SMALL and medium business owners should get more knowledgeable about tax.
Tax compliance is usually a point left unattended because of the many other challenges entrepreneurs face.
Marc Sevitz, co-founder and CFO of the online tax return tool TaxTim, says when people do get around to completing their tax returns they often do it alone, not realising that business tax returns are far more complicated than individual returns. Research done by TaxTim showed 58% of small businesses didn’t get professional help when submitting their annual tax returns.
In fact, only 13% handed the role over to an outsourced professional.
He said SMEs do not have one standard deadline for submission to SARS. They must complete their annual tax returns within 12 months of the end of their financial year, which can be any time from January to December.
Here are five tax tips for SMEs:
- Record every cent
Keeping an accurate and up-to-date record of your business’ income and expenses is important to ensuring a smooth tax return.
- Keep all your slips
Keep all the documents relating to income and expenses, such as invoices and receipts. File them in a logical order.
- Make copies of documents
Keep both a hard copy and electronic version of documents. Scanned copies can be stored online using cloud services.
- Keep all documents for five years
Don’t throw away your documents after filling your tax return! You have to keep all relevant documents for a minimum of five years.
- Use the correct rates for depreciation
If your business owns assets that devalue over time, be sure to use the correct wear and tear rate from SARS’ list of different asset types.
For more information or help on tax return visit www.taxtim.com.