5 Vital Tax Tips for Small Companies as the Tax Year Ends

calculator-1680905_640It’s official: small companies and businesses find it more difficult to cope with tax planning and filings than individuals or large corporations, but that should not cause you panic. There are ways to stripe tax organization and accounting off their monstrosity.

Sailing in the same boat myself, I’ve seek the advice of skilled CEOs and renowned tax experts and accountants, and I have discovered certain accounting and taxing secrets that can really help small entrepreneurs free themselves from tax return nightmares and alleviate their stress.

I have chosen among them the 5 more important, having mainly in mind what’s more vital as the tax year is about to end.

1. Preserve your records in excellent condition.

It’s more than essential to put all accounting documents in a file. Do not throw away any receipts, irrespective of their amount of money, as well as invoices, account charts, and all relevant documentation that pertains to any aspect of your business.

Everyone I spoke to also recommended preserving my records in excellent condition throughout the whole year. Despite the fact that the majority of small businessmen do not tend to their tax records before the end of the year, or even well after January, the best practice is to start keeping your records right from the start, like a New Year’s Eve custom. Lay down your business tax planning and start working on it immediately, without forgetting to properly arrange all relevant documentation for every single month.

2. Organization means everything.

Lack of proper organization in their accounting paperwork is at the root of several significant accounting errors in small companies and businesses, especially when they are about to file their tax returns. Just as you ought to preserve pristine records throughout the whole year, you should also make sure they are properly organized.

You could start by arranging your bank statements. Then sort operational cost receipts or invoices and enter corresponding information to an accounting software that will automatically calculate all relevant sums, having them ready for you when the time of tax return filing comes.

Getting well organized will avail a lot for you, at least based on my experience.

  • First of all, it will facilitate your filing.
  • Second, it will surely lower the chances of an unexpected audit,
  • and third, since audits are always possible, it will be much easier for you to find and present all the necessary documentation and records as soon as they are requested from you.

Thus, getting and remaining organized is of the essence for unblemished filings and rare audits or at least easily handled.

3. See whether you can handle tax issues by yourself.

There are indeed certain small business owners that are fully capable of tending their company’s tax issues and accounting just by themselves.

Several small businesses with a small number of employees lack the means of hiring a tax professional, or do not even need one. If you are well organized, you know exactly which operational costs can be deducted and are aware what exactly to file and where, or in case you already have an employee that knows how to handle these things,  you may indeed need no help at all.

4. Discern when you need help.

On the other hand, most tax experts told me that for any business involving more than two or three persons it’s safer to ask for professional help.

Trying to do all by yourself, when you actually can’t, will cost you valuable time, effort and raises the risk of making some serious mistakes that can cost a lot.

Instead, consider hiring an experienced tax professional that will sort everything out in the best way possible. The stress relief will easily compensate his fee.

Bear in mind that you might also find better options in other countries, offering more lucrative benefits. For instance, the island of Cyprus, which is well known for its low corporate tax rate of 12.15%. Make sure you explore this option and find out more about tax planning and consulting in Cyprus.

5. If an audit is at hand, don’t panic!

In such a case, you surely need a tax professional and a skilled one too. Do NOT even think about dealing with an audit by yourself.

It’s like being taken to court and not having a layer. An experienced tax professional will know the whole process and will find ways to protect you and ensure for you numerous tax benefits.

Save More Money in 2018

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