. Why do so many of
us wait until the last moment and then scramble
to get it all together? The best procedure is to
carefully save and record all tax receipts.
Record everything on a regular basis, daily if
possible, but never procrastinate longer than
monthly. Weekly is preferable to monthly,
because memory is not a reliable technique.
There must be an audit trail so each deduction
can be easily
explained.
Create
deductions!
By that I do
not mean to dream them up. I do mean to record
all permissible deductions meticulously. Know
what is an allowable deduction. Many people
overlook acceptable deductions, and it is not
the place of the tax department to find them and
point them out.
Planning
Keep good records of your
expenses
. It is an
extremely important to keep consistent records.
For example, there are two acceptable methods of
recording automobile business mileage expenses.
You can record every kilometer or mile driven
for business each day and charge a specific
amount such as thirty-five cents per mile or
kilometer (up to 0.41 for the first five
thousand km). Otherwise a good technique is to
note the odometer reading at the beginning of
the year. At year-end, record the new reading.
Then you can take a reasonable percentage of the
total traveled. It should be demonstrable that
the calculation is reasonable.
Meals bought for clients or
prospective clients.
Business luncheons should be carefully recorded
and backed up with receipts. Some business
luncheons may be fully deductible. When you are
out of town on business you can generally
deduct a reasonable amount for daily expenses.
You are allowed a reasonable meal expense when
you are away from your residential city on
business. Make sure you have a method of
differentiating which meals are one hundred
percent allowable expenses. Keep separate
records.
These are only a few examples of the
many possible deductions you can create. In this
context, create means knowing what you can
deduct. It means keeping receipts, and it means
recording everything carefully.
For a list of
common deductions go to an article entitled
Ten Timely Tax Tips.
There are more than ten, of course,
but you can choose those that apply to you.
Please Note:
Nothing in this newsletter should be
taken as an attempt to interpret laws, or to
offer advice on legal or accounting matters. The
purpose of this information is to provide ideas
about preparing your material for your
accountant or lawyer. Always consult the proper
authority for advice. We cannot accept any
responsibility for your decisions based on this
article. Some of this information may not be
appropriate for some individuals. Some of it may
not be allowed in your locale. Check it out
before proceeding with any activity based on
this information
What can we do for
you?
This is the first of our newsletters.
Our plan is to publish one every month. Each
month we will provide information on financial
matters of general interest. Whenever possible
we will point you to articles or information
that may be valuable to our readers. Next month
the theme will be Investing
to Save on Taxes.
"Chimo Says" is strictly opt in. You
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going to tha About Us page at:
Visit all the pages in our website
to discover lots of useful information.
Free articles and e-books may be
found on our site.
Do your own private needs analysis
for retirement planning or for your life
insurance needs.
Get a confidential quote. No one
will even know you were there unless you want
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If you are from the USA and you want
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calculations.
Humour
Section:
Here’s an oldie but it is a classic.
I have been using it in Financial Planning
seminars for many years
now.
"One couple, after taking the seminar
did exactly as they were advised to do. They
reviewed the need for money at death and where
it would come from. They considered their choice
of traditional burial or cremation. And so on
through the entire list.
When the discussion was complete, the
husband turned to his wife and said, "There is
something else I would like to
know."
"What’s that dear?"
"Well, would you remarry if I die
first?"
"Of course, dear. Most people who
have had a happy marriage like ours would want
to get married again."
"Would you continue to live
here?"
"Probably. I like this house. It’s
paid for and I like the neighborhood. I have
many friends here. I see no reason to
move."
"Well, would you let him use my new
rec. room after I worked so hard building it
during the last two years?"
"Dear, if he is living here you can’t
expect me to tell him that he cannot use a
particular room because my husband built it.
Wouldn’t that seem a bit silly?"
"Well yes, but there is something....
Would you let him use my new $2000 golf
clubs?"
"Of course not dear. He’s left
handed!"
(More like this in my book
"Laughing at Life"-- available from our order
page.)
Tip of the
Month:
If you say or write something which
has an impact on people, your name will live
forever. ~ Anonymous
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