Yes, it's a time of year again! So, are you ready with the calculations? The taxman wants to know about your earnings and the tax you owe him. To define income tax, it can be said that it is the tax charged on the financial income of individuals, corporations and other legal entities. In the financial market, a person can find out various income tax tips and systems. Usually, the tax is classified as progressive or regressive. The tax charged is based on the total income of individual. Â
It is general perception that we all want to pay lesser tax, so it is important that one must manage his or her tax affairs, efficiently. Here are some valuable income tax tips that must be considered before filing for it like: Â
1. Travel Expenses Â
Individual must keep a record of logbook of distance traveled. This will help to accurately determine your travel deduction. As a matter of fact, individual can consider travel expenses like costs to go to seminars, conferences, etc as they are 100% deductible. Apart from this, other deductible travel costs include hotels, airfare, taxi charges, car rentals, parking fess, tolls tax and tips.
2. Medical Expenses Â
Individual can keep records i.e. invoices and statements of medical expenses which are not covered under medical aid. This will help to get a deduction on assessment. Depending on individual's income, medical expenses like health insurance and dental insurance premiums are also listed as deductible. One can pursue non-deductible personal medical expenses into a legitimate business expense.
3. Entertainment Expenses
Apart from travel and medical expenses, individual must be careful regarding entertainment allowances. From March 1, 2002, no deductions can be declared against entertainment allowances for any personal reason. One must make sure that his employer is aware of this and that entertainment allowances are taxed in full. Â
4. Deadlines
Individual must be aware of deadlines as it helps individual in avoiding penalties. Individual must submit the tax returns before the due date given by the IRS. Â
It is a fact, that tax season makes everyone worried. So, it is advised that individual must start early foe preparation. This will ensure that you are availing full advantage of every eligible tax break.
It is general perception that we all want to pay lesser tax, so it is important that one must manage his or her tax affairs, efficiently. Here are some valuable income tax tips that must be considered before filing for it like: Â
1. Travel Expenses Â
Individual must keep a record of logbook of distance traveled. This will help to accurately determine your travel deduction. As a matter of fact, individual can consider travel expenses like costs to go to seminars, conferences, etc as they are 100% deductible. Apart from this, other deductible travel costs include hotels, airfare, taxi charges, car rentals, parking fess, tolls tax and tips.
2. Medical Expenses Â
Individual can keep records i.e. invoices and statements of medical expenses which are not covered under medical aid. This will help to get a deduction on assessment. Depending on individual's income, medical expenses like health insurance and dental insurance premiums are also listed as deductible. One can pursue non-deductible personal medical expenses into a legitimate business expense.
3. Entertainment Expenses
Apart from travel and medical expenses, individual must be careful regarding entertainment allowances. From March 1, 2002, no deductions can be declared against entertainment allowances for any personal reason. One must make sure that his employer is aware of this and that entertainment allowances are taxed in full. Â
4. Deadlines
Individual must be aware of deadlines as it helps individual in avoiding penalties. Individual must submit the tax returns before the due date given by the IRS. Â
It is a fact, that tax season makes everyone worried. So, it is advised that individual must start early foe preparation. This will ensure that you are availing full advantage of every eligible tax break.