus, make sure you know what small business tax write-offs are available to you!

* Hire an accountant! Big businesses have no questions about this, but often a small business or a business operated by an individual will be tempted to try to fill out all the taxes on their own. Don’t give in to the temptation! The fees you will have to pay an accountant are worth it; even the best business tax computer programs can be hard to follow and easy to mess up. Sometimes, they take hours just to figure out.

Even if you manage to get it done, you won’t really know if you filled everything out correctly; getting a professional to do the job could save you money in deductions you will miss, or even (God forbid) help you avoid penalties (read: audit) incurred by accident.

If you’re looking for an accountant for the first time, here are some tips for hiring an accountant to help you.

So now it’s time to go out and bite the bullet. Remember, this only happens once a year, so you might as well go and get it over with – and start working on your plans to make next years’ taxes a little easier to deal with.

What is Cash Flow?
Simply put, a cash flow ensures that you have money both coming into your business, and going out on time. It’s just like running your household budget, but the difference here is obviously the size of the budget.

Your business needs to have money coming in to survive, and this will come from your customers and business associates. However, a good cash flow will also mean money going out, so your accounts are kept up-to-date with suppliers and loans are paid on time. Failure to have a smooth cash flow could cause serious problems, not least the closure of your business. So you can see why it’s essential to have a constant flow of cash to ensure both sides of your business are met.

Problems to Avoid
Having a good cash flow is only the start. Once you have a system in place, like any system it needs maintenance. If you don’t keep up-to-date with what’s happening with your business’s finances, you could soon find yourself in too much trouble to get yourself out of. For example, if you receive confirmation of an order, you’re obviously going to have to pay for manpower and materials to complete the project.

However, paying for these overheads requires money up front, before completion of the order. And since you don’t get paid until the order is finished, you could soon find yourself out of pocket if you don’t have a steady cash flow to cover you until your customer pays you.

Set-Up and Maintenance of a Cash Flow System
To make sure you stay in control of your cash flow at all times, it’s important that you set up a cash flow system correctly in the first place. Additionally, making sure it’s easy to maintain on a regular basis is just as important. Thankfully, setting up a cash flow chart is as easy as knowing how to use Microsoft Excel.

By setting up two columns for your expenses – one for your incoming, one for your outgoing – you can see at a glance what the plus or minus figure is, and budget accordingly. If you’re not too sure about doing this yourself, you can buy accounting software that will do everything for you (read more about selecting accounting software ). If this is still out of your knowledge range, then look at hiring an accountant to run the financial side of your business for you (read more about finding an accountant ).

Maintaining your cash flow is just as simple, and all it requires is for you to keep the information up-to-date. Set aside a time of the week to input all your expenses and incomings for that timescale, and you won’t run the risk of forgetting simple amounts. With this system in place, you’ll be able to forecast your whole business year ahead, and plan accordingly