For small and medium enterprises, to reach the peak of success and achievement, the owners (entrepreneurs) need to chalk out a plan of action and practice smart ways of paying taxes in order to avoid penalties.
Entrepreneurs should root out negative attitude towards tax remittance and set priorities on tax returns to avoid penalties that can end up leading to the closure of the business. Smart ways of pay tax is a skill that should be learnt. It is the agenda of this article to shed more light on the best ways to save on penalties by paying our taxes.
STRUCTURING A PLAN
There are various ways that entrepreneurs can save and manage the costs of tax penalties. One of the smartest ways of doing this is outsourcing tax matters to a professional tax practitioner. When most SMEs start operating and making profits, they tend to forget to outsource tax matters to somebody who will often deal with financials and tax remittances, and support the company to avoid penalties. Having someone on board who manages tax and finances avoids financial and tax mistakes. However although start-ups can often not afford to outsource financial matters to accountants, they can take advantage of online solutions offered by various financial institutions in South Africa.
Home offices have become a norm for most South African SMEs as long as the owners of the businesses are well-disciplined to separate work and home issues. SMEs that use their homes as business premises benefits from tax deductions such as interest payment on the bond along with other expenses that might have been incurred in having outdoor offices for running the business.
ORGANISING TAX RETURNS
Filing tax returns on time is another way to avoid penalties. SME owners should constantly check all activities and ensure tax is paid regularly and returns are filed on time. Some SME owners may be surprised to discover they owe money to SARS as the tax day deadline draws closer. Should the particular month not have been rosy for the company, making it tight to cover the tax obligations penalties can be avoided. File a tax return or file for an extension by the tax deadline. Filing a tax return is helpful because the penalty for not filing is more