Payroll tax software: Tax tips for small businesses
The success of a business is generally defined by the size of its profit margin. Companies that have large amounts of money left over after all expenses have been taken into account are considered to be more successful that those that only make a small final profit.
Boost your company’s earnings without increasing your revenue by paying by finding legal ways of paying as little tax as possible. Of course, all business owners are legally obliged to pay the correct amount of tax to avoid prosecution. There are, however, legal ways in which to avoid paying unnecessarily tax.
Payroll tax software is a useful tool that, if used correctly, can help you to save money. Read the following tips for some suggestions on how to legally avoid paying the government more tax than is due.
Best tax tips to help your business to save money
- Use payroll tax software to pay your employees. Using payroll tax software will not only help you to pay your employees accurately, it can also assist you to make the correct deductions from their salaries before they receive them. The reason these deductions are held back is because the government does not require that your employees pay tax on these payments. Deductions such as medical aid and pension contributions do not get taxed if they are deducted before a salary is received.In some instances, a company will make a contribution towards an employee’s medical aid or pension. This contribution is also tax deductible. Payroll tax software provides a convenient way to keep track of contributions that you make on behalf of your employees, and to avoid paying tax on these deductions.
- Consult a tax specialist. Businesses are allowed to deduct tax from a variety of different expenses. Some of them are fairly obvious and have become standard entries on a tax return form, but there are many that a small business owner may not be aware of. A tax specialist is well-versed in many different ways of legally avoiding unnecessary tax payments. In addition to identifying the areas in which you can avoid paying tax, a specialist can also make sure that you are not accidentally making any illegal deductions.
- Consolidate your finances. Keep all of your finances consolidated by using one brand of accounting software. Companies like QuickBooks offer comprehensive business financial software packages that include accounting programs, as well as payroll tax software. Not only will this make it much easier for you to see an overview of your profit margin, it also makes a good impression if you are ever audited. If your finances are neat and orderly, an auditor is less likely to look for errors.
Beat the taxman with payroll tax software
Many small business owners find the process of paying taxes a chore that never seems to end, but with the correct small business software it needn’t be. Contact QuickBooks now to choose from our wide selection of accounting software.