Having a tax advisor in your financial team sets your business up for success from day one, as they help the team deal with tax remittals and other issues regarding the company’s financial management.
Tax implications can be a complicated component to handle in business. With most tax requirements in fine print and difficult to interpret for most industries, a tax advisor comes in handy to bridge the gap, help businesses comply, and avoid running into legal issues.
This article analyzes the following roles specific to a tax advisor in your business financial team:
- Advising the finance team on tax obligations
- Management of tax records
- Representing the finance team at audits
Advising The Financial Team On Tax Obligations
Every transaction or decision in business comes with a consequent demand in taxes. A tax advisor should have a deep knowledge of these taxes and advise the team on the importance of meeting the needs of any financial decision.
The tax implications begin at the very start of your business, and as such, it’s essential to enroll the services of a tax advisor early on to help interpret the following tax issues:
Tax Obligations
For your business to succeed, you must comply with all the state and industry tax laws. Considering that you may not be aware of all your tax obligations or the rules associated with tax payments, you can employ the services of a tax advisor to interpret these taxes and laws for you.
A tax advisor throughout your investment journey helps you make sound business decisions based on tax advisory. You will be able to remit your taxes on time and avoid incurring losses due to non-payment of taxes.
A tax consultant can advise you on what taxes to hand to your customers in a sales business. You can consult a tax advisor when pricing new products or services in your business to help determine the consumer obligations of those of your business as a supplier. A tax consultant will ensure you don’t get overtaxed for your products or services.
Your tax consultant can also advise on tax credits to take advantage of in particular business moves. They can also guide you on acquiring a tax-exempt status based on the structure of your business.
Business Liabilities
Certain business moves could expose you to unforeseen tax liabilities. A tax advisor analyzes the tax obligations of prospective activities or transactions and advises your finance team on the best possible options for your business.
A tax advisor can help you decide the proper structure for your business and to register your business as a sole proprietorship, a partnership, or an LLC, depending on your investment industry and the laws in your state.
Some business moves and transactions that can expose you or your business to tax liabilities include staffing, new acquisitions, new investments, specific utility bills and expenses, retirement plan contributions, etc.
A tax advisor can examine these moves’ financial viability and tax sense, assess the associated risks, and advise you accordingly to help you reduce your tax burden.
Consult a tax professional when confronted with cash flow problems and unpaid or overpaid accounts for advice on mitigating the borrowing and claim processes without incurring unnecessary expenses and tax overheads.
Paperwork
A tax advisor can help to analyze, arrange and file the requisite tax paperwork for your business. These professionals can read through the fine print of any deal or legal agreement and interpret their financial and tax requirements.
Tax consultants can also advise you on tax obligations concerning new deals or partnerships with your business. They can also give you the requisite data to complete your tax return forms.
Management of Tax Records
A tax advisor can help you set up or organize tax information about your business’s rental income, trusts, and other income-generating channels. You can also consult your tax professional on certain life events like births, marriages, death, or divorces and have them analyze the tax implications of these events for your business.
Working with a tax advisory agency like Asena Advisors gives you access to tax advisors specializing in various tax areas like corporate, international, or income tax laws.
These specialists can help consolidate and significantly prepare tax information on various business aspects when expanding your operations to different industries or countries.
Your tax advisor can help you ensure you pay the right amount of taxes and that your records are up-to-date with current rules and regulations.
A tax advisor can also help you and your employees file their taxes appropriately and on time to avoid legal issues. Your tax advisor may also give your financial team in-house training on tax analysis and preparation for accounting purposes.
Representing The Financial Team At Audits
When faced with an audit in your business, it is advisable to have your financial and tax records prepared as presented by a tax professional as they have the requisite knowledge and understanding of tax regulations specific to your business.
Your tax advisor can deduce the necessary tax information from your business record and explain it at an audit better than other financial team members.
A tax advisor also knows how to interpret the audit requirements and recommendations before and after an audit and advise you accordingly. Tax advisors combine accounting and legal knowledge with helping solve, prepare and communicate your business’ tax obligations to the finance team, audit firms, and a court of law in case of a tax dispute.
The tax professionals may also offer you legal representation to avoid or reduce suffering losses in tax claims and compensations.
Other than interpreting and helping you comply with existing tax regulations; a tax advisor can also help you evaluate new tax laws to help you position your business for success in the future.
They can also double up or step in the shoes of accountants and financial advisors if and when needed. You can consult a tax advisor to help you consolidate or separate your business and personal finances and steer your business to success accordingly.