The Ten Top Ways To Minimise Your Small Business Taxes
We asked the top accountants in small business accounting for 10 smart ways to end up paying less taxes with your hard earned money. These accountants for small business gave us 10 simple ways you can save your money.
Here is the 1st part of a two-part article to help you to pay less taxes and save a ton of money.
The easy tips on this page are from small business Xero expert help you get into a few simple habits to make you cash from your taxes.
This is the 1st part of our 2 part article that can help you save large bucks this coming tax season.
Here they are.
1. Keep a good account of your tax records. (Use the correct method and it’s as simple as pie.)
Keeping your records is the #1 is the best way to be positive that your records are accurate (this will help at tax time, making the process easier). By getting yourself organized you can save more money.
It shouldn’t take more than five minutes a day for you to make sure your tax records are correct. It isn’t hard to to organize your records and it will save you time and help you save on your taxes.
2. Give Money
Did you realize that If you make a donation over $2 to a registered charity, it’s tax deductible? When you make a donation. be sure to get a receipt. When tax time comes around, add up your receipt from your donations – you will be able to claim it for a prior year tax deduction. Being charitable gives you big benefits at tax time.
Keep all your records in a folder, so when you need them you’ll have them at your fingertips. You’ll claim them as extra deductions and this will help you lower your taxes. There is one thing that we need to clear up about your donations. The donations that you show on your taxes won’t come back to you with your refund but they are deducted from your taxable income.
3. Stake Your Claim
Claim work related expenses like using the bus on your tax forms. This will increase your your total tax refund and you’ll pay less in taxes.
By claiming your deductions is a great advantage to do in lowering your total tax payment. By spending money throughout the year for your job, make sure you keep the receipts so that you can claim the deductions you have earned. You can deduct a proportional amount if you don’t use it all the time for work.
If you’re not sure that you are able to claim a specific item, still record and file the receipt, then prepare your tax forms with it in them. It’s better to save your tax receipt than to toss it away and learn that you could’ve included it.
4. Seek Advice from Tax Professionals
Tax laws change and in order to keep pace with the laws, you should consult a tax agent. By doing this, you save time and get it done fast. This is why ATO’s statistics show 70% of Australians will use tax agents service, like Etax.com.au!
They can fix little mistakes that would cost you money and they can advise you on your taxes, saving your more money and they operate at a low cost.
5. Medicare Levy Surcharge
If you don’t have a private insurance policy, and if your income is greater than $180,000 for families or $90,000 for individuals, you’ll have to pay 1% minimum of the Medicare Levy Surcharge. This is added to the mandatory 2% of the Medicare levy that almost all Australian taxpayers must pay.
6. You Are In Charge of When Your Claim Your Tax-Deductible Expenses
Knowing early that you’ll have a large, deductible expense, you may be able to choose which year you wish to purchase them in.
If you know your income is going to put you into a higher tax bracket you can plan to buy an item that will help you stay in your bracket. You may want to lower your tax bracket and be able to purchase more items.
Making a good investment will help you lower your tax. Speak to a financial adviser who can assist you with an investment that will benefit you. Remember that the investment that you make now must help you in the future rather than making the investment and losing it at a later date.
8. Based on Your Circumstances Adjust Your Finances
It might be possible, with your partner, to change up your finances to fit your situation. Example, if a married couple has money invested in some type of short term account that would earn a little interest, it may be to your advantage to invest with the lowest earner, that way you’ll pay less in taxes.
9. Don’t Skip the Small Stuff
Record everything you spend your money on. It may be a hassle but in the long run you’ll reap its benefits. If it’s $2 or $200 record it, you’ll be surprised how fast it adds up. This is one of the best ways to get the most out of your refund.
If you’re not sure if a purchase you’ve made can be deducted check with your Etax accountant for their advice. (Ask your question in the “My Messages” section of your Etax return).
10. Selling Off Assets
If you plan to sell assets which might be subjected to Capital Gains Tax, here are a few things that you should think about. If you owned your assets for 12 months or more, you might be entitled to a discount in Capital Gains of 50%. Also, you may decide to sell an asset in a specific year where you expect you will earn a lower income so that your Capital Gains will not have a big impact on your taxes.
Learn more from: business accountants in Melbourne