Like any female entrepreneur who uses some form of entrepreneurship through commerce, she must know what to do by the end of the year. You will learn how not to pay high income tax in this article.
When applying for a tax expense, the self-employed person can decide whether to apply an actual or fixed expense. The easiest way is fixed expenses. These are the basic questions and answers you answered Consultare accounting firm Digital
What is the method of recording income and expenses from trade?
A self-employed person can record their income and expenses, which you will apply on their 2021 tax return in three ways. These are tax records, simple accounting, or double entry bookkeeping. A self-employed person can choose any of these options without restrictions. As a trade as such is not a legal entity, it is not obligated to maintain double bookkeeping as for example pri sro
When do I tax business income for 2021?
The freelancer must file a 2021 tax return by 31.3.2022 or, if a deferment is requested, by 30.6.2022. The moment the income from the trade goes to the tax return determines how income and expenses are recorded. When you keep simple tax and accounting records, business income is taxed in the year it was paid to you. This is different in the case of double bookkeeping. Here revenue is taxed, that is, the moment of taxation is the issuance of an invoice or block, regardless of when the revenue (revenue) is paid.
Tax records or simple accounting?
Entrepreneurs choose these two methods of recording income and expenses from trade most often, because they only tax the income that has already been paid to them. The advantage between keeping tax records and simple accounting is that it is sufficient for tax records to have an overview of income and expenses in a timely manner. The form of tax records is not provided for by law, so it is possible to create a simple tabular record in a textbook. In the case of tax records, it is also necessary to keep records of fixed assets, and if the self-employed person is a VAT payer, it is also necessary to keep records of VAT. There are no other obligations in the tax records. However, with simple accounting, you must already comply with the accounting law and keep the accounting in a cash journal, and after the end of the year, in addition to the tax return, prepare and submit the financial statements.
How do I apply expenses to base reduction for 2021?
When applying for a tax expense, the self-employed person can decide whether to apply an actual or fixed expense. The easiest way is fixed expenses. Flat rate expenses can be claimed in the amount of 60% of the income from the trade, but up to a maximum of 20.000.00 per annum. In addition to fixed expenses, the independent business owner will reduce the tax base by way of paid health and social insurance. For actual expenses, you must already keep records of them and substantiate them with real accounting documents (invoices, blocks, contracts). Payment of actual expenses must be evidenced by cash receipts or bank statements.
What can I do to avoid paying the high tax for 2021?
When recording expenses in the form of simple tax or accounting records, it should be borne in mind that if I want to reduce income tax for 2021, I must pay all expenses by the end of 2021. You should definitely be careful to pay the health and social insurance contributions for the year in full by 31.12.2021. Pay all the bills you’ve received by the end of the year, or else you’ll have to claim next year’s expenses. Think about what expenses you can still claim, for example, if you don’t have a car for deals and you’ve compiled travel orders, make sure you pay those reimbursements by the end of the year. You will pay tax on the cars you use for business by 31.1.222.
Do I have to pay all costs by the end of the year if I keep double-entry books?
If a self-employed person maintains double-entry bookkeeping, they will not have to pay all costs by the end of the year to claim them as tax expenses for 2021. The exceptions are costs whose tax deduction is associated with reimbursement. These costs include accounting, taxes, economic consulting, legal services, brokerage commissions, marketing studies and rents. You must pay these costs by the end of the year so that they are in your tax expenses.
Don’t forget your other income, too!
When compiling daYou can also tax income from 2021 as a self-employed person, but also on other income from 2021. You can also paperwork, etc. You tax all of this income in one type of income tax return B.
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