As the old saying goes, there are only two certainties in life: death and paying taxes. This really does ring true, especially when you are a small business owner. Tax is a percentage that is deducted from your total earnings by your country’s government. This money is then used to keep the country running – it is generally contributed to healthcare systems, legal systems, educational systems, and other systems such as transport and infrastructure. At the end of each year, you will have to file a tax return, which details your earnings and shows how much tax you should be paying. However, before filing your business’ tax return, you should familiarise yourself with the concept of tax deductions.
What Is a Tax Deduction?
Tax deductions are also commonly referred to as “expenses.” If something is a tax deduction or is “tax deductible”, it can be used as a tool to reduce your taxable income. They are generally things that you have only had to purchase in order to be able to run your company and that are only used for professional purposes.
What Are Some of the Most Common Tax Deductions?
Tax deductions will vary depending on what your business specialises in. But the infographic from TripLog below should help to familiarise you with some of the most common tax deductions for small business!
Infographic Design By TripLog