If you're a self-employed individual you may assume you can handle your own tax returns, especially if your business is simple and doesn't include much income or many deductions. While it can be tempting to try to handle your own tax returns every year, there are some very good reasons to use the services of a tax consultant. Note a few of the benefits they can offer you here.
1. Overlooked Deductions
Perhaps one of the best reasons to use a tax consultant is that he or she can often find overlooked deductions for you. This can lower your tax bill quickly and easily. These deductions might be for actual expenditures but may also be for other things that are commonly overlooked, such as mileage, use of your personal home, depreciation of your equipment and even your own personal car if you use it for business, and things such as these.
By understanding what deductions apply to your business, you can be more mindful of these throughout the year. In turn, you may change decisions about equipment you purchase and even the type of accounting methods you use, for the most benefit when it comes to your tax bill.
2. You May Want to Change the Legal Structure of Your Business
A tax consultant can assist you to better understand the best legal structure of your business, even when you're self-employed, in order to lower your tax bill and increase your deductions while still protecting yourself personally. You may find that being a sole proprietor allows you to claim certain personal expenses for your business but this also means you're personally liable for legalities related to the business. If you were to be sued, this would affect you personally as you cannot keep the business separate from your own personal income and liability. A tax consultant can help you to determine if this type of risk is worth the benefits you might see financially.
3. Your Time Is Valuable
Consider how much money you make on average per hour, and multiply that by how many hours it takes you to handle your taxes and accounting. That's how much it actually costs you to do your own taxes and accounting. A tax consultant may actually be the more cost-effective choice overall! Not only might it cost less to hire such a professional (like those at Goodall & Co) but consider that you're getting expert advice for the amount you're paying them, versus paying yourself for that same time.