With only small profit margins to sustain them, many small businesses are obliged to count their pennies and manage on a very tight budget. That’s why you don’t want to pay any more business taxes than you absolutely have to, so you should always be on the lookout for allowable deductions. Here are some ways that you can save money on your business taxes, so you can keep more cash in the company and improve your chances of survival.
Make Use of Tax Filing Software
Most small business owners don’t sit down and calculate their own business taxes, preferring to allow an accountant to manage that for them. However, even accountants may be unaware of all the latest allowable deductions, or they can miss things which you might have been eligible for. Tax filing software has all these things programmed into it, so you’ll be much less likely to miss any deductions in your business taxes.
Save All Your Receipts
All small business owners are aware that receipts saved throughout the year will provide the basis for a great many deductions at tax time. It might be a hassle to save those receipts for an entire year, but it will be well worth it in terms of the money you save on your business taxes.
Deduct Your Home Office
Quite a few small business owners operate directly from their homes, but not everyone realizes this can be a major deduction. For instance, when you operate from home, you’ll be able to deduct utilities like your Internet service, mortgage interest payments, and even home insurance.
Deduct Automobile Expenses
As with your home office expenses, you would have to calculate which portion of your automobile usage is directly related to business activities. This percentage can then be applied to a deduction for your business taxes. You can either use the IRS standard mileage rate, or you can deduct the actual automobile expenses you incurred during the year, relative to gas, insurance, and necessary maintenance.
Need Funding to Pay Your Business Taxes?
It can be a major shock when you calculate just how much your small business owes in business taxes. Contact us at Aspen Commercial Lending if you are in need of funding to manage your business taxes.