Accounting For Tech Companies

You might be surprised to learn what tech startup accountants can bring to the table.

For instance, many tech startups might not be aware of what they have in intangible assets — read on to find out more.

Tech startups can benefit heavily from the advice and guidance of a chartered accountant. Sound management of your finances is crucial, especially early on in your business’s life. Accounting for tech startups isn’t overkill — it’s simple, sensible practice.

You could be eligible to claim R&D tax credits, under HMRC’s scheme.

The value of what you can claim will depend on what you spend on eligible R&D, which is why you should track and record this accurately and efficiently.

There are various costs you can claim for, including:

• Consumables
• Prototypes
• Software licenses

However, there are also eligible costs that might be less obvious, such as salaries, contract workers, and pension funds.

Your claim needs to fall within two years of the end of your current accounting period and you’ll need to make sure all the relevant documentation is present and correct.

Having a dedicated tech startup accountant will make the whole process easier, from tracking and recording R&D costs to claiming relevant tax credits.

Many tech businesses experience rapid growth, which puts demands and stresses on their existing structures.

Like other growing companies, they must consider how best to administer payroll.

Often, with a focus on tech and innovation, the mechanics of general management take a back seat, but your payroll procedures and practices must keep pace with your business development.

Our accounting services for tech startups and tech companies include professional payroll management support.

For many tech companies, the activities they carry out will mean they develop intangible assets.

Intangible assets include things such as branding, technology, software, and patents which all hold value but aren’t always counted alongside assets like vehicles and property.

For accounting purposes, it’s important to value them accurately and appropriately.

For example, a tech company can recognise its intangible assets as development costs and capitalise on this, creating an asset rather than a cost on the balance sheet. To do this, intangible assets must meet certain criteria.

If you want to maximise the benefits of your intangible assets, then our professional accounting support will help you do this.

The most common issue tech startups and other SMEs face is cash flow.

Cash flow problems can start with late payments or sales issues. But tech startups can also face difficulties in establishing their credentials simply because they are innovators in their field.

It’s difficult to find willing lenders if your accomplishments are in the future.

The best way of improving cash flow is to put a management plan in place, including a perpetual cash flow record.

By planning working capital better, tech companies can mitigate their cash flow problems.

Good accounting support can help tech companies manage their cash flow as they develop and grow in confidence.

Do you need to call on the expertise of a dedicated tech startup accountant?

At Venn Accounts, we pride ourselves on communicating clearly, using language that is free from jargon or complex terms, so that you grasp what we do and how we’re benefitting your business.

We keep things simple, but want our customers to feel assured that they can count on our guidance at every stage.

Whether it is tracking R&D expenditure, valuing assets appropriately, or managing payroll, we have a specialist that can help.