Organising expenses receipts can save you money on business income taxes. Sounds too simple, but the truth is most people are not very organised when it comes to filing receipts and keeping records updated for tax purposes. Here are four reasons you should start organising information for next years’ tax returns, and how organising receipts can save you money:
1. You Will Do Your Taxes Sooner
Filing taxes on time can save you money because you will not have to pay penalties for filing late. You are more likely to keep putting off preparing your taxes if you do not have everything right in front of you. No one likes digging for receipts. Then there is always that nagging feeling that some receipts are missing and the temptation to put off filing to give yourself more time to find missing receipts. Here are some tips to getting better organised: file receipts as they come in; set aside time each day or week to enter receipts, and; mark them as they are recorded/entered.
2. You Will Save Money
For every expense receipt you cannot find, you will pay more in tax dollars. Many business expenses are tax deductible - for every one you miss, you pay more on income. If you ever get audited you must have the receipt to prove the expense. Give us a call, or book an appointment to see if you are taking all the deductions allowed.
3. You Have More Time To Budget For Taxes You Owe
If you owe taxes, and wait until the last minute when taxes are due, you have less time to set aside money to pay them. Many business owners are surprised at the end of the year when they discover they have to pay a lot more taxes than anticipated.
4. You May Get A Refund Sooner
Yes, it does happen sometimes. If you overpaid and are due a refund, the sooner you file your return, the sooner you will get your refund.