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Manage Your Financial Operations Better With Our Tax Planning for Business

You must cover a few bases before you begin selling your products and advertising your services if you are starting a new business or have already done so. The tax burden is one factor among several things you need to consider. 

Businesses are significant contributors to building a nation since most of the government’s budgets are primarily supported by taxation. The roads we drive on are one example of the public infrastructure that benefits from this funding, along with other essential services and programs like education, healthcare, and social assistance.

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If you own a business, you can’t put off dealing with your tax obligations forever

The good news is that Pearl Lemon Accountants is here to assist you in understanding your tax obligations so you don’t get caught off guard.

Learn more about our services. Let’s talk.

What is Tax Planning for Business?

Tax planning boils down to looking at a financial plan with an eye to how taxes will affect it. Moreover, it organises one’s financial data to minimise a company’s taxable income and corresponding tax responsibilities.

By analysing the impact of various tax variables on your business over the year, you can develop a tax strategy and take steps to minimise your taxable income. If you want to pay as little in taxes as possible, this can help narrow down the factors you need to consider.

Business Tax Accountancy

Tax accounting, in contrast to financial accounting, is concerned solely with filing tax returns and administering tax payments on behalf of a business. Your business’s size, structure, and VAT registration status will determine the type of tax return you must file.

Your company’s taxable income is calculated through tax accounting, which factors in revenue and the allowable deductions and credits from the government. This means that your actual taxable income may differ from what’s on your income statement. The regulations regarding taxable income are updated annually by the HMRC.

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Get the Latest Business Tax Advice

Consider adopting some of these suggestions into your financial planning if you want to maximise the success of your business and your personal finances.

Register With HMRC

The functions of HMRC, or Her Majesty’s Revenue and Customs Service, include:

  • The collection of taxes.
  • The distribution of child benefits.
  • The enforcement of customs and tax laws.
  • The monitoring of compliance with the payment of the minimum wage by businesses.

As soon as you launch your business, you should notify HMRC of your decision to become self-employed.

When hiring workers, you must sign up for a PAYE scheme and comply with all regulatory requirements, such as Real Time Information reporting.

Use Salary Sacrifice Schemes

With salary sacrifice, businesses can offer their workers more benefits while saving money that can be reinvested in the company or distributed to workers. For salary sacrifice concerns, HMRC offers assistance and guidance.

Avoid Fines By Meeting the Deadlines

To avoid fines, business owners must ensure that their annual accounts, tax returns, and paperwork with Companies House (confirmation statement) are submitted accurately and on time.

Each year by January 31st, sole proprietors and partnerships must file their self-assessment paperwork and pay any taxes they owe. Also, you need to file a tax return if you are a company director or if you have any untaxed income.

Keep in mind that it is the business owner, not the accountant, who is ultimately accountable for the timeliness and correctness of the company’s financial records.

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Review Existing Share Structures

Keep all the proper documentation in order if your organisation issues dividends regularly. You’ll need this documentation in case of an HMRC investigation, which will be crucial when you sell your business in the future. 

It can incur more tax costs, and you’ll possibly receive less money from selling your company’s shares if the necessary paperwork is either inaccurate or lacking.

Face Your Tax Obligations

Tax avoidance schemes are complicated processes that allow corporations and taxpayers to decrease or avoid tax responsibilities. 

While the procedures utilised may be legitimate, such schemes may fall foul of HMRC if their main objective is to dodge taxes.

These schemes are often offered as tax planning, wealth management, or investment opportunities. These schemes should be cautiously approached and can end up costing you more.

Hire a Good Accountant

Get the professional advice of an accountant before making any financial decisions related to your business, as they will be able to provide you with the best advice on how to manage your finances while minimising your tax liability with the tax reliefs available to you.

They can become your most valuable adviser and provide tax-efficient advice and guidance. Whatever business you run, an accountant can offer advisory services on your company’s optimal legal and financial strategies.

Pearl Lemon Accountants can tap into a team of experienced professionals for specialised accounting needs. Our corporate clientele has been with us for many years. Thus, we have earned a reputation as the go-to accounting firm for businesses. We help you build the future of your business. Questions? Get in touch with us today.

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The Corporate Tax Increase in 2023

The upcoming increase in corporation tax is a major factor all businesses must consider in the United Kingdom. On April 1st, 2023, a new tariff will take effect.

Company profits of any scale are subject to the same 19% corporation tax rate as of this year. The record low rate will remain in effect until March 31st, 2023.

Any business with profits over £50,000 will be subject to a higher rate after March 31st. The new corporate tax rate will be 25%, which is remarkably high.

Meanwhile, there will be no increase to the 19% corporation tax rate for businesses with profits under £50,000.

If a company’s profits fall between £50,000 and £250,000, it may qualify for marginal tax relief, lowering the 25% rate to 20%. This may be the case if the company has associate companies or if its accounting period is shorter than 12 months.

Our Tax Planning Services

Pearl Lemon Accountants is home to a team of highly skilled and adaptable accountants. We guarantee the highest standards of quality for the following services.

Corporate Tax Services

Pearl Lemon’s team of tax accountants is available to advise and assist small businesses and corporations with their tax filings and compliance requirements. With the help of reasonably priced tax services, your business can avoid penalties and meet all applicable tax filing deadlines.

HMRC Tax Investigations Advice

You might get anxious after receiving a letter from HMRC announcing their intention to investigate your tax position, especially if you don’t know what this implies or what to do to prepare for an HMRC tax inquiry.

In the event of a tax investigation, it is to your greatest advantage to have an experienced tax professional act as your agent and speak on your behalf. If you need an accountant to do that, Pearl Lemon Accountants is where you’ll find one.

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Payroll Services

All your payroll-related needs, including payroll calculations, payroll tax reports, year-end taxes, and more, will be handled promptly and efficiently by our payroll services. Our outsourced payroll department has worked with businesses of all sizes and types. 

Payroll processing is one of the many services offered by Pearl Lemon Accountants. When someone else takes care of paying your employees in the most effective and legal way possible, you’ll find that you have more time and resources to devote to growing your business.

Personal Tax Services

Decision-makers in business often have complicated commitments between their private and professional life

We’ll work with you and your loved ones to ensure that our tax services help you reach your short- and long-term goals. We have experts in tax advice who can help you plan for the future, safeguard your family’s wealth, and reduce your overall tax responsibilities.

R & D Tax Relief Advice

R&D tax relief is available to businesses investing in innovation and creating cutting-edge solutions to enhance existing products, processes, systems, materials, and services.

Research and development success is not a requirement for enjoying tax discounts. 

The R&D tax credit experts at Pearl Lemon can help you determine if you have a legitimate claim for R&D tax relief and, if so, walk you through the steps of filing that claim to ensure that you don’t make any mistakes that could result in a rejection.

VAT Accounting Services

The value-added tax (VAT) is an integral part of business and can be applied to many products and services. As a VAT-registered company, you are required to collect value-added tax (VAT)  from customers.

Pearl Lemon’s accountants will take the time to verify that your business is paying the amount of VAT to HMRC and ensure that the company follows VAT registration procedures.

Need more accounting services? Take a look at our other offers HERE.

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Get in Touch With Pearl Lemon

If you’re looking for tailored accounting solutions, Pearl Lemon Accountants’ tax team is here to help. We’ll get your tax payments filed on schedule without sacrificing any opportunities for tax reduction.

We provide the best possible tax planning advice for businesses, ensuring peace of mind, tax allowances, and reliefs. 

FAQs

Even small businesses engage in tax planning, a complete financial strategy that examines various aspects of the business’s financial affairs to reduce or eliminate tax liability.

Keeping up with your tax obligations helps keep you out of trouble. You can use strategic tax planning to divert a company’s cash flow to several other savings and investment vehicles. Tax planning is a smart way to keep more of your hard-earned cash. 

If you own a small business, one of the easiest ways to save money on taxes is to hire a member of your own family. For instance, the marginal tax rate on income distributed to your children is reduced; in some cases, it is even eliminated.

Still not convinced? Well, not to brag, but we've been delivering tax and accounting services to our clients with our offices in Asia, Africa, North America, and Europe.

Book a call with us now if you think you could benefit from our services.