When opening, every business assumes several tax obligations that must be followed to avoid problems with the tax authorities. Therefore, having tax planning for companies is essential and a measure capable of ensuring compliance with the law.
Tax burdens vary and undergo constant updates. To understand each of them, being able to count on an accountant is a must for entrepreneurs and companies that want to ensure growth and sustainability in increasingly competitive markets.
The simple choice of a tax regime, for example, must be done with the help of a professional, as it is possible to save on taxes by doing everything following the law. Even simpler tax regimes like Simples Nacional generate doubts when complying with tax obligations.
Do you want to delve deeper into the subject and better understand how it all works? This article will explain in detail what tax planning is, its advantages, and how to do it. Continue reading on S Lewis CPA LLC for example and offer more of this accounting service!
What Is Tax Planning, And Why Should It Be Used In Companies?
Tax planning chicago for example concerns the management of a company’s tax payments, in addition to studies of ways to legally reduce the tax burdens that affect businesses.
To perform this function, the accountant is a fundamental player in analyzing characteristics and, consequently, guiding decisions that entrepreneurs must make in an organized and strategic way. There are two types of tax planning that you will learn about below.
Operational Tax Planning
Operational planning is developed to comply with current legal standards, including tasks such as correct bookkeeping and payment of taxes on time. It is designed for shorter periods, from 3 to 6 months, and must contain means of articulation to achieve the established objectives. Action plans must be within the stipulated deadline.
The conditions for achieving the objectives must be prescribed; therefore, information such as the methodology that will be used and those responsible for the actions must be included in the planning. These tasks are part of the accounting routine and must be aligned with the accounting team.
Strategic Tax Planning
Operational planning depends on strategic planning, as it outlines an analysis, study, and verification of all forms of taxation in the market. The model aims to think about long-term purposes and benefits. Strategic tax planning is done for long periods of 5 and 10 years. Therefore, it must be constantly reviewed for updates, as it cannot become obsolete and involves considering factors internal and external to the company when preparing it. See everything about tax planning for 2021, for example, and stay updated this year!
Advantages Of Implementing Tax Planning In The Company
Everything works better when it is organized. The financial management of a business largely depends on good tax planning to ensure sustainability and growth. The benefits of implementing tax planning are numerous:
Default reduction: planning prevents debts from being generated with the tax authorities, which leads to defaults for the business, making bills a growing problem;
Analysis and reduction of amounts collected: it is possible to analyze and think about measures to reduce rates, such as reducing the contribution to Work Accident Insurance (SAT) by reducing the Accident Prevention Factor (FAP) or incentive policies for reduction of tax rates;
Plan and replan payments: some actions allow you to postpone the payment of taxes without generating fines. This helps businesses that are low on working capital to gain momentum without compromising tax and fiscal obligations.