Payment of tax is important to any business as it keeps the authorities off your back. If you want to avoid brushing shoulders with the tax authorities, you need to file your tax returns on time.
As a business with a permit, ensure that your taxes are paid on time for successful operations.
In most circumstances, there can be errors during this process and a business owner should make sure that they correct them as quickly as possible, or else they’ll attract penalties. You can for instance file your returns late and there are consequences to that.
As a business owner, you should be careful when making tax payments to avoid possible business tax mistakes. In this article are some of the things you should do to avoidmore the common business tax mistakes.
Make sure that you always check the deadlinethis website for filing business tax returns. As a business person, it is hard to always find time to check certain matters about your business because of your tight schedule.
That is why just as you have a day for paying your employees, you should also include in your records the day for filing your returns to avoid late payment of taxes.
You will be forced to pay a fine for late payment of taxes. You can thus have one of your employees to keep tabs on such important dateslearn more so that the business can operate successfully.
You should also avoid misclassifying your employeesmore about. In a business, if you hire a contractor to do a job for you, make sure you clarify whether they are independent or permanent employees in your organization.
How much you control a contractor will tell whether they are employees or independent contractors.
You will always have limited control over an independent contractor so make sure you do not misclassify them or else you will be caught on the hook for a lot of money. You should also make sure their salaries are classified separately when filing tax returns.
It is also advisable that you avoid mixing your personal and businesses expenses. This can be a real mess up and will cost you a lot of money to rectify.
Many people are fond of paying for all their expenses using the same credit card as it seems easier that way. But there are consequencesthis site for such when you have to pay taxes.
To avoid the audit process, you should always have a separate account for both your business and your personal expenses.
It would be best if you open separate accounts to make it easy for you when filing tax returns. If you choose to use the same credit card for both personal and business expenses, you should make sure you have the records of each expense.