Whether you are a new business or a small business owner who is too busy to be clued up on what tax benefits you are actually entitled to. You are most definitely not alone and I believe that there is a space where you can find easy-to-understand, up to day and relevant information on what your business is entitled to, especially in this economy where things are forever changing, but also finding a source that is both reliable and fact ridden is key. There are so many tax deductions that are consistent across many countries, including the UK and Singapore so we are going to give a more broad term to encourage you to research the specific terms and conditions of your business, as they are always subject to change depending on which region and business type you are in.
What Does Tax Deductible Mean?
When you are trying to figure out which of your business expenses are tax deductible, you first need to understand what exactly that means. Essentially, tax-deductible expenses are outgoings that you can legally deduct from your taxable income. This reduces your gross profit and, of course, the amount of tax you pay that year. Many reasons and situations give some businesses the right to pay or not pay certain taxes that others would have to, including executive income insurance, which protects people who have been told they cannot work due to sickness. This is classified as a business expense; therefore, both individuals and the company are greatly relieved from tax.
This is just a small example of the tax-deductible expenses that you might be able to claim. It’s important to note that once the tax year has ended, you are no longer able to claim deductibles, so it’s key to know this information, gather the evidence and submit it close to the end of the tax year so your payment is calculated correctly.
Here are some common core deductible expenses that your business could be entitled to this tax year. If you require further information or details, be sure to contact us, and we can help further.
Core Deductible Expenses
Salaries and Wages
You will be surprised to learn that your business could save some on tax expenses if you simply looked at your main outgoings, such as wages and salaries. This could include basic pay, bonuses, commissions and allowances. While this is dependent on the business type and sufficient evidence, there could be some real alleviations that could help you increase your profits while also helping you remain confident in paying your staff’s wages.
Ensure accurate and sufficient evidence of record keeping whether it’s with us at WLP or in-house. This includes sickness, statutory, paternity or even overtime.
Rent and Utilities
Being a business with an office or a service with a shop at hand, you can get some tax deductions due to your outgoings towards your rent and utilities. Especially in today’s real estate crisis and with rent prices skyrocketing, it’s hard for businesses, especially those that are smaller. Be sure to differentiate the business from the person; this might be easy because of addresses and renting from a commercial company.
Travel Expenses
Some people have to travel for their jobs, whether they are up for hire or work with a company, therefore, they are being paid back for the expenses and double taxed, which isn’t fair. It’s the same for those that use gasoline and so forth. From both sides, including the business and the individual, there are clear tax deductibles to avoid double taxation. So ensuring that all evidence is gathered throughout the year, whether it’s receipts, emails between your business or whatever else is needed, you can submit it monthly to your accountant and it will be deducted at the end of the tax year.
Insurance Premiums
While there is a huge list of potential insurance policies your business might appeal to and take out, you can rest assured that any of them, like those mentioned, executive income insurance, property insurance or business liability insurance from Executive Life, will all come with tax efficiency and deductibles. This is a great bonus, as not only do you save on tax but you are also protected against any harmful incidents, both for businesses and employees.
Final Thoughts
When it comes to finding out which business expenses come with tax deductions, you can find that most things are not only music to your ears but prompt you to all important documentation to pass on to your accountants or to send forth yourself
