In order for your small business to make a profit, you must take everything you can. You need to make sure you’re taking expenses that are deductible so that you don’t end up giving the government more than what you get.
Take a look at the business write off deductions in this article.
1. Advertising Expenses
Advertising expenses are tax-deductible as long as they are considered necessary and ordinary business expenses. It includes the cost of attending trade shows and promotional events.
If your business is small, you may be able to take advantage of certain tax deductions. One deduction you may be able to claim is for utilities.
This can include costs for things like:
Keep in mind that you can only deduct the portion of your utility bill that is for business use. You will also need to keep documentation of your expenses.
3. Business Write Off: Bad Debts
When it comes to write-offs, bad debts are one of the most common deductions that small businesses can take.
There are a few different ways that you can go about writing off bad debts, but the most common method is to simply treat the debt as a loss on your business taxes.
Business ownership involves any kind of transportation, whether it’s a delivery service or a mobile service, you can deduct the cost of fuel and maintenance. You can also deduct the cost of any vehicles you purchase for your business.
If you use your personal vehicle for business purposes, you can deduct a portion of the cost based on the percentage of time you use it for business.
5. Licenses and Permits
If your business is a licensed one, then the license itself is tax-deductible. The cost of renewing or obtaining a business permit is also a tax deduction.
If your business is required to have any special permits in order to operate, those costs are also tax-deductible.
6. Rental Expenses
One of these deductions is rental expenses. This includes the cost of renting office space, warehouse space, or other necessary equipment. You can also deduct the cost of any repairs or improvements that you make to the space.
Many receipts need to be kept so that if there are problems with the report you can easily find them. Receipt management at Bento will help you to organize a lot of documents you are holding.
They provide a system that can track or find your receipts for specific purchases. You may be charged sales or use tax for them even though you have already paid the taxes at the time of the transactions.
7. Payroll Expenses
One of the most important deductions for any business is payroll expenses. It includes the cost of employee benefits, such as health insurance and retirement plans.
In order to deduct payroll expenses, you must have a detailed record of all payments made to employees.
8. Business Insurance
When it comes to business insurance, there are a few key deductions that small business owners can take advantage of. Business owners can deduct the cost of insurance premiums, as well as any other associated expenses, such as policy fees.
They can also deduct the cost of any necessary repairs or replacements that are a result of damage caused by a covered event.
If you’re a small business owner, you can use every business write off to help reduce your taxable income. These eight deductions are a great place to start. Keep in mind that you’ll need to keep good records and documentation to support your claims.
If this information really helps you, make sure you check out some of our other blogs for other write-offs.