5 Ways To Prepare Your Startup For The Upcoming Tax Season
Tax season 2018 is coming up and there are many small business owners out there scrambling to try to find all of the records of their business costs and expenses throughout the year so they can get ready to file their taxes within the next month.
Tax preparation is a stressful task for many small business owners across Canada every year. However, the good news is that these 5 easy steps can help take some of the stress off of you as a business owner when it is that dreaded tax time every year:
- Keep Accurate Records Throughout the Year: If you are keeping accurate financial records of your business’s income and are also keeping an accurate record of your business-related expenses, you will have a much easier time when filing your taxes. You will know how much you owe taxes on and what can be taken out and counted as a “business-related expenses” so that you don’t end up paying more taxes than you owe.
- Use Software To Keep Track of Expenses: Using a detailed software program that keeps track of your expenses will ensure that you don’t just keep track of your expenses and deductions, but that you do so with some detail. Business expenses will need some documentation with them to prove that the expenses are legitimate and not fabricated before the IRS will accept them as tax deductions.
- Ensure Your Business is Properly Registered For Taxes: Ensuring your business is filed under the appropriate tax status to ensure that you are not paying more than necessary or that you are not missing out on deductions that you are entitled to. Understand and keep up on the information related to payroll taxes, sales taxes, and corporate sales taxes. Understand how these taxes work, what you owe, and how you can optimize your budget to ensure all of these said taxes are paid on time.
- Budget For Tax Expenses Each Year: It’s easier to pay taxes if you save a portion of your profit throughout the entire year (in a separate account) to pay for the taxes at the end of the year. This keeps you from having to scramble to come up with $100s or $1000s to pay these taxes every year when the government comes to collect.
- Hire Accounting Professionals: Hire someone who is a professional in accounting so they are able to help ensure that you are preparing and submitting your taxes correctly. This saves you as a business owner a lot of stress and headaches of wondering if you are even doing this whole tax thing right in the first place. Let those who know more about finances handle the finances, and you will find that it goes much more smoothly that way.
These are just a few great tips that can help your small business prepare for tax season and make it less stressful on you as a business owner.
For more information about making the preparing of your small business’s taxes less of a headache each year please feel free to contact us.
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