Income Tax-Saving Tips for Small Businesses

Here are a few tax-saving tips to help you with just that

 1. Maintain proper records

First and foremost, make sure you have recorded all the expenses incurred by the company, right from all the trivial expenses to the major ones. If there are any transactions missing from your records, then your company would end up paying more in the form of taxes.

2. Avoid cash payments

Cash payments are more difficult to keep track of than online payments or payments made with cheque and DD. Furthermore, if your cash payments exceed ₹20,000 in a single day, tax deductions on that amount are prohibited under the law. Hence it’s better to avoid cash payments as much as you can.

3. Check if any investments can be deducted

The tax department provides a 20% tax deduction for depreciation of new machinery within one year of its purchase. When filing your returns, check whether any business purchases that you made can be eligible for this and list them accordingly.

4. File your returns before time

If you do not file your return before the due date, then you’ll have to incur extra penalty charges unnecessarily. So make sure you’re punctual with filing your taxes.

5. Seek professional help

If you aren’t very confident about the whole tax-filing procedure, then you should get a professional onboard to take care of it. Hiring a professional will also ensure that you take advantage of all the available income tax deductions for business under the provision of law.

To summarize, you can save up a substantial amount of money from your taxes if you plan your finances better.

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