Financing your Business

Every business needs money to survive, and every business must pay taxes on its earnings. Managing your finances and taxes can be very complicated.

Financial planning
Of course you need money to start your business, but raising capital is not always easy. Before you can begin the process you must plan for your business's financial future. Even if you know where your financing is coming from, you need a plan to manage it. Things you can do include writing a business plan, figuring start-up costs, creating an operating budget and drafting financial statements.

Getting financing
One key to a successful business start-up and expansion is your ability to obtain and secure appropriate financing. Raising capital is the most basic of all business activities. Capital can be raised in a number of different ways, including through bank loans, venture capital, private placement and the sale of stock.

Tracking business income and expenses
As soon as you start your business, you must have an accounting system in place to keep track of your income and expenses. As well as giving you an idea of how your business is doing, a good accounting system will be an asset when you organize your taxes.

Taxes
Taxes are never fun, but they are a necessary part of doing business. As a small business owner you may have to pay income tax, employment tax and self-employment tax. Fortunately, many of your expenses may be deductible.