Best Practices for Small Businesses: Make Tax Compliance and Expense Reporting Easier Year-Round

Every day – and every expense – provides an opportunity to improve how your business tracks expenses for tax purposes, monitors for compliance and risk management and stays audit-ready. For many small to mid-sized businesses (SMBs), this can prove challenging and feels impossibly time-consuming, especially when they’re already strapped for time, money, and resources. Tax rules and regulations are in a constant state of flux. Your business priorities, plans, and budgets are also prone to change. You don’t just have to be ready for tax season each year; you must be ready for anything, anytime.

This checklist provides seven best practices to help your SMB build a strong tax, governance, and compliance foundation, all without additional strain on your staff and resources. Here is the preview of the first three best practices.

1. Unify all tax-related expenses and invoices in one system: a single cloud-based system that allows you to capture and manage all business- and travel-related expenses, receipts, mileage, invoices, and any tax-related documentation in one place can greatly simplify the process easier to gather and review tax documentation whenever needed.
2. Automate manual expense and invoice processes: Automate as much manual work as possible, including the manual work involved in reporting expenses, managing axes, and capturing and managing invoices and receipts. This frees up your manager’s and AP staff’s time, allowing them to focus on analyzing and improving your company’s spending, taxes, and cash flow.
3. Understand the tax implications of hiring remote workers: hiring remote workers can be an attractive option for your SMBs, but it can also complicate taxes, compliance, and expense reporting. Using technology with an AI-embedded system can help you automatically identify taxable employee benefits, such as internet fees and home office equipment, from the expenses that your remote workers submit so you can be compliant with local tax and other expense-related regulations.

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