It is true that due to lack of tax planning, any individual or SMEs make unfeasible situation. Companies, especially SMEs, face this situation often. If the taxpayer wants to reduce his tax burden, he can do so legally or illegally. The legal way is called tax avoidance or legal savings and the illegal way is called tax evasion. Tax planning is a set of legal systems that aim to decrease the payment of Small business taxes. It is to know that the tax payers have right to structure his business in the way that seems best to him. But, it doesn’t mean that they must avoid tax planning.
How to make your money work for you?
It is known that taxes represent an important portion of the companies’ costs, if not the highest. With the globalization of the economy, the correct administration of the tax burden has become a matter of business survival.
Separate income and expenses that are recurring from those that are not. Thus, you can record them in the cash flows of future periods and make payments or receipts forecasts. Monthly expenses such as rent, accounting and Internet, installment payments or annual fees can be recorded as accounts payable in the coming months. Thus, you will have the current consolidated balance of your cash and the future balance provisioned, that is, already considering the bills that you will have to pay.
For this you need to invest
The most important step to manage money like a real professional and in the best possible way is to know how to save your resources so that they retain their purchasing power and work in your favor. There is a myth that investing money is difficult and is restricted to investors with large volumes of capital. This thinking makes people insist on saving money in checking accounts or savings accounts, and their income is less than inflation.
However, starting to invest is easier than it looks. With the internet, it is possible to buy assets with interesting and profitable conditions in the comfort of home. Financial institutions offer options for all budgets and objectives: there are assets for more conservative investors, with little money and for those with a more daring profile and who bear a greater risk.
Do you know the cash flow?
Depending on the type of your business you can control cash flow by day, week, fortnight or month. Do not choose too long a period; otherwise you are more at risk of losing control of your cash flow. Define a way to identify income and expenses. You can differentiate income and expenses by color and / or by a minus sign in front of the amount. The important thing is that it is easy to identify them in the cash flow.