Five Important Personal Tax Planning Tips

Share :

Tax planning is an essential part of personal financial management. Individual taxes come in various forms and therefore it is important for every individual to have a clear understanding of the subject so as to improve personal tax planning and management skills. Below are some important guidelines that should assist every individual taxpayer plan for his or her taxes better in the future.

1. Classifications of taxes

Many individuals are not knowledgeable about the different kinds of taxation systems today. There is a difference between Income, Local, State and Federal tax. Real estate tax involves the tax that is attached to real property. Taxes on investments include; dividends, passive stock income, bonds, capital gain and interest. Inheritance and the estate tax is yet another classification of tax that affects individuals. This is the state and federal tax that is charged to the inheritor of the estate. Gifts are also taxed. Entitlement tax includes; Corporate taxation, Social security, Medicare, sales from self-employment and Federal unemployment.

 

2. Seek the services of a tax consultant

Tax planning is a difficult process and many people would not be comfortable in handling it personally. This makes it important to identify a highly qualified tax consultant to handle the job. The tax advisers will prepare your taxes and also make certain decisions that can have an impact on your future. These professionals are knowledgeable of the subject matter and hence are in a position to provide you with taxation related advice. Tax advisers can also represent you during audit procedures that are a nightmare for many people. However, certain factors have to be kept in mind while selecting a tax consultant.

• Availability
• Interpersonal skills
• Proactive
• Well reputed in the industry
• Competent to handle the job
• The rates should be affordable

tax planning

3. Tax preparation is both an art and a science

Mathematics is the science bit that is involved in the tax preparation process. Software programs and calculators are used to come up with these computations.

Tax Planning is also an art in the sense that some interpretations have to be made in relation to the figures stipulated in the financial statements. A proactive taxation consultant should be able to carry out adequate research on any circumstances that are out of the norm and provide you with a definite response.

4. Individual tax returns

As much as it is easier to use the services of a professional tax consultant, there are those who prefer to compute individual tax returns on their own. It is advisable to seek professional help so as to get peace of mind in regards to the tax computations presented.

5. Keep records

Ensure that you maintain proper records of all receipts and purchases that you have made during that particular financial year. Have a file and come up with different categories in relation to the purchases and income that you anticipate to make during the year. This makes it very simple to compute tax returns at the end of the year.

Looking for a licensed Tax Accountant? Contact Total Care Accounting Solutions today!


To find out how we can help you with your Website + Marketing, using our unique location marketing platform called Top4, get in touch today at www.top4marketing.com

Top4 - The All in one platfrorm for your loal marketing needs

Looking to build customer loyalty through social media? Don’t forget to add your business to Top4.global

List your business, create your own digital store to sell goods and services, and share posts on social media. Promote your business on Google instantly! Should you need help with local digital marketing then view our new Google Marketing Platform and services Top4 Marketing

Get Found On Google Promote Your Website, Reach local customers today!

Our Digital Marketing Agency Services Across All Industries Include Search Engine Optimisation (SEO), Google Marketing, Website Design, Corporate Web Development,  and local location-based marketing using our own Google Marketing Platform!

Engage A Social Media Agency For Only 1/3 The Cost Of Employing A Social Media Manager…LET’S TALK!

Comments are closed.

About the author

Michael Doyle

Michael is a digital marketing powerhouse and the brain behind Top4 Marketing and Top4. His know-how and over 23 years of experience make him a go-to resource for anyone looking to crush it in the digital space. To get the inside scoop on the latest and greatest in digital marketing, be sure to read his blog posts and follow him on LinkedIn.

Top4 - Made in Australia with Love
\