Starting a small business is exciting. You get to follow your passion, be your own boss, and build something meaningful. However, while juggling sales, marketing, and customer service, many small business owners overlook one crucial part of their operations: accounting.
It’s common to ask yourself early on, do small businesses need an accountant? Especially when money is tight, it can be tempting to DIY your books or rely on basic software. But without the right financial guidance, small issues can turn into big (and expensive) mistakes.
Let’s discover why having an accountant from day one is one of the smartest moves you can make when running a small business.
The True Cost of “Doing It Yourself”
Many small business owners begin by managing their accounting using spreadsheets or entry-level software. While that might seem fine at first, it doesn’t take long before things get complicated.
Small business owners often make these mistakes when they don’t have an accountant:
- Missing tax deadlines or underestimating tax payments
- Failing to register for GST or PAYG withholding on time
- Confusing personal and business expenses
- Incorrectly establishing business structures.
- Overlooking deductions and allowances, they’re entitled to
These mistakes do more than cause stress—they can result in penalties, audits, and possible legal issues. An experienced accountant can help ensure you’re compliant with Australian tax laws from day one.
Even more important? They distract you from your core focus — your products, your clients, and your team. That’s why it’s so important to focus on growing your business, not just managing the books.
So, Do Small Businesses Need an Accountant?
In short, yes.
A good accountant doesn’t just “do your taxes” — they’re a key partner in supporting your business success.
Here’s how an accountant adds value from day one:
1) Correct Business Setup
An accountant can help you choose the right structure (sole trader, company, trust, partnership) from the beginning. This affects your tax obligations, personal liability, and how you pay yourself. A well-organised setup also facilitates better long-term financial planning.
2) BAS and Tax Compliance
Australian businesses have strict requirements when it comes to BAS (Business Activity Statements), Instalment Activity Statements (IAS), and tax preparation. Accountants ensure you meet your obligations and avoid costly fines.
3) Cash Flow & Financial Strategy
Cash flow is the lifeblood of any small or medium business. Accountants can help you plan, manage your outgoings, and prepare for seasonal dips or growth opportunities. This type of financial advice helps strengthen your financial health and long-term stability.
4) Cloud Accounting Tools
Modern accountants also help you use the right digital tools. Platforms like Xero or MYOB streamline bookkeeping and simplify reporting. In one accounting firm, for example, the team works closely with businesses to implement cloud-based accounting and cloud accounting software that fits their business needs and simplifies day-to-day management.
5) ATO Communication
Ever tried calling the ATO during peak tax season? It’s a nightmare. A good accountant can deal with the ATO for you, handling lodgments, and resolve any disputes or queries quickly and professionally.
6) Strategic Planning and Valuable Insights
Accountants do more than just crunch numbers. The best ones use your financial data to deliver valuable insights and guide effective strategic planning. They help you set clear goals, understand your breakeven point, and grow your business with confidence..
Think You’re “Too Small” to Need One?
It’s a myth that only large or established companies need accounting help.
Small business owners and startups often stand to gain the most from early advice. Why? Because they can avoid forming bad habits or making costly structural decisions that are hard to unwind later.
Many business accountants, like those at Bruce Edmunds & Associates, specialise in working with small to medium businesses across Melbourne and Beaumaris. They understand the unique pressures and provide personal, plain-speaking guidance that grows with your company.
How to Choose the Right Small Business Accountant
If you’re ready to get accounting support, here are a few things to look for:
- Experience with SMEs: Choose someone who works with businesses of a similar size and industry to yours.
- Cloud expertise: They should help you move to (and understand) cloud-based accounting
- Upfront fees and ongoing advice: Look for an accountant who offers value year-round, not just during tax season.
- Local support: Having someone who understands your local laws and regulations is a big plus.
Accounting Isn’t a Cost — It’s an Investment
You wouldn’t skip insurance, marketing, or inventory planning. Accounting should be no different.
Getting professional accounting advice early can help you:
- Stay compliant
- Maximise deductions
- Understand your numbers
- Make smart decisions
- It saves you money in the long run.
So, does your business need an accountant? If you want to avoid mistakes, reduce stress, and build a solid foundation from the start, the answer is a clear yes.
Ready to hire an accountant for your small business?
This guide on whether small businesses need an accountant shares practical insights on how expert support can save time, improve financial outcomes, and set you up for long-term success.
