10 Steps You Should Take Before Planning End-Of-Year Tax

Tax
23 Jul
2019

At the end of every tax year, there is a shining opportunity for you to save your money that goes into taxation using timing, right deductions and making expenditures on certain prescribed items.

This post will help you understand all such tax-saving possibilities. Using these opportunities, you can manage to save a lot of money from being cut in tax. Any reliable tax advisor in Croydon would recommend you these tips.

Let’s begin.

1. Interact With Your Tax Advisor

It is imperative that you have a live and one on one relation with your advisor. If possible, meeting them in person is the finest way to handle things. However, you can also approach them via telephone, or online.

Make sure that your tax picture year-to-date is reviewed by your CAP or any other tax advisor so that you are able to make the right moves before the end of the tax year.

2. Engage in a last-minute equipment purchase activity

If your business requires new equipment or the current one needs replacement, now is the time to make this move. By purchasing the equipment, you can comfortably write the cost off to a great extent. This is despite the fact whether you finance the purchase fully or partly.

3. Get a new vehicle

If you need a new vehicle, you may be enticed with those famous year-end sales. Also, the tax written offs will influence your decision. There are quite impressive tax deductions allowable under tax schemes at the end of the year.

4. Manage Income/Expenses through Year-End

For businesses who report on a cash basis, there is some flexibility in terms of reporting income and expenditure. For example, you can delay invoicing for the service you render in December. This will allow you to receive payment next year reducing the current year’s tax liability.

5. Consider paying year-end bonuses

Bonuses are considered an important source of relief in corporate tax planning In Croydon. If you have had a good year, share the fortune with your staff. However, don’t forget to consider the cost of payroll tax when decided the amount of bonus.

6. Making a retirement plan

If you haven’t any profit-sharing plan yet, do make one! This will extend the date allowing you to comfortably make the deductible contributions.

7. Doing charitable contributions

Amount to be deducted is governed by certain tax rules. It varies with what you give. By making charitable donations, you can indeed receive a tax deduction up to a curtained percentage of the income. The donations are considered an important part of corporate tax and planning in Croydon.

8. Addressing the S corporate concerns

In case the year has not been good for you as an S corporate owner, you’re allowed to deduct losses passed through you only to the extent of your basis in the stock.  By increasing the stock, you can manage to write off the loss completely.

9. Adjusting Estimated Taxes

You must consider the impact of the year-end moves on your estimated taxes. This will save you the trouble of having to wait for the submission of your tax return to claim the refund.

10. Consider Tax Reform

You may want to keep an eye on what’s going around you. Your tax specialist in Croydon may guide you if there are any changes in the political government, you should be expecting tax reforms and changes. Keep an eye open for them!

Leave a Reply

Your email address will not be published. Required fields are marked *