If you're planning to start a small business, it is important that you understand the business taxation system. Tax accountants can help you with the taxation aspect of setting up your business. It's important that you file your tax returns on time and accurately to remain in compliance and to avoid costly penalties.
For the most part, your business is taxed based on how it was formed. A company is basically liable or subject to what is called corporation tax. Corporation tax is charged on all profits arising from the business operations.
Trading income is taxed at 12.5% whilst non-trading income is taxed at 25%. Consult with your trusted tax accountants to learn more about applicable taxation rates for your business. Computing exact taxes up to the last penny can be a complex process when other factors are involved such as when the rate changes during an accounting period. Also, you must factor in expenses that can be set against your profits and thus result in tax deduction.
There are not enough hours in the day - You have to take the time to learn about all the nuances and features of tax software, which you may not have the time or inclination to do. It takes a lot of effort to finish these taxes on your own, and you might even miss a few rules that could hurt you in the long run. It is no surprise that most people without a tax accountant while away hours investigating the tax laws that pertain to them, when a professional can have it done in an hour at most.
Business taxation becomes a lot more complicated if you take on employees. You need to calculate and deduct tax due on your staff's salaries based on the pay-as-you-earn or PAYE system. Although there are government incentives for employing people, always consider your business requirements first.
On the other end,if your business is not incorporated and you are operating as a sole trader, you are subject to personal taxation. If you are running a small business as a sole trader, profiting from rent, investment income, foreign income and similar incomes, you are to pay and file your tax returns on a specific filing date.To ease your burden of computing business taxes, filing returns and paying taxes on time, it's best that you hire tax accountants whether you are a sole trader or a company.
For the most part, your business is taxed based on how it was formed. A company is basically liable or subject to what is called corporation tax. Corporation tax is charged on all profits arising from the business operations.
Trading income is taxed at 12.5% whilst non-trading income is taxed at 25%. Consult with your trusted tax accountants to learn more about applicable taxation rates for your business. Computing exact taxes up to the last penny can be a complex process when other factors are involved such as when the rate changes during an accounting period. Also, you must factor in expenses that can be set against your profits and thus result in tax deduction.
There are not enough hours in the day - You have to take the time to learn about all the nuances and features of tax software, which you may not have the time or inclination to do. It takes a lot of effort to finish these taxes on your own, and you might even miss a few rules that could hurt you in the long run. It is no surprise that most people without a tax accountant while away hours investigating the tax laws that pertain to them, when a professional can have it done in an hour at most.
Business taxation becomes a lot more complicated if you take on employees. You need to calculate and deduct tax due on your staff's salaries based on the pay-as-you-earn or PAYE system. Although there are government incentives for employing people, always consider your business requirements first.
On the other end,if your business is not incorporated and you are operating as a sole trader, you are subject to personal taxation. If you are running a small business as a sole trader, profiting from rent, investment income, foreign income and similar incomes, you are to pay and file your tax returns on a specific filing date.To ease your burden of computing business taxes, filing returns and paying taxes on time, it's best that you hire tax accountants whether you are a sole trader or a company.
About the Author:
Frank Miller has a Debt Consolidation Blog & Finance, these are some of the articles: Minimize Your Family's Taxes By Hiring Your Children You have full permission to reprint this article provided this box is kept unchanged.
No comments:
Post a Comment