Corporate Tax Planning for Small Businesses

One of the most important things you have to consider when starting a business is your corporate tax planning. In this guide, we hope to clarify a few things so you can get your taxes set up properly and make important savings.

What Does Corporate Tax Planning Involve?

Corporate tax planning involves various areas, including PAYE, National Insurance, VAT, determining the most tax-effective structure for your business, reducing your corporate tax exposure, making the most of tax opportunities and ensuring compliance.

These are all areas you need to consider with your corporate tax planning, which makes it a large and potentially complex area.

Common Tax Mistakes that Businesses Make

There are many mistakes that small businesses make when it comes to sorting out business tax. Here are some of the most common:

  • Waiting too long to get your recordkeeping in order and leaving it to the last minute, which can lead to fines when you don't get everything sorted out in time.
  • Failing to take advantage of the tax opportunities available to you in the form of deductions because you are unaware of them or you have not planned for them properly.
  • Not separating your business finances from your personal, which makes arranging your taxes more complicated.
  • Classifying your employees as contractors either by mistake or on purpose.

5 Simple Tax-Saving Tips

How can you save money on your business taxes? There are many potential ways to do this, and here are five tips that can help.

1. Choose the Right Structure

First of all, you need to decide upon a tax-effective structure, such as a sole trader, limited company or something else. This can make a big difference in how much tax you pay.

2. Take Advantage of Tax-Free Benefits

There are lots of tax-free benefits you may be able to take advantage of, including health checks, mobile phones, car parking and staff parties, so treat your staff and save on taxes.

3. Pay Yourself in a Tax-Efficient Way

Make sure you are paying yourself the right way. For example, if you have a limited company, you could pay yourself via dividends as well as a salary.

4. Be Organised and Claim for Everything

By organising your finances well in advance, you can spend more time getting your taxes in order and you can avoid missing out on expenses that you could claim for.

5. Work with An Accountant

An experienced accountant can help you to potentially save a lot of money on your taxes by ensuring you take advantage of corporate tax opportunities while offering other benefits like helping your company grow.

Get Help from a Professional

Effective corporate tax planning can help you save money as well as reducing your administrative burden. If you would like to speak to someone with extensive experience when it comes to corporate tax planning for small businesses then why not get in touch with a member of our excellent team today.