5 Ways to Maximize Your Small Business Tax Return
When tax season hits, many self-employed individuals and small business owners scramble to prepare their financial records and statements. Unfortunately, even the most responsible and organized business owners can overlook the lesser-known tax deductions and credits that are available. Work with the team at Hurren Sinclair MacIntyre LLP, who can streamline the process and help you understand all the nuances of tax planning.
Regardless of the industry or size of your business, paying your taxes at the end of the year is an absolute certainty. However, a tax refund is not always guaranteed. Tax rules are constantly evolving and it can be a challenge to understand all the complexities on your own. If you need assistance from a tax accountant in Ajax, we can guide you through tax season with confidence and prepare your business for success.
Don’t Miss Out on These Tax Deductions and CreditsIf you are looking to score a big return come tax season, there are a few unconventional ways you can utilize to your benefit as a small business owner. Here are some benefits you may qualify for that could give you a tax break:
- Automobile expenses - Claim the business portion of vehicle expenses. Fuel and oil, licensing and registration, insurance for business purposes, maintenance and repairs, interest on borrowed money used to purchase a vehicle, leasing costs, and accidental repairs are all deductibles. Maintain a thorough record of the total kilometers you drive that relates to your business needs, in order to support your claim.
- Insurance - Any regular commercial insurance premiums you are liable for on buildings, machinery, and equipment that you use for your business can be deducted. If you are conducting any business from your home, protect yourself with home-based business insurance.
- Housing Expenses - Home-based business owners can claim deductions on heat, lights, water, maintenance and repairs, cleaning materials, the telephone, and internet connection. However, only a portion of these expenses related to business use can be claimed and they cannot be claimed again elsewhere.
- Mortgage Interest or Property Taxes - If you are running a home-based business and carrying a mortgage, you can claim your mortgage interest if your home is the principal place of business or you use the space solely to earn your business income, meet clients, or customers. Furthermore, property taxes can also be claimed as expenses.
- Hire a Family Member - An employee’s wage is considered a business expense. Provided they have the right skill sets for the job, hiring a family member such as your spouse or child, gives you the opportunity to do some income splitting. Doing so will allow you to drop your net income into a lower tax bracket, resulting in an income tax reduction.