Making tax plans for the end of your business’ financial year
If you're going to run a successful small business, you need to have a rock-solid strategy in place for managing your tax burden every year. This means having a good command of all the basic knowledge – how much money your business venture is making, what taxes you'll owe and how you'll handle the cash flow logistics of paying them.
There are some strategies you can use to minimise the financial hit you take when tax time rolls around.
To a large extent, there isn't much you can do about taxes. You have to pay them every year, and there's no getting around that. What you owe, you owe. Having said that, there are some strategies you can use to creatively minimise the financial hit you take when tax time rolls around.
You don't have to break the law to break even. With some creativity, you can have a happy and healthy tax season without doing anything untoward.
Know what you can and can't do
When it comes to handling tax services in Australia, you only have a certain level of control over how much you pay and when. It's illegal, obviously, to misrepresent your income to the Australian Taxation Office and evade taxes on what's yours.
The ATO does grant, however, that you can use some creative tax planning strategies to control how much you owe. For example, you can move some of your wealth around among your friends, family members or business partners in an effort to move into a lower tax bracket and ease your burden a little bit.
Get creative about timing
One common wealth management strategy that people love to use around tax season is to adjust the timing of their financial transactions. For instance, say you're interested in buying a piece of real estate, but you're flexible about when to do so.
According to Property Tax Specialists, it makes sense to complete your purchase late in one fiscal year, then file your taxes early in the following year. This way, any tax credits or deductions you earn will come soon after your transaction. This doesn't affect how much money you make ultimately, but it does improve cash flow. You don't have to sit around waiting a long time to reap the benefits.
Find best practices for true growth
Growing your financial clout, either as an individual or from a business development standpoint, is hard work that requires careful planning. At Wilson Porter, we have a team of consultants on board who can help with that planning process, guiding you through the financial landscape with ease.
This can be helpful at any time, but it's especially valuable to have a little bit of extra guidance when tax season comes. Give us a call if you find the need – we'll be ready to lend a hand.