It’s that time of the year again, and we’re here to help you prepare
Tax season is near and for many small business owners, this means facing what can feel like the annual burden of figuring out your finances.
Whether your taxes are already prepared or you’re racing through a last-minute dash, we’ve got some handy tips to see you through.
Here are our 5 tips to get you ready for tax season
1. Get your records in order
As a small business owner, it is crucial that you keep up-to-date records of the year’s finances. If you can keep these records well-organised throughout the year, it will save you much time and stress leading up to tax season.
Maintaining a base level of financial organisation will help you to better manage the lodging of your tax returns and subsequently, to meet your tax obligations.
2. Know your tax deadlines
Sticking your head in the sand when it comes to tax deadlines is not going to help your business succeed. If you know when and where your taxes are due, you won’t be taken by surprise.
Having a rough estimate of what you owe can also help to keep you feeling in the loop and in control – rather than having the rug pulled out from under you when you’re lumped with a massive tax fee.
3. Learn about your end of year deductions
A financially-friendly part of having your own business is that a lot of your expenses can be claimed as a deduction. Anything from business travel (including fuel and flights) and employee wages to business-related tools and software and general operating expenses can fall into this bracket.
When it comes to tax deductions, be honest about it. Claim business expenses as business and personal expenses as personal. Which brings us back to tip number 1 – make sure that you keep a record of EVERYTHING.
4. Use software to track expenses
With automated software, you can collect and track your business incomings and outgoings. This will help you exponentially when it comes to collating your records at the end of the financial year.
Logging your transactions with automated software will save any confusion that can come with using a manual, more traditional inventory system. And it also allows you to go paperless – so you can save time on your taxes and save the trees, too!
Cloud technology is the future. Here at RBK, we use Xero – basically, the bookkeeping system of your dreams. With a qualified Xero accountant, you can say goodbye to data entry, and hello to automation!
5. Reach out for help & support
If you need help, don’t be afraid to ask for it. Finances can be tricky. If you don’t know anything about mechanics, you wouldn’t want to mess around under the hood of your car, right?
Nor should you tangle yourself up in your taxes if you don’t understand how they work. Whether you turn to a friend, a fellow business owner or a friendly tax accounting firm like RBK, there are plenty of avenues that can help you arrive smoothly (and sanely!) on the other side of tax season.
With the right preparation, you can face tax season with confidence
Getting through the tax season without drowning in your taxes is all about preparation. If you can organise and track your business expenses throughout the financial year, you’ll be much better prepared once taxes are due.