It’s almost the end of the year – no, not the calendar year – the fiscal year. This can only mean one thing: your business needs to start thinking about filing its taxes. It also means that your business has to prepare its books and find ways to save money. On a bootstrap budget, your business’ tax responsibilities could take a big chunk out of your operating capital, so you want to find a way to write off as much as you can – in a legal and responsible manner. When it comes down to it, there are a lot of ways to make tax time less of a financial burden. Here are five small business end-of-year tax planning tips.
- Make sure that your business’ numbers and books are up to date and accurate. Making sure that all your records are straight, organized and ready to be reviewed by your accountant is incredibly important. The last thing you want is find your business scrambling to prepare its books during the eleventh hour. Plus, you don’t want to be late on your taxes, because you could be incurring fees.
- Move large payables and employee income to after the tax due date. By scheduling payables and payroll after the end of the fiscal year, you can actually save your business a lot money. When it comes down to it, these large payables can actually be taxed, so if you are looking for ways to save money, making sure to defer or postpone these payments can help your business avoid paying taxes on those expenses until the next tax filing season. While you don’t want to be late on paying your employees, you can find ways to rearrange your payroll schedule to save money on last year’s taxes.
- Purchase office equipment and other items that your business needs to run and operate. Every piece of office equipment that you purchase can be deducted from your overall tax return. If you want to increase the number of deductions on your tax return, you may want to start purchasing office equipment before you actually have to file. You may also want to start paying your outstanding vendor balances too.
- Hire a qualified tax preparer. When it comes down to it, having a qualified small business tax planning team, like Bowman & Company, can be incredibly important. When it comes to saving money and understanding complicated tax laws, only a certified tax planning company can work along side your company to break down your books and file your business’ taxes the smart way. Plus, handing off the responsibility of preparing your business’ taxes can allow you to focus on running your company.
- Make donations to charities. Not only is giving to charity the conscionable thing to do, but it will also give you items to write off on your taxes. So, you may want to start researching charities now. You may even be able to tie in your charitable giving into your marketing strategy, which can be a double win for your small business.