Every business in the world—no matter how big or small—is answerable to the general process known as taxation. The year 2013 is a good timing for any start-up business due to the boom of technology and web development. Information also travels fast through World Wide Web, and the realm of social media has gotten firmer. If you have started a business in 2013, are you prepared for the taxation? In case you are not prepared, here are some tips that can help you settle your taxes so you will not get into trouble:
- Make sure your accounting system is intact
As a business owner, you cannot afford to have a lapse in your accounting process. This will cost hundreds and thousands of dollars and may lead to the downfall of your business. Usually, small businesses have easier accounting processes compared to large businesses. Are there uncertain transactions in your ledger? Is your bank not integrated with your financial sheets? How are you faring with your creditors? These are just some of the questions you have to answer regarding the accounting set-up of your business.Accounting automation can smoothen up the flow of everything. This is where online accounting software plays an important role. Instead of doing things manually, consider purchasing an accounting application so you can synchronize everything in a few clicks. - The more you care, the lesser the tax burden
If you care enough for your employees, you will have good tidings. This is more than just any old adage, and it can be expressed in numbers. After establishing your business, do not forget to apply for the benefits of your employees. Benefit schemes are better than traditional raises because they can reduce your task burdens significantly. Remember, the money saved from taxes can be used to fund other important areas of your business. - Ease up the inventory
Unused inventory will cause the appearance of maintenance fees in your accounting ledger. Aside from that, you can also be taxed if you have unsold inventory. To resolve this problem, you can donate it to different people and organizations. By donating those goods, you will get tax deductions. Just remember that any donation higher than the certain amount required will have greater reporting rules and regulations. - Initial business costs as capital expenses
Taxes are not harsh during the starting phase of any business. The challenges will only appear in the succeeding years, so you have to prepare. Before June 30, the money that you have spent in establishing your business is listed as capital expenses. This is a tax unburdening opportunity that can let you deduct up to $5,000. This is only applicable during the first year of your business. - Do not forget to write off bad debts
Writing off bad debts is a common technique for a tax break in the business world. Before writing off a bad debt, you should check your debts accurately. Reliable accounting software for businesses can help you pinpoint and segregate debts so you can note them down easily. After that, you should check out the requirements in writing off your current debts.
These common tax tips can help create a better head-start for your business. If you want to know more about other tax unburdening techniques, it is advisable to have a detailed research.
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