Tips – On Individual Income Tax: Away from Tension and Pay Taxes

Friends, Today, there exist a number of income tax schemes in both the financial market and the employment arena. They vary in severity of their tax incidences. The tax chargeable on the entire income of individual employees or individual self-employed people is known as individual income tax. These taxes can be categorized as either being proportional, regressive or progressive. The base for taxable income for individuals is their total income.

Generally, individuals want to pay less and less tax, thus it is important for them to take charge of their tax affairs by being careful with their financially affairs. All expenses, incomes, savings, etc must be articulately recorded. This is for aiding the individual tax payer to arrive at the correct figure they owe to the tax man. There is no need to rush at the last minute so as to calculate the due individual income tax. This becomes very stressful and an individual might miscalculate their income tax leading to problems with the tax authorities. Below are some individual’s income tax tips to assist an individual to beat the taxman’s deadlines. * Be careful with both the taxable and allowable expenses when filing in for individual income tax. For example:

1. Traveling expenses

A schedule of distance traveled must be kept to aid in accurate calculations of an individual’s traveling deductions. Travel expenses such as, cost to conferences, seminars, airfare, taxi charges, parking fees, car rentals and other work related form of traveling expenses are deductible.

2. Expenses related to entertainment.

As from 1st March, 2002, the government declared that no deduction against the entertainment allowances is allowable for individual’s personal motives. So, all entertainments allowances must be declared to the employer by the individual employees for the allowances to be fully taxed.

3. Most Medical expenses are deductible.

Accurate records must be kept detailing all medical expenses which are not taken care by an individual’s medical cover. Reckoning on an individual’s gross income, health insurance which includes dental insurance payments must be registered as deductible. For non-deductible own medical expenses, they can be converted into a legal business expense.

* To beat the rush to the individual’s incomes tax department, taxable income must be calculated in advance. Failure to do so imply that an individual can not beat the income tax deadlines resulting to hefty penalties. The tax returns to tax bodies such as Internal revenue service must be submitted before the due date, failure to so, the tax man will be after your neck with all the due force, to enforce the tax payment.

It is an actuality that most people are quite worried when it comes to end of the year-the tax man is after their necks tax-wise. Thus, it is advisable to start the preparations of your tax affairs in advance so as to take advantage of any entitled tax escape.

Posted in: Income Tax,Relief on Tax Tension