Top Tax Tips for Small Businesses

Maintaining good tax and accounting records and preparing your own tax return are major jobs that can take considerable time and effort. Small business owners are usually so busy running their businesses that these tasks can be neglected and they may not always have the budget to employ a chartered accountant. In London and other major cities in your region look out for government funded Business Hubs that will often provide some free information to give you a helping hand with tax affairs. If you do not completed your paperwork fully and accurately you could end up costing your business a significant amount of money in fines and interest on unpaid taxes. Keeping that in mind, take a look at these top tips for making your business more efficient with regard to all issues relating to tax.

Keep a separate bank account just for tax

It is essential to open a distinctly separate bank account into which you transfer regular amounts to cover your tax bills. Depending on when you get paid by clients and customers set up a periodic automated payment. This will help with controlling your cash flow and ensuring you have sufficient funds once your tax bill arrives. If you keep funds intended for tax payments in your main business bank account it is all too easy to spend that money before the bill arrives then receive a nasty shock and risk potential fines if you are unable to pay the full amount.

Tax Tips for Small Businesses

Use tax efficient payment schemes

Companies that are set up with one or more directors can often pay the directors a basic salary and then their remaining income can come from dividend payments (assuming the company has adequate profit to issue a dividend). This does not affect the amount of corporation tax a company will pay but it will minimise the amount of personal tax that the directors have to pay and happy executives make for a happy company.

Claim back Value-Added-Tax (VAT) on bad debts

If any client defaults on a payment then your business will not want to have to pay VAT or sales tax on the unpaid debt, particularly since you will already be out-of-pocket. So remember that for any invoices remaining unpaid after 6 months the business can reclaim any sales tax or VAT that has already been paid.

Take advantage of free advice from an accountant

Whilst your business may not be able to employ a highly qualified chartered accountant, especially if you are based in London or some of the other very expensive cities worldwide, there are still various government-backed initiatives designed to help start-up businesses, often with free accounting and tax advice available. However, accountants and tax advisers can be more affordable than you might think and a fixed-fee accountancy service can help budget effectively for these costs. What many business owners soon realise is that an accountant is one of those costs worth paying for the peace of mind that all your tax affairs have been handled correctly; that you have paid the right amount of tax – neither too much nor too little.

There are also many ways in which an accountant can save you money because they are familiar with all the current tax-reliefs available, and hence can easily cover their fee in the tax savings they make for you.

What Kind Of Benefits Payroll Solutions Offer

Advanced technology is allowing businesses to use different approaches to reduce costs, seek chances for growth and outsource tasks that are not tightly related to the main goals business has. Modus operandi of every business is changing because there are many business solutions that are constantly being offered on the market. This evolution is something we have to get used to. Actually, we have to follow it or else our business can be left behind.

One of many solutions that changed businesses all over the world is payroll solution. Internet and technology have come together to improve businesses and now there are hundreds of payroll solutions available for anyone who is interested to use one.

Company’s operations have to run smoothly and anything that can with streamlining is more than welcome. It’s hard to say how much resources a specific company will have to invest just to take care of the payrolls. It all depends on the size of the business. But what’s certain is that if the payroll activities are outsourced, the cash flow will improve, bottom line will improve and there will be more room for the business to pursue it’s main goals.
Payroll SolutionsMost Important Benefits

When a certain company decides to outsource payroll solutions, it is no longer necessary for the company to train the employees and get familiar with the new systems. Everything that needs to be taken care of in that department will be done by the payroll service provider – http://www.payroll-solutions.co.uk/. All systems will be updated and they will be perfectly suitable to handle all payroll requirements the company has.

Any company that decides to hire a payroll service will be able to reach payroll solutions at any time. Reports can be made from anywhere, at anytime since everything is online now. And the service provider will take care of the security, will regularly backup the data and provide all the necessary tools for the company so that it can focus on what’s important the most.