Accountant Perth WAAccountant Perth WA
Paying taxes is one of the major responsibilities involved in running a business. There are four small business structures in Australia, and different tax rates apply to different structures. So, before you set up your business, it is important to be aware of all these obligations. In addition, taxation also involves certain risks that you must reduce to ensure better business health.
A tax accountant Perth may come in handy in such situations, and so, while drafting your business plan, you must consider hiring a professional. Read this blog to learn about these risks, the importance of managing them, implementation techniques, and the ATO’s support.
When a company fails to pay the correct amount of tax, it leads to various business tax risks. It can also occur if the tax positions and the company’s risk appetite do not match properly. For this reason, in addition to financial risk management, tax planning, and tax compliance, companies have to also think about tax risk management as a part of their business plan.
It has happened due to the following factors:
All these factors have resulted in new risks and increased the need for companies to keep pace with developments in the global tax scenario. In several states, tax authorities expect businesses to mitigate tax risks to a manageable level.
Every business organisation must manage taxes in a way that will also help them develop an overall business strategy.
In the past, managing tax risk was more straightforward than today, which mostly involved keeping the numbers right. But now, as the global tax world demands greater clarity, accountability, and real-time compliance, tax risk management has become more challenging.
Nowadays, tax risks may lead to serious consequences for companies in terms of penalties. Also, if you fail to maintain compliance with taxation rules and regulations, it may impact your company’s reputation significantly.
That is why businesses must take the necessary steps to perform their tax functions and focus on several factors.
Besides promoting governance and reducing tax risks, implementing tax risk management strategies will also help in the following ways.
Businesses need to develop better tax governance practices in the present tax scenario. It can be achieved by developing an efficient internal control and tax governance framework, testing its suitability against the best global standards, and demonstrating the operational effectiveness of the control framework to all stakeholders.
If you want to achieve it with your company, make sure your executive board implements the following steps.
First, identifying and assessing current tax risks in each department of your company is necessary. Data of such an assessment will help you fulfil the gaps between your actual position and the tax governance position you must be in.
These days, businesses, irrespective of their size, must be prepared to tackle any risk, including dealing with aggressive audits, managing reputational concerns related to taxation, or assessing existing business structures. In short, businesses must have the ability to adapt fast to the changing environment.
As information sharing has increased among tax authorities, the chances of reputational risks have also increased. That is, staying updated with rapidly changing tax laws is important. Also, if your business serves the international market, you must maintain a global perspective.
As tax authorities are becoming largely technology-dependent, this step is highly important. It will be great for your business if you quickly adopt technologies like:
Besides helping in tax filing and tax assessment, these tools can provide overall assistance for your business.
The Australian Taxation Office (ATO) has developed tailored strategies according to client behaviour to help small businesses improve their tax performance. They first analyse the whole population to understand different small business behaviours and the risks associated with various business essentials like BAS registration and lodgement, expenses, income, payment, and engaging labour.
At this moment, their priority is to focus on various preventative, compliance, and influencing actions. In addition, they have also increased data usage to tackle constantly changing risks and support small businesses in better ways.
Accountant Perth is a top-ranked firm in Perth, which offers a wide range of services in finance and accounting areas. The firm has a dedicated team of tax risk and strategy specialists who have significant experience handling various tax issues across all sectors. Their skills in tax risk assessment and assurance will help you remain compliant with the ATO tax regulations.
When it comes to reducing business tax risks, tax experts of this firm can help your company in the following ways.
So, the next time you need help with tax filing or tax risk management, contact them for a free consultation.