Reasons Why A Good Bookkeeper Can Help Your Business Save Money on Taxes

When you’re running a business, every penny counts. Lowering your tax bill may be the difference between running a profitable venture and struggling to survive in an already highly competitive environment. While it’s possible to manage accounting records by yourself, hiring a financial professional is critical to the success of your business.

A professional bookkeeper will facilitate the efficient operation of your business and smooth financial management, and can also save you some good money on taxes. Here are three reasons why you can count on your bookkeeper to help put some money back in your pockets.

Professional Records

One of the more valuable services your bookkeeper will provide is accurate year-round bookkeeping, which is absolutely crucial to filing for taxes. A professional bookkeeper will help to identify and track all relevant documentation for financial records like receipts, employment taxes, advertising, expenses, contractors and equipment assets. This will help your business prove that what you report in your filing is accurate. That means you’ll get it right the first time hence no need to worry about fees and penalties.

In addition to managing your books, a highly trained and experienced bookkeeper can help you avoid complicated tax issues by keeping a trained eye on your business transactions. If you find yourself being audited by the IRS, you’ll definitely want to benefit from the backing of a seasoned professional who is ready to support you with well managed professional records.

Accuracy

A professional bookkeeper will also provide the reconciliation of accounts. This means they’ll align specific transactions on your credit card and bank statements with corresponding transactions in your business accounts.

Reconciliations may seem small, but they help to eliminate many errors. What’s more, you cannot make accurate tax filings without accurate records. Your bookkeeper will also uncover any anomalies or errors you may have overlooked or might not have found on your own. In the long run, you’ll be able to make timely tax filings and avoid any other last-minute scenarios that can end up costing more.

A good bookkeeper will also encourage you to separate your business and personal expenses, especially if you’re running a corporation or limited company. Depending on how much information needs to be kept separate, shared accounts can complicate the tax planning process and invite unwanted attention from the IRS.

Handling Deductions

The efficient management of tax deductions is an essential part of the tax filing process. As such, bookkeepers help not only to identify but also to provide documentation support for qualifying tax-deductible business expenses. Only a professional bookkeeper with experience in your industry understands what qualifies to be deducted on your taxable income.

Your bookkeeper will also track your expenses at all times and provide timely solutions to address issues as they happen. That means you’ll have all the information at hand during tax season.

By helping to prepare for tax season, bookkeepers help to save businesses significant amounts of time. Your bookkeeper will ensure you have up to date financial records and that all your payments and receipts are handled on time.

This way, you won’t be updating your financial records at the last minute which guarantees that your business won’t fall behind on filing for taxes. And it goes without saying that filing your taxes late can be a costly affair.

Bottom line

Regardless of whether your business is a new venture or whether you’ve been in operation for a few years, you can’t afford not to have a bookkeeper. General bookkeepers can come in handy but if you want the full benefits of a seasoned expert, find one with a specialty or experience in your business model. This is essential to saving your business cash, eventually putting more profit into your pocket.

A specialized bookkeeper will stay up to date on the most recent developments in the industry. They understand how all the critical factors like staff retention, attendance and usage rates affect your finances throughout the year.

In addition to understanding the details, they can help you leverage your strengths to be more competitive and improve your business’s profits. With a competent bookkeeper on your side, you’ll spend much less time wondering if you’re missing out on something or how you’re going to meet tax deadlines.