Tax planning is a year round endeavor but the last quarter is a good time to implement a few simple strategies that can substantially reduce your taxes. By adjusting your revenue and expenses, taxes can be deferred until the next tax year.
Start by Consulting with a Good Accountant
Business taxes and finances are complicated. To ensure your organization receives all the benefits it is entitled to, you should start by putting your books in the hands of an experienced professional. Companies use outsourced accounting departments to get the advantages of skilled financial management without the expense or management problems of an in-house accounting department.
An outsourced accounting department gets your company finances in order. They work with your business to come up with customized tax strategies optimized for your organization, your industry and the current tax laws. While the advice below outlines valuable strategies to position your company to pay the lowest taxes, tailoring those plans to your company requires the help of an experience accountant.
Increase Company Expenses
Any business expenses incurred in this fiscal year can be deducted on this year's taxes. This reduces your tax bill and gives your company a better cash flow. Any expenses that are planned for early next year should be examined to see if they can be moved up to appear on this year's books. If your organization is going to spend the money anyhow, and outsourced accounting department will tell you it's better to spend it in an earlier tax year.
This is also a great time to stock up on office supplies or buy new equipment. Obviously you should buy only items you need, but laying in an inventory now makes better financial sense than parceling out the expenses over the next year. If your tax bill is still a little high, increase your charitable donations. Many nonprofit organizations are in great need as the holidays approach and benefit from your generosity.
Defer Revenue
Another basic tax strategy used by outsourced accounting departments is to cut income. By delaying December invoices into January, you defer your income only briefly but postpone the tax liability until the new tax year.
This can be turned into a promotional opportunity by presenting it as a bonus to your clients. For example, credit card companies typically give their cardholders a "gift" for the holidays by allowing them to skip their December payments. The lender defers income until next year, makes more interest on a higher average account balance, and builds customer loyalty all with a single act.
You need to be sure the reduced income and increased expenses are within your company's means. To implement these strategies effectively, you need a clear understanding of your organization's financial picture. Working with an outsourced accounting department ensures you create a tax deferral plan your company can afford.
Author Resource:-
Author is a freelance writer. For more information on outsourced accounting department please visit http://www.osibusinessservices.com.
![[Valid RSS feed]](http://www.alltimeinfo.com/images/icon_Rss.png "XML Feed For RSS"){kind=icon}
Category Rss Feed
Print This Article
Add To Favorites
