How Tax Planning Let’s You Save Money

Posted on May 20, 2013 | 0 comments

There is a thing called tax planning and if you haven’t been into this activity, then you might not know it but you could be spending too much on tax. Creating a tax plan lets you know where your tax position is by the end of the year which helps you prepare and improvise ways on how you can lower such position. You might be thinking that it might be illegal but no, it is legally allowed because you are trying to anticipate your tax and you are trying to make ways to lower it before it is actually due.
Proper planning will definitely help save you money on tax. Don’t know how to do so? Below is a discussion of how you can go about tax planning.

Paying early
When you have expenses that are due for payment on July, there’s no reason why you can’t pay it now. There’s actually a good thing if you do so because you will be entitled to a tax deduction for this financial year.

Checking depreciation schedule
Always make time to check your depreciation schedule at least once a year. It would be worth it to buy new ones while the old ones are still working but is close to being obsolete than to try to get ones when the current ones have broken down to unrepairable state. Then you wouldn’t have enough time to allot money for such investment, letting you go into risky decision making.

Additional superannuation contributions
If you think your business could handle it, ponder on providing additional contributions to super.

Review and analyse bad debts
Look into your trade debtors and write-off old debts that are no longer recoverable.

Implement changes
Before the new financial year, make sure that you will change and implement these changes.

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