Considering Your Financial Future...
- 26 February 2019
We are already half way through the first quarter of 2019, and if you have not already, now is a great time to consider exploring planning oppurtunities for either your business or personal tax affairs. Assessing the shape of your business before year end can offer various benefits and improved financial outcomes year end. Strategic planning of key financial situations ensures there are no surprises come end of year.
What do we mean by planning?
Essentially it is the process of proactively analysing the financial situation of the current year and developing the strategies ensure you are maximising the claims your business is entitled to.
It is recommended that this review activity is completed either in the middle or towards the end of the financial year, this allows you enough time to develop and implement new strategies. For example, an estimated tax obligation based on the current and projected business performance can then be forecasted and aligned with stakeholders. Knowing your future obligations is critical to managing cash flow planning for the year ahead.
It is important to note that this process is not limited to only complex structures and/or larger corporations. Taxpayers contemplating even the most ordinary transactions should thoroughly consider tax review and the consequences to ensure that they do not suffer adverse tax outcomes, below are a few key reasons as to why you should consider and implement planning tax activity for your business.
Utilise New Concessions
Every year the Government makes changes to the legislation therefore the process of tax planning ensures to take advantage of any new/existing tax law changes and helps to manage any potential negative impact of the new legislation.
See The Bigger Picture
Discussing different options not only reviews the strategies to maximise the claims you are entitled to, it also provides great insights into business allowing the owners to see a bigger picture for the years ahead.
This is a great opportunity to analyse your business structure and whether it needs to be changed; review and enhance the operations and processes in place, explore potential profit areas; and find new investment options and decide on its structure.
Modelling your cash flow, financial performance and taxation in advance is a great opportunity to look at the options open to your business and optimise strategies across all areas all whilst the data is being carefully analysed.
Peace of mind
Eliminate unnecessary stress and uncertainty by knowing what your business’s cash position, profit position, and tax liability will be in the short to medium term. This exercise gives your business the ability to make decisions based off accurate forecasts.
Planning and considering different options for your cash flow, financial performance and taxation remains one of the most critical financial functions of any successful business.
Author: Yulia Pyatrauskayte