Startup is an adventure, if you are running a startup you have to be very patience because you go through so many ups and downs and it takes a lot of experience to get stable in a business. However, startup is fun as well, except, when it comes to taxation. Especially, to an entrepreneur nothing seems more alarming than an IRS audit letter.
Sometimes, most of the entrepreneurs are not experienced enough about how to deal shrewdly with their taxation. Further, it is most important for a startup to file their tax on time which is difficult to manage as well. It is then suggested them to hire tax advisory services which offers operative assistance to the entrepreneur by providing them business tax preparation services, IRS representation services, and many more other services. These kinds of online tax services for startups are pretty much effective which helps not only in an effective management of their business but also save their time and energies besides getting expert advice. Additionally remaining up to date and e-file is another way to file their tax on time.
Although tax is one of the things that entrepreneurs tend to avoid while running a startup, but it is a fact that business cannot afford to ignore their tax to be part of mainstream market. In fact, the perks of filing taxation is somehow quite attractive for startups that they cannot be ignored by the entrepreneurs. Specifically, filing tax return is the most integral part for faster growth of a startup. This is primarily true for startups that are registered as partnership firms, limited liability partnerships (LLP) or private limited companies. Aside, there are number of other important factors that needs to be considered by startups to get their tax filed;
Offset of losses
As mentioned before, the first period is very critical for a startup, because it’s always a warm-up period. It’s never easy for a startup to start making profit right away. A new business has to encounter losses for initial few years, as it’s a learning and experience gaining period. It is after a few years that an entrepreneur is finally able to observe an uptick in profit section of their balance sheet. However, in this situation it is indeed an exciting news for entrepreneurs that these losses can be offset against profit in the upcoming years. For this purpose, a startup needs to get file their income tax returns with the losses so that they are able to offset them in later stage of their business.
Easy application of loans
Once a startup is registered with the income taxation, it become quite easy for them to apply and get loan. For application of loans, startup is required to file taxation so that they are able to get income tax return which is a prerequisite of loan application. Tax returns are best evidence for a startup’s operations and existence which are required to show while applying for loan. Financial institution like banks always ask for income tax return of the previous years to lend them money.
To Receive Funding
Funding is the most essential way for a startup to raise their capital. For this purpose startups usually approaches venture capitalists, investors and other sources to raise funds. All of these sources then requires the startups to provide them their last years’ tax return t get an idea about the company’s book value and to decide how much funding it can or should be given. This again makes filing income tax returns important for a startup.
So, after getting know the importance of tax filling you might got an idea that this is a crucial step in growth of a business, but it requires much effort and most of the times entrepreneurs are not aware of the procedure. In this wake, we are here to assist you. Our tax services will help you getting tax paid timely. Hiring Startup Business Accounting tax services you will not be just get precious pieces of advice and a thorough assistance for timely tax payment, rather it will also save you time and money that you may spend straying on wrong track.