5 Tax Saving Tips For Business Owners And Start-Ups
Businesses in Dubai have become more stringent due to mandatory requirements and tax law compilations. And hence, Tax Consultant Services are shown a great deal of importance to. However, if you’d like to get started on your own, here’s a guide to make you a pro at Taxes!
5 Tax Saving Tips For Business Owners And Start-Ups You Must Know Of!
1. Hire The Right Agency
Not to put a feather on our own hat, but consultancy agencies have years of combined experience and are always invested in knowing the newest ways in handling your accounts and are ideal if you’re looking for solutions to save up on taxes, especially if you are a small business owner. When making a decision on what Accounting Firm in Dubai to hire, be sure that they are willing to work with you on a long term basis and their methods are advanced and highly transparent to you, the client.
2. Keep Adequate Records
Keeping thorough and accurate records throughout the year will ensure that your tax return is correct. With unclear missed out returns, you could risk your business towards receiving a tax audit. For all our clients, we like to maintain and save their tax records on Cloud so as to assure no misplacement of the same. Another way to keep your tax records in check is to ensure that you collect and keep all your receipts in one place. No record is too small– if you use your vehicle to commute to your workplace, make sure to track the mileage and keep a record of it, which can further help in tax deductions. The same can be done for your employees that use the company’s funds to commute to their workplace.
3. Don’t Overlook Carryovers
Certain deductions have limits that can prevent you from using them fully in the current year but also permit a carryover to future years that are a way to reduce taxable income. Make sure to keep track of carryovers so that you don’t miss out on the opportunity to use them in the future.
Some examples may include:
- Charitable Contribution Deductions
- Capital Losses
- Home Office Deductions
- General Business Credit
4. Change The Structure Of Your Business
As a small business owner in UAE, you don’t have the advantage of an employer paying a portion of your taxes and hence it may be time to pick a new structure. Many small businesses choose to do business as an LLC (Limited Liability Company) because they are considered as a pass through entity that offers great flexibility on tax returns. Under LLC, you may still have to pay medical taxes, but you can eliminate half of this responsibility. This may be a wise switch for small businesses.
5. Avoid Penalties From Late Payments
This is as simple as it sounds, but a lot of small and large businesses miss out on the tax return period and end up paying more than they should in the form of a penalty.
Auditing Firms in Abu Dhabi, just like ours can work towards keeping your records on track and help you avoid late payments.
Getting your documentation together and ready earlier on in the year can help you prepare in advance so that you don’t miss out on the necessary paperwork and payments during UAE’s tax season.
If taxes are still a thing that worries you and takes up too much of your precious time, get in touch with us to outsource us as your Tax Consultants.