Mistakes in Singapore tax filing can harm your business branding
The experts advise business owners not to make any mistakes in their Singapore tax filing. However, the fact is they do happen. Singapore tax filing is a sensitive issue, and even genuine errors in it can get you hauled in front of authorities and tarnish your business's brand image, customer relationship, revenue, and growth potential.
The due dates and tasks related to statutory compliance give small business owners sleepless nights. It stresses them no end. It is the reason why many of them enlist reliable providers of taxation services in Singapore. Let us see a few commonly occurring mistakes in Singapore tax filing that you, as a business owner, must avoid.
Not Separating Your Business and Personal Expenses
It is a good practice to separate your personal and business expenses. Because you are required to pay taxes on their revenue received from the sale of services and products. However, you need to deduct profit, business costs, and allowable business expenses from the revenue. This gives you the final figure.
However, sole business owners and self-employed individuals often get personal and business expenses confused. Then, they go and claim personal expenses as deductible business expenses in their tax return. It is a mistake you can avoid by simply keeping detailed records of all your income and expenses.
Reporting Less Income than What it Actually Is
Reporting less income than what it actually is is one of the common mistakes that you, as a small business owner, should avoid at your Singapore tax filing. It happens when you forget to include a few receipts or invoices in your return.
It puts you in a dangerous spot as it smells like you are trying to evade paying your full tax amount. And it is a mistake that you won't find your taxation services Singapore committing. These professionals documents each of your business's financial transaction.
Not Reporting Rental Income
Money earned through rental is also part of your income. Maybe you have rented out one of your office spaces to another small company, the money you earned is taxable, and you should report it in your tax return.
However, many owners fail to do so and commit one of the most common tax filing errors. Here you need to report the total gross rent. And there are certain aspects of rental income like improvement costs or commission paid to an agent that only an experienced taxation services Singapore can take care of in full.
Goods and Services - GST Filing
If your annual revenue has crossed S$1Million during the last 12 months, you need to register your company for GST. Not doing so will be your first mistake in this regard.
Afterward, you will need to charge and collect 7% of GST from your customers and pay it to IRAS. Not doing so as per the schedule will be another mistake you can commit. GST filing is a time-consuming task better left to your taxation services Singapore.
Your taxation services Singapore can assist you in regular bookkeeping and accounting of your books. It is essential for ensuring your business' statutory compliance. Updated and digitized financial data is easy to process to prepare various financial statements and reports. It also brings accuracy to your Singapore tax filing. Do not forget to maintain these records for at least five years as is recommended by ACRA.
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