Business Tax Planning and Itís Importance

Posted by lvglawfirm on December 20th, 2019

“Business tax planning” is quite a commonly used term but not everyone understand it completely. Below we will explain business tax planning thoroughly to help you understand its need in your business.

Tax Planning

To put it simply, the activities or steps are taken to minimise your taxes to keep your business in-budget and functional is tax planning. You can have several benefits of strategic tax planning with the help of expert tax planners from law firm Bethesda

Importance of Business Tax Planning

Businesses often employ tax planning strategies to achieve their business and financial goals. Both small and large businesses have several tax planning benefits. A business employing tax planning strategies get help in:

  • Lowering the taxable income amount

  • Decreasing the tax rate 

  • More control of tax-paying time

  • Reaching the maximum limit of tax credits/tax relief available

New laws constantly keep changing the tax benefits and features, which makes it important to keep yourself updated all the time. Businesses also employ a number of different tax planning strategies that can benefit them and save them some tax.

Capital Gains Tax 

If you are planning for CGT or capital gain tax, you have to think about a number of things like what is the product sold and who is the buyer. Tax planners can do all the maths for you and tell you the exact items that can be exempted and also things that need to be included. 

Corporate Tax 

Profitable companies often pay hefty amounts in the name of corporate tax. However, if business owners can employ corporate tax planning, they can save more profit and derive more value from the business, independent of what size of the business. 

Corporate tax planning strategies include: 

  • Deferring income or profits

  • Capital allowances

  • Bringing forward costs

International Tax 

Large business owners often do business internationally and start living outside the nation. Now, if you often come to the States for work but again go back and it’s always come and go for you then you can save money on your business with international tax. Expert tax planners from law firm Maryland devise strategies for both national and international taxes and save a huge amount of business profits

International tax planning strategies consist of: 

  • Using tax deferral opportunities

  • Timing of tax bills

  • Avoiding double taxation

  • Foreign tax credits

Dividend/year-end Tax Planning

If you are looking to get a significant amount of profit from your business this year then you should map out a high dividend. Expert tax planners from law firm Maryland can devise a good strategy for your business so that you can pay yourself and your employees in the most tax-efficient way. 

Inheritance Tax

The IHT or inheritance tax sometimes reduce the estate amount that will be passed to your loved ones after you. Tax planners extract and work on several IHT opportunities that can help your family get more than what they get by simply paying IHT. These opportunities include:

  • Gifting property

  • Downsizing

  • Insurance and remortgaging options

  • Available strategies can also be used in pension funds. 

Tax Planning for Individuals

While many businesses operate on overall business tax planning, private individuals are also involved in the strategy. Careful tax planning from expert tax planners from law firm Bethesda can help individuals retain their property to a wide extent. Strategies used for individuals include: 

  • Income tax

  • Gifting children

  • Gifting family members

  • Property

  • Pensions

Tax Planning from Experts

For those who are seeking to minimize their taxes and protect their wealth, you have several investment options to successfully do so. Hire expert tax planners to give your business the financial aid it needs.

 

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