Steps to Prepare Your Online Ecommerce Business for Tax Time

tax time

If you’re in a finance position within the ecommerce business – this is that time of the year when you have to pay your taxes. Small ecommerce store owners are often so busy with the day-to-day duties of running the shop that they de-prioritize keeping their financial statements organized. The more disorganized your information is, the bigger the tax bill will be. Here are some things you can do to not only minimize your tax bill, but also save you some time that you can use to grow your business:

Keep your books up to date:

keep-your-records-up-to-dateHaving clean and accurate records is a critical component of a pain-free tax season. It’s also critical in the event that you get audited.

Remember the important deadlines:

tax time important deadline

Tax deadlines can give nightmares to you, and missing them can result in expensive and unnecessary penalties.

Buy good accounting software: With such a software you can download transactions from your bank or online payment system, and input expenses and revenue. Additionally, it can give you a look at how you are doing financially. And you can keep an eye on the expenses that will give you those tax savings.

Set up accounts to match: If your account name matches the name of the line on the tax form to which it relates, your accountant will know exactly where to put it on the tax form. Easy enough.

Attach copies of receipts to your transactions: You can either take a picture of the receipt, or save an electronic copy to the transaction to which it belongs. This can help you in acknowledging exactly what you bought, and how you can deduct it.

Consider Filing for a Tax Extension: You’ll need to fill out the tax extension form that corresponds with your business type and estimate the amount of taxes you owe for the year. Note that if you don’t make a payment for taxes owed by the regular tax deadline, you could be liable for penalties and interest, even if you’ve filed for an extension.

Author – Pragyan Sharma
Content Writer at Buildabazaar – the place where you can get the best ecommerce solutions available for you.

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