If you are an entrepreneur running a small business, you don’t necessarily have time to be thinking about tax planning year-round.
However, letting details like these slip through the cracks can lead to a massive headache at tax filing time (which is June 15 for self-employed individuals). You may be scrambling to organize receipts and find other deductions a few days before the deadline, causing considerable stress on top of your usual daily challenges.
A common pitfall for self-employed people is not putting away sufficient money throughout the year to cover tax owing. When you’re employed by a business, you typically have an adequate amount of tax deducted from each paycheque, and you may even end up with a tax return. However, as an entrepreneur, it’s up to you to make sure you are putting enough money aside as you earn revenue. You’re probably also charging HST as a business owner, so remember that you have to remit that money as well.
To deal with this particular challenge, you could automatically have a set percentage of your earnings go into a savings account to at least earn some interest towards helping pay down your tax bill.
To find out more about what the tax experts at Eco Tax offer, including payroll services and the preparation of financial statements, call 905-544-4888. The office offers free parking and is located at 2191 King Street East in Hamilton.