How to Prepare your Business for Tax Season

With tax season bearing down on us once again, it can be one of the most stressful periods of the year. This is especially true if you are running your own business. There are many things you can do in order to help relieve this stress. They range from very basic steps to calculating more complex deductions. No matter your situation, there is almost always something you can do to help ease the burden.

Here we have compiled a few of the most important guidelines you need to follow when it comes to preparing your own business for tax season.

Be as Organized as Possible

This may seem like the most basic of steps, and it should be. However, for so many people, this is often the most difficult. There is often a misconception that business leaders and entrepreneurs are highly organized. Quite frequently, the opposite can be true. Entrepreneurs are often self-starters with an abundance of ideas but in many cases, their minds are running wild with new concepts. This means they can in fact be highly disorganized.

Needless to say, you need to effectively combat this issue. Ensure that you keep every invoice, receipt and otherwise useless piece of record you can find throughout the year. The things which you may not think are important can all add up to a much smaller headache for your accountant and even a substantially bigger rebate on your tax return at the years end.

Know Your Deductibles

Another key area where people lose out on potential returns is simply by overlooking things which they feel may not be necessary. Include everything. The tax code is highly complex and you just never know what may increase your end of year tax return. Anything from business trip expenses to converting your spare bedroom into a home office can save you big bucks on your annual filing.

Hire a Professional

In the long run, this could turn out to be the most profitable piece of advice. There is another common misconception that hiring a tax accountant has to be a high cost expense reserved for the benefit of a few. This, again is simply not correct.

In today’s hyper-competitive job market, there is an abundance of highly talented accountants literally at your fingertips. Besides the fact that larger companies such as H&R Block offer some fantastic assistance and great pricing on corporate and individual returns, you also have handy and convenient online services such as Turbo Tax. All of this is not to discount using the local friend of a friend who happens to be highly proficient at filing. These are all valid options and very much available.

Conclusion

We can see, there are a number of affordable and convenient options available to us for filing both individual and business returns. In this field, it literally pays to be organized, thorough and even spend a little money to ensure you are doing everything by the book.

Knowing When It’s Time to Change Your Business Direction

Regardless of how long we have spent in business or how much success we have had. There always comes a time and a place for change. This change could be focused on the natural evolution and life-cycle of one part of the business or a wholesale change in direction.

Whichever type of change you wish to instigate, it will never be easy. Naturally, you will battle against some external resistance. This could come from employees, or even the market itself. The toughest battle you will face however, is with yourself. This is why you must be strong and know when the time is right. Here are a few indictors which may push you in the right direction.

 

Loss of Passion

This may be the number one, red hot indictor that a change is required. The daily drive and determination has turned from an insatiable hunger for success to a laborious drag to raise yourself for the morning commute.

Of course, in this case, time is necessary. We all have temporary blips. If though, you find yourself at the levels of a certain McAfee founder, it may be time for a re-assessment of your business direction and goals.

Do not think that your loss of passion goes unnoticed to the company’s bottom line. This is certainly not the case. The entire organizational culture inevitably suffers in a top-down fashion. Therefore, a change of direction can only be beneficial to all.

Changing Market

This is more reflective of what should be the natural evolution of a company or product. You simply have to move with the times. It pays to be proactive, even if some of your proactive moves end in failure or largescale rejection.

There are examples on both sides of the spectrum of when companies realized and initiated positive product evolution, such cases as Apple and Dre Beats, to name but a few. Sadly, there have also been many who have missed the proverbial boat. Nokia is one which springs to mind.

Of course there is a chance that your move has been ill-conceived, such as the infamous USFL challenger to the NFL. However, the effort alone is worthy of some note.

Financial Difficulty

Of course, there are a variety of reasons why you may be in financial strife. There is no doubting however that this is one of the tell-tale signs that something you are doing just isn’t working. This is not to be confused with short-term cash flow or management issues, something which almost all businesses have experienced.

Generally, your gut-instinct is correct. Deep down, if you feel that something is going astray and in need of a change, it is often well past the due time and you should get to work on a new direction quickly.