If you are in the process of setting up your first small business and are concerned about the tax filing requirements, then these tips will ensure you have a lot less stress and frustration next April when it's your first time to file:
Tip: Stay on Top of Bookkeeping Tasks From Day One
The day you start your small business is the day you need to start staying on top of its bookkeeping needs. The best practice you can follow is to set aside a bit of time at the beginning or end of each workday to take care of bookkeeping tasks.
By working on your bookkeeping each day as you have expenses and income, you will prevent the need to spend larger blocks of time in the future trying to remember what you spent money on and what income you had.
Tip: Visit a Tax Professional Before Tax Time Rolls Around
While you may not want to spend the money right off of the bat to see a tax professional and discuss your future tax liabilities, this step is actually very important. By visiting a tax preparation services provider as your business is first getting off of the ground, you will have a clear understanding of the filing process as well as how much money you can expect to pay when next April rolls around.
This knowledge will give you a piece of mind because the small business tax filing process will be less of a mystery. Additionally, you will have a better idea of how much money is needed to save so you can pay your small business's taxes when they are due.
Tip: Claim the Home Office Deduction if Your Business Qualifies
If your small business will be housed in your home and has its own dedicated space, then by all means, take the home office deduction when you file your taxes. This is a great deduction that will lower the amount of taxes you are required to pay.
Tip: Use a Qualified Retirement Account to Lower Your Tax Burden
Finally, it's important to note that you should do everything you can to lower your small business's tax burden each year, and your first year in business is a great time to start this practice. One of the best ways to do so is to put as much of your income possible into a qualified retirement account. The more income you dump into a retirement account, then the lower your tax burden will be.Share
22 October 2018
When I started thinking about my life, I realized that I was spending a lot more money than I should be every month on little extras. I wanted to streamline things, so I decided to start focusing on getting my finances in order. I started looking around my house, and I was pleased to discover that there were more than a few things I could sell for a little extra cash. I put them online, and I was amazed to see how quickly they sold. After selling some things, I was able to get my finances in order, which was a huge relief. This blog is all about getting your finances in order.