Let’s share again something regarding tax today. I do hope the word ‘tax’ is not taking away your appetite for reading this blog. Is it? Even if you hate tax with a passion – and I know some arrogant tax collectors make people do this – just read this brief article. Possibly you might get a thing or two to moderate your hatred. You are an entrepreneur, and I do not think you can escape taxation as long as you operate on this earth. Someone said that tax is a necessary evil. And it is very certain. Quoting Benjamin Franklin, ‘In this world nothing can be said to be certain, except death and taxes’. I think you just need to be informed – and do some tax planning, otherwise your business can suffer excessively. The tax guys could easily take advantage of your ignorance. I guess you don’t want this; do you?
The term tax planning simply refers to legal means by which you can shield your enterprise or yourself from over taxation. Yes – I said legal. It is part of tax avoidance but not tax evasion. Tax evasion is illegal but tax avoidance is not illegal as it uses legal tax planning to minimize and also delay payment of taxes. Regarding delaying tax payment – don’t you agree that cash today is a better choice than cash in two years’ time? I’m not going to bore you with so much explanation of legalities and illegalities of tax here. What I just intend to do here is to highlight a few tax planning issues you can utilize, if you are not yet doing so. Possibly your tax advisers can guide you so that your enterprise might get some value from these.
Many tax planning schemes exist and most of these depend on the nature of tax in consideration and the relevant laws wherever you are. Sometime back in one of my blogs I mentioned the need for an entrepreneur to have some tax knowledge, and I mean it. I know you will tell me you have a tax adviser, or consultant, whatever you want to call him. My rule is this – try and understand the tax laws; and rule number two is – in case of doubt refer to rule number one. Do you want to be so ignorant an entrepreneur who can’t even remember whether all tax returns for your enterprises have been made for a given period? I don’t think so. Now, what are some of the tax planning considerations that might help you minimize and delay paying tax?
Candidly, I think I have given you more than enough clue. Don’t blame anyone! But just a word of wisdom, please get the right advice to be able to fully understand and properly implement any of the above that might be relevant to your enterprise. Do you get me? Don’t come back crying because you simply read this article and moved anyhow.
Good luck with you tax planning endeavors in your enterprise!
The Wise Entrepreneur