10 Tips for Small Businesses Filing Their Taxes

Best Tax Tips for Small Business (1)
April 13, 2024 | | Corporate Tax |

Tips for filing taxes for small businesses

Small business owners should be proud because they have developed their dreams into reality and are working hard toward the growth of themselves and their employees. Starting a startup can be very beneficial for business owners. But there are numerous aspects that might be daunting for themselves.

Filling out their tax is one of those tasks that might be daunting for small business owners. Performing this task is essential within the deadline. Otherwise, taxpayers must face penalties and other punishments. Apart from deadlines, there are aspects that you should learn before filing taxes for your small business.

Learning some basic tax rules and Tax filing advice for startups can help you save money and grow your business faster. The article will provide you with a list of the top 10 Tax filing strategies and suggestions that can help small businesses file their taxes in a more effective manner. 


Best Tax Tips for Small Business (1)

Top 10 tips for filing taxes for small businesses

When running a small business or startup, you should look at several aspects to keep your business running effectively. Filling out small business taxes is one of the most essential components of maintaining healthy financial records. The following is the list of the top 10 Tax filing tips for entrepreneurs of small businesses:

1. Stay organized

Filing tax returns might be daunting for small businesses. When filing the tax return, most companies gather the data over the weekend or evening. In most cases, this data still needs to be completed. Having organized and complete data helps simplify the tax filing process. Below are some tips that can help you to keep your data organized:


  • Keep a separate file for taxes.
  • Ensure expenses and income are categorized in the PC or ledger for easy printing. In addition, you should ensure the data is accurate.
  • Back up digital files
  • Keep records secure
  • Scan paper to include them in digital files
  • Maintain all receipts


When you know where all data is located, you don’t need to waste your valuable time finding old receipts or thinking about whether the payroll files are completed.


2. Know startup expense deduction.

You make a significant investment to start your small business. Most costs associated with starting a new business are capital expenditures, like buying property, tools, software, or other assets needed to start or run a business. 

Remember, these expenditures are not tax-deductible in the year they happen. However, one tax deduction covers particular startup business expenses, which you can only take advantage of the year you file your small company tax return. Therefore, you should understand startup expense deduction rules for filing tax returns.

3. Separate your personal and business expenses.

Suppose the tax authority asks a query about the business tax. In that case, they want to see the itemized records of your taxable income and business expenses.  You should develop your bookkeeping, like bank account records demonstrating all cash inflows, outflows, and any significant expense or buy claimed. 

If you use your personal bank accounts to fund your business, giving proof of your company’s expenses may be messy and time-consuming.  Even if you use your personal bank account to maintain your business drifting, you should still use a separate bank account for personal and business expenses. This move will help you to track your expenses more accurately and ease the process of filing your small business tax return. 

4. Consider working with a professional

It can be complicated for small businesses to notice obscure deductions, keep up with the evolving tax laws and ideal profits. That’s where professional consultants, like Flyingcolour Tax Consultants,  come into play. 

Hiring a financial advisor, business tax expert, or other similar professional might help you discover opportunities you have overlooked. Indeed, a professional consultant costs you some money. But the potential tax relief, stress reduction, and time-saving features of these professionals are really worth it. 

5. Keep a good record of revenue and expense.

Keeping a good record of expenses and revenue on a daily or weekly basis will prevent huge problems at year’s end. There are a few softwares that can help you to streamline how you conduct your business. This softwares can connect to your bank account, payroll statement, and more. This makes tax return filing seamless and keeps you in touch with your business pulse by telling your cash flow and net income or loss. 

6. Deduct charitable contribution

Making charitable investments is an essential method for small businesses to connect with their customers and communities. Remember,  if you donate to a qualified organization, those donations are entirely tax deductible. 

Only cash contributions to a qualified organization are deductible. However, donating appreciable stocks can maximize a charitable contribution to a non-qualified organization. If you contribute stock to an organization, you may only deduct its fair market value when you donate the stock minus its appreciation because you purchased it.

7. Treat taxes for small businesses as a year-round responsibility.

It is essential to consider taxes a year-round responsibility instead of an annual event to obtain the most out of your tax return and reach your financial goal. As CNET mentions, some self-employed workers are already needed to pay estimated quarterly tax payments.  These regular payments can be a good time to reanalyze your strategy and file to ensure you provide the best opportunities for profitable success. 

Best Tax Tips for Small Business (1)

8. Make taxes part of your tax planning 

Small businesses should include taxes in their overall tax planning. Plan your taxes for the entire year. Begin in spring, update records in summer, meet with planners in fall, and have your taxes ready by January.

9. Complete your year-end accounting.

When you complete your year-end accounting, you will better understand your annual expenses and income. This Tax filing advice for startups will help you to minimize your taxable income by claiming tax deductions. You may look at these deductions by noticing your expenses.

10. Set checkpoint meeting

Proactive maintenance of tax throughout the years leads to some surprises at filling times and a better understanding of your key performance indicators. This Tax filing tip for entrepreneurs will break tax prep into little ongoing chunks. In addition, if you structure your checkpoint meeting properly, you will better understand your income statement quickly.


How can Flyingcolour Tax Consultant help you?

Filling tax returns for small businesses and startups might be daunting. Most of these businesses might find it difficult to file their tax return because they lack of necessary skills. Flyingcolour Tax Consultant can help you to file your small business tax return. In addition, our experts can guide you through each step of filing taxes.

To learn more about Filling tax returns for small businesses, book a free consultation with one of the Flyingcolour team advisors, simply call +971 50 5585305 or send WhatsApp messages to +971 4 4542366. you can also drop an email to info (at) flyingcolour (dot) com.

This article was published on 13-04-2024. The information provided in the article is based on the policies and rules applicable at the time of writing it. Talk to one of our consultants for any recent updates or changes.

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