This is something that everybody small business owner can enjoy and should look forward to at the end of the year. As a small business owner, solid bookkeeping is the best way to ensure that you get the most out of your return.
If you’re hiring an outside accountant or a JSC Global Accounting services CFO to do your taxes, providing that accountant with detailed financial records not only makes the job go faster, but keeping track of every bit of money that came through your business during the year can open up opportunities for tax deductions and returns that you may not have considered.
In Nigeria, there are a wide variety of categories that can potentially be claimed as business expenses, including but not limited to:
● Business Insurance Cost
● Meals and entertainment costs
● Business Travel Expenses
● Office Rental
● Salaries & Supplies
● Business Machinery, Vehicles, Equipment and Gadgets.
It can be difficult to remember all of these items offhand, but if you keep detailed books, at the end of the year you have a record of every item that you spent money on, and you can then check that record against the list of deductible business expenses from the FIRS website, and know exactly what amounts you can and can’t claim.
At the beginning of the year, take a look at the list of deductible expenses and determine which categories you’re most likely to spend money in. Consider creating a labelled file folder for each of these expense categories. This way, when you make a purchase, you can immediately file the receipt in the applicable expense category, saving you time when you need to make your expense calculations.
Bookkeeping over the course of a few years also makes it easier for you to estimate how much tax you’ll owe. If your profits and losses remain somewhat stable over a few years, you can get an idea of how much you’ll need to set aside each year for taxes, or how much you should be charging your customers for GST or HST.
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