If you’re self employed and in debt then like anyone else it is highly important for you to start looking at ways to reduce that debt and pay back what you owe. The good news is though, that as someone who is self employed, you also have a few advantages over other people struggling with debt and can use a range of techniques that take advantage of your position to get you back in the green. For instance those who are self employed can save a lot of money on their taxes – and by claiming back various expenses it is possible to drastically reduce the amount you owe at the end of the month.
However it is also important here to make sure that you do not try to claim back more than you are entitled to, and that you can back up all of the claims you make. Otherwise you can find yourself getting audited and having to pay back more of that tax at a later date – in other words you can find yourself in more debt instead of being better off.
So how do you decide which taxes you can claim back when you’re self employed? Well one easy method that many people use is to get an accountant to handle this problem for them. An accountant will task themselves with the challenge of collating all of your receipts and financial information, filling out your tax returns, and then just letting you pay the remainder. Because your accountant will help you to claim back as much as you are legally and safely able to, this will mean that you will save a lot of money and in theory you should save more money than they cost you so that they ‘pay for themselves’.
If you decide you want to claim back your taxes on your own however then you need to be careful. Make sure to read online what you are entitled too and what you are not. As a general rule any ‘expenses’ that you pay while working (or that you can realistically claim were for work) will be things you can claim back. That means transport, it means communication and it means rent. However to claim these you also need to make sure you have the receipts to show if you should get inspected. You also need to avoid claiming back for money you used to entertain clients as this is no longer acceptable in many countries and states. Finally, be sure to keep a record of everything you pay for, and of what you claim back, so that you can easily show inspectors where the money was spent.