Paying taxes is inevitable. It is your duty as an Australian citizen to pay taxes to the government. Your taxes are used for your betterment so there is no reason why you shouldn’t pay them. However, this doesn’t mean that you can’t save up on your taxes. The Australian government has been very accommodating and has been facilitating businesses in the country when it comes to paying taxes. They have given ample ways for a small business to cut down the tax money it has to pay. However, you need to be smart enough to identify them and file your taxes accordingly. In this article, we will discuss strategies that can help you in paying less tax.
Claim Deductions Wherever Possible
The Australia Taxation Office (ATO) gives small businesses the chance to claim deductions for any business-related expense. For instance, if you bought a piece of machinery that is integral for running your business then you can claim this expense as a deductible. The amount you spent on purchasing the machinery will then be deducted from your assessable income, thus lowering the amount of tax you would have to pay. Aside from any business-related purchase, other operating expenses that can be claimed as a deduction include advertising, utilities, rent, and wages. Do keep in mind that you would have to provide proof of purchase or a receipt in your tax returns if you want to claim the deduction.
Putting Money in Superannuation
Any money you put in your superannuation is termed as an investment and you can claim a deduction on it in your tax returns. Thus, it is a good idea to invest money in your superannuation instead of putting it in a savings account. However, it is important to note that deductions can only be claimed for making contributions to a complying super fund. Also, you need to meet the age restriction for claiming this deduction which currently stands at 75 years or less. The cap for claiming deductions on superannuation contributions is $25,000. So, there is no point in exceeding this limit.
Hire a Good Bookkeeper
Most small business owners find little to no time for managing the financial aspect of their businesses. This is why they end up paying more tax than they have to. Hiring a good bookkeeper can solve this problem. Experienced bookkeepers are well-versed in financial matters and know how to file tax returns. They can ensure that all the deductions you can claim are mentioned in your tax returns. Moreover, bookkeepers can keep track of the receipts that are needed for making the deduction claims. So, hiring a good bookkeeper is a good business decision that is ultimately going to save you a lot of money.
Shoebox Books is a well-known online bookkeeping service in Australia. If you want to save money on taxes by hiring a good bookkeeping service then give us a call right away.
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