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How Can I Get on Top of My Taxes?

#timelytaxes Aug 09, 2024

Introduction:

Hey there, business owners! Feeling the weight of tax obligations constantly piling up? You’re not alone. As a tax agent and money coach, I understand your frustration and stress. Let’s transform those overwhelming feelings into manageable, proactive steps to stay on top of your taxes.

Understanding the Challenge:

Taxes can feel like an endless barrage, hitting you from all angles – personal, business, GST, staff taxes, employee superannuation and more. The financial strain is real, taking up anywhere from 15-35% of your income. But don’t let it get you down. Instead, let’s focus on strategies to alleviate this burden.

Mindset and Planning:

Shifting your mindset is the first step to effective tax management. Consider these actions:

  • Tax is a part of doing business: lots of people hate paying taxes, so it's time to swap that thinking.  Instead of thinking that tax is a penalty for making money in your business, think about taxes as being an ordinary part of running your business - like paying the electricity or your xero subscription.
  • Positive Action: Imagine the peace of mind you'll feel knowing you've set aside money specifically for taxes. By allocating a percentage of your income regularly to a specific tax bank account, you'll always be ready when the tax man comes knocking.  Work with us or your accountant to work out the right percentage to put aside.
  • Empower Yourself: Educating yourself on the ins and outs of tax payments that affect your business can significantly reduce anxiety. When you understand the process and you are ready to pay, it is less fear based and more empowering to pay taxes, and you feel more in control and organised. 

Practical Tips:

If simply setting aside money isn't working, here are some practical strategies:

  • Direct Payments: Picture the relief of paying 20% of your income to the ATO directly. Whenever you lodge a BAS form, you know that a partial payment towards this tax has already been paid, so you can breathe easier and not have to find the whole amount that's due.  Make this a consistent habit, whether you earn $100 or $10,000, and feel the stress lift as you manage your obligations proactively.
  • Regular Monitoring: Keeping track of your payments and deadlines can be empowering.   Find out what taxes are applicable for your business, and ask what the due dates are, so that you can add them to your calendar and your cashflow forecast.  When taxes aren't a surprise, it's easier to handle.

Conclusion:

Taking control of your taxes doesn’t have to drain your energy or harm your business. With the right mindset, careful planning, and strategic actions, you can manage your tax obligations effectively and feel confident about your financial health. Need personalised advice or assistance? Reach out to us at Northwest Accountancy. We’re here to help you navigate tax complexities and keep your business thriving.

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