Owning your own business is something many people aspire to do. It provides freedom, more money, and more control over your day-to-day life. Becoming a business owner is easier than you think, too.
But, once you’re a business owner, there is a lot you have to consider. If you’re confused about different types of taxes, don’t feel bad. You can always pay an accountant to help you sort things out, but knowing the basics can help you stay on top of your business’ finances.
Read on to learn about the different small business taxes to pay.
Products and Services Sales Tax
The product and services sales tax is a tax that businesses must collect from their customers and remit to the state. The tax is generally imposed on the sale of goods and services but can also be from the lease or rental of goods and services.
Business Income Tax
The business income tax is a tax on the business’s net income. The tax is imposed on the business’s profits and is generally lower than the individual income tax.
The payroll tax is a tax on the wages paid by the business. The tax is generally imposed on the business’s gross payroll but can also be imposed on the business’s net payroll.
Business Property Tax
The property tax is a tax on the value of the business’s property. The tax is imposed on the business’s real and personal property and is generally based on the value of the property.
Self-employment tax is a tax on the self-employed business owner’s income. It’s calculated based on the business’s revenue minus its expenses.
Dividend taxes are imposed on the dividends that a company pays to its shareholders. The shareholders are then responsible for paying taxes on the dividends they receive. The tax rate on dividends is typically lower than the tax rate on other types of income, such as interest and capital gains.
Capital Gains Taxes
The capital gains tax is levied on the sale of assets, such as property or stocks, that have appreciated in value. The capital gains tax rate is typically lower than the rate for income taxes, so it may be advantageous for businesses to invest in assets expected to appreciate in value.
If you need more info on tax planning strategies, paying taxes, and filing taxes, then you should get more information at Wealthability. Dealing with taxes can be stressful if you are unfamiliar, so you must be aware of the basics and ensure that you don’t miss paying any of them.
File and Pay the Different Types of Taxes Required for Your Business
After several months of planning for your business, making it happen is only the beginning. This is because there are other things you will have to regularly pay attention to, and these are the taxes. Surely, you don’t want to encounter issues with the IRS.
The different taxes businesses pay can be complex and confusing. However, knowing the different types of taxes and how they work can save your business a lot of money. Contact a tax professional to ensure you are paying your business’s correct taxes.
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