Have you ever met a lawyer who offered his services to save your taxes? If you are a good businessman than you must have met at least once with such a person and you might think that he will adopt the illegal methods to save your tax. For example, many people file wrong returns and show low profit or income to save their taxes. But you shouldn’t follow these wrong methods.
You should know that there are various methods which can be used to save your taxes legally. There are various overlooked small business tax deductions which if you are aware of can be useful to save a lot of money. Here are the few overlooked deductions for businesses.
Home Office Deduction
Many business owners have a separate room in their house which they use for their business activities when not in the office. For example, if they have a day off but an important client wants to meet on urgent basis then the business owner can meet them in a room of their house. If you as a business owner also using a room for your business purposes you can save your taxes. This just like an expense, just consider you have a room rented from anyone for your office use. You will surely add that rent to your business expense and you know that it is 100% legal. Same is the case with your own house office room. When you have a special room which you don’t use for your private use and it is only for the business use then you can file that in your tax returns and can save a lot of tax.
The costs of starting your business are overlooked by many small business owners. There might be the money you spent for making the feasibility reports, advertisement of your business, amount spend on the training of your employees and many other such things. This overlooked deductions for businesses make many business owners to pay taxes which they can easily and legally save. You can deduct about 5,000 USD as a startup cost for the first year which saves a lot of tax money and you can utilize that money to grow your business.
If your business has some amounts which are receivables but for some reasons you couldn’t get that amount back then these amounts can be considered as deductions for business. Bad debts, advance pays to an employee who quits and such other things can be used to claim the deduction.
These are the few examples of overlooked deduction for business whereas there are many more. You should have complete details about these deductions and only a good lawyer can guide you properly on this matter. So you should consider this legal way of saving taxes so that you can grow your business.
Rashid Nawaz is a professional blogger and a News report. He works for SMH News Agency in Jhang and he is a news reporter on Dunya Urdu as well.