Annual returns. The dreaded topic in the midst of spring each year that haunts every single company, no matter how big or small. Filing annual returns has been a troublesome or even downright operationally impeding process.
Despite it being a vital part of running a business by legislation, filing annual returns doesn’t have to be difficult, complicated or time consuming if done correctly.
So when do you, as a small business owner in Singapore, prepare for filing your annual returns?
Start Early. Or Regret Later.
Many business owners put off annual return filing to the last minute. This is an extremely bad practice. The following are just some of the reasons why it is so bad to do so:
- You WILL lose certain transactions over the year if you did absolutely no financial accounting
Most small business owners find it hard to keep track of their 365 days’ worth of business transactions and papers. This tends to mean that invoices and receipts get lost along the span of the year – making the filing process that much harder.
Start from day 1 – a simple Excel sheet and a basic filing system will do if you’re just starting out. It doesn’t need to be complicated, and you can find a lot of Excel templates on Google.
- You Pay More
When it comes close to tax day, many businesses are scrambling to finish up their annual returns. Accountants get swamped with requests in the months leading up to the filing deadline. As a result, they raise their fees, and you’ll have no choice but to pay more.
- High possibility of delays and errors
When filing returns close to the tax-clearing season, there is a high chance of certain essential Regulatory and Bank materials being delayed past the deadline of annual return filing. There’s also a higher chance of making mistakes because you’re rushing. You don’t want to run the risk of being penalized because of errors or missed deadlines. Starting early allows you to pace yourself and gives yourself more breathing room to deal with unforeseen circumstances.
Many small business owners struggle when it comes to the issue of filing Annual Returns time and again, and often fall into the trap of waiting to the last minute to do them. By setting up a simple accounting method from day 1, you’ll set yourself up for success, and not be stressed out when tax time comes.