Article: Getting yourself ready for tax time: become the woman that runs a legitimate business
Getting yourself ready for tax time: become the woman that runs a legitimate business
Tax time can be daunting and for most of my life, it was handled by someone else. When I start to shift my mindset from being a side hustle cash business to a powerhouse lash artist that radiates artistry, I (and you) had to become comfortable with taxes.I am someone who is super passionate about knowing the financial in and outs of my business, even when I wasn’t making a profit.
When it comes to running a legitimate business, doing your taxes is not just a legal obligation, it's also a crucial step in ensuring the financial health of your business. By doing your taxes, you are not only staying compliant with the law, but you are also gaining insight into the financial health of your business. This knowledge can help you make informed decisions about where to invest, how to manage expenses, and how to grow your business. So, don't let the task of doing your taxes intimidate you. Take charge, empower yourself, and show the world that you are someone who runs a legitimate business.
The first thing to do is to choose a tax agent that will handle your business. My accountant handles everything tax, bookkeeping, pay, invoicing related. Your tax agent will be able to help you understand your business structure, if you are set up/registered correctly and what your tax obligations are. Another handy reason to have a tax agent is to find out what is tax deductible for you and what’s not.
How to prepare for tax time:
1. Keep track of your expenses:
Keeping track of your expenses is essential when it comes to preparing for tax time. Whether you're self-employed or running a small business, make sure to keep detailed records of all your expenses throughout the year. This will help you claim deductions and reduce your taxable income, ultimately saving you money.
2. Separate personal and business finances
This is something I did NOT do from the very beginning - it was fine at first as I didn’t really need to track expenses but inevitably as my business grew, I had way more expenses. Opening up a business account helped me keep track of things and avoid confusion at tax time.
3. Plan ahead of time
Planning ahead is crucial when it comes to tax time. Don't wait until the last minute to start organizing your finances and preparing your taxes. Set aside time throughout the year to stay on top of your expenses, track your income, and plan for tax season. Keep all your receipts, have a folder in your emails for all your supply receipts, ask for invoices for your training and upskilling courses. This will help you avoid any last-minute surprises and make tax time a lot less stressful.
Preparing for tax time as someone who runs a legitimate business doesn't have to be daunting. By keeping track of your expenses, separating personal and business finances, getting professional help, and planning ahead, you'll be well on your way to a successful tax season. So, empower yourself by taking control of your finances, and don't let tax time stress you out!