Many self-employed people have recently paid their tax bills for the last tax year, also many limited companies with a March year end have also paid their tax bills.
As we settle back into normal business life it may be a good opportunity to turn your attention to the current business year.
If you operate to 31st March/ 5th April you will have just over a month before the next year end.
This is a key planning time for you and your business. You may feel that the year is going as well as last year or hopefully better than last year.
If so, it is important to get an idea of the position of your business so that we can look into keeping your tax bills manageable.
Broadly speaking, if you were to look at your profit for the year and compare this to last year this would give you an indication of whether you will be likely to pay more or less tax. However for a more detailed look at the position I would suggest asking your accountant. It may be as valuable and surprising how well the year is going.
More importantly, if you are having a good year the burning questions might be “How much tax does that mean I am going to pay?”; closely followed by “If possible, how can I reduce the tax?” As mentioned above, planning now for tax is essential!
A number of simple things to look at with the view to lowering your tax bill tax would be:
Business assets – do any vans need updating? Do we need any new machines, etc?
It is also worth considering whether any repairs/updates to the premises are required.
Computer equipment as well as hardware – look at your business software and consider is there benefit in upgrading or trying some new software.
Looking at training levels – do any staff need training to enhance their skills?
Consider the current levels of staff pay – is it time for a review or does anyone deserve a bonus?
Paying any additional amounts before the end of the year will also help lower your taxable profit.
Spending on any of the above before your end of year is vital to give you the tax relief now. Waiting until your new year would delay the tax relief for another 12 months.
Obviously all these things require you to spend and use business cash flow. However, they will save tax, enhance the business and hopefully improve the business performance for the next year.
If you are interested in a review to see if there is anything that can be done now to minimise your next tax bill give us a call or email Nickie at email@example.com