
A lot of people are busy getting their taxes ready in order to get them filed on time. The problem is that a lot of owners are deciding how to handle their business tax situation way past the point where they could have really had a meaningful impact on what they will have to pay.
In my continuing quest to help you turn your company into the most profitable machine possible, here are 10 suggestions that I believe will drastically affect the taxes that you will pay next year. The order can be adjusted based on your perception of what is most important to you, so consider:
1. Get Out and Get Business
You, as the owner, need to spend up to 80% of your time going out and securing business for your company. The owner is the best salesperson a company has. No one has as much skin in the game, and no one has worked as hard to get the company where it is today. No one has as much to lose: no one in the company mortgages their home, their lifestyle, their assets and the future education of their kids. If you succeed, it’s going to be good; if you fail, you will spend the rest of your life repaying the debts incurred.2. Recognize the Need to Hire
The owner starts the company and in the beginning does all of the sales (and often, the spouse does the bulk of the administration, in between running the home life with growing kids). The owner does all of the work needed to produce the job. As the company grows – if it grows – the owner needs to hire people to help with some of the work.Because the owner has done most of the jobs in the company, he or she is able to mentor new company members in the goings on with regard to procedures, attitudes and culture.
3. Get a Second Opinion
Estimates need to be reviewed by a second set of eyes. Before an estimate is presented to the potential buyer, a second person should check for such items as math errors, missing items and be able to answer ‘yes’ when asked, “Does the estimate also indicate what you will not do? Does the estimate make sense to all concerned in the job process?”4. Keep Track of Your People
All employees of the company need to turn in a timecard daily. The individual’s card needs to identify the task(s) performed and the time it took to do them. This data needs to be used to determine if the employee is doing what needs doing, and doing it as efficiently and as effectively as possible.5. Let Technology Help You Get Organized
All purchases need to be done using a purchase order system that works with your accounting software. A purchase order system will allow the company to compare estimate amounts to what is actually being spent.