The end of the year is upon us. Although the holiday season offers a chance to relax and share with family and friends, it also brings with it a few unique responsibilities–especially for business owners and the self-employed. This is because, assuming your company uses the standard tax year, your days for making last-minute decisions that will impact your taxes for the entire fiscal year.
Here are a few factors that you should consider:
Tax Tip #1
Invest in the future. You have to spend money to make money, goes the old saying: investing in new equipment, vehicles, buildings, storage, or software is always an important consideration for business owners, as these are the tools that can help to increase future profitability. At the end of the year, such purchases take on a particular importance: any purchase you make before January 1st (or before whatever date you have selected as the end of your company’s tax year) will be deductible from that year. With wise management, this can help you optimize your investments while minimizing your tax expenditures.
Tax Tip #2
Defer income. On a similar note: speak with your account (and possibly your clients or vendors) about deferring any payments due to you until the new year has come. Deferring payments will reduce the total amount of gross income that your company has made during the tax year, lowering the amount of taxes you will owe, and possibly even pushing your business into a lower tax bracket.
Tax Tip #3
Get organized. The end of the year is a great time to organize your records and to plan to get more organized for the upcoming year. This will help you catch any discrepancies well before the March or April tax deadline, while also making your job a year from now that much easier.
SMe Software’s tools can make your business’s payroll, record keeping, and tax filing more efficient. Visit us online today to learn more.