If you own a business, your profit is subject to taxes by the government, and usually, most business owners often lose much of their gains to income taxes. So, as a business owner, you’ll need to understand how to identify tax deductions relevant to your field of work.
Tax Accountants Gold Coast – Filing taxes can be one of the least exciting parts of owning your own business. However, taxes on a small business can be extremely painful without proactive tax planning. Here is some of the few tax deductions that could help you keep more of your hard-earned money.
- Business Meals
If the meal you purchased is related to your business, you can show bills of food bought and avail of a 50% cost deduction. However, to establish this relationship, you must record some details. These details should include the date, time, and place of the meal, its cost, and the name of the other person involved in the meal.
- Health Insurance
You may have observed that health insurance is expensive. However, If you have it, you can claim its premiums in addition to the costs related to medical care under this category. These expenses may include fees of Doctors, costs of prescription drugs, and other charges related to medical services.
Medical expenses make up a large portion of the costs for many individuals. So, it would help if you recorded your medical expenses precisely to avail of tax deductions for Small Businesses.
- Marketing Your Business
As a business owner, you can avail yourself of tax deductions for the money you spend, making people aware of your business. This may be in advertising, networking, search engine optimization, your website, conferences, or traditional marketing. However, you’ll need to establish the relationship between these expenses you make and your business.
- Business Related Insurance
Most small businesses require some insurance, and some may even need to have several types. These could be errors and omissions, malpractice insurance, liability insurance, and workers’ compensation insurance. You can deduct all these business insurance costs from your tax returns, which can help you significantly reduce the small business tax. If you have an office at your home, you can write off the insurance cost incurred by the renter from your tax returns. Note that insurance premiums are deducted separately from your health insurance premiums.
- Home Office Deductions
To be eligible for the home office deduction, a part of your home must be used “entirely and regularly for your trade or business,” and that portion of your home must be your principal place of business.
The amount that can be deducted for your home office is calculated at a rate of $5 per-square-foot of your home office. This deduction can be valuable. However, ensure you keep documents of expenses and which portion of your home you use exclusively for business.
I get it; tracking tax deductions can be stressful and less exciting for most people. But if you think of how much less you would have to work if you could significantly reduce your taxes each year, you’ll have no choice but to consider it. To get the maximum tax deduction to pay the minimum taxes, you must proactively track all your tax-deductible business expenses.
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