Friday, 1 April 2011

Monitoring your tax liability

The best way to stay in control of your tax liabilites is to keep records.

These need not be elaborate or complicated. No need to buy expensive software packages, spreadsheets will do.

Records ought to be maintained on a monthly basis. Fill them in perhaps on a certain day each week, to ensure that transactions are entered whilst still 'fresh' in your mind.

With income, have a sequentual number system for each job/sale/transaction, and it may be good management information to have columns to sub-divide between the different types of services/goods you provide.

With expenses, your tax return categories will suffice at minimum. This would normally be materials, other direct expenses, wages (people directly concerned with providing the services), salaries (adminstrative staff), Premises rent & insurance, Repairs, Travel, Vehicle, Advertising and Adminstrative expenses.

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