I am almost sure that the laws regarding Revenue and Taxes are very similar internationally.
No business person/Self employed person wants to pay too much in tax while the Rich thieving Elite and Major Companies pay Fuck All and get away with it.
Swali ni hili hapa; a friend of mine just Filed his Taxes for the Previous Business year and he has managed to get a massive Tax Bill.
He feels that he is being “penalized” for working Hard.
His accountant hinted on a few ways for him to try and bring his tax down by inflating a few costs but there was only so much the accountant could do without breaking the Law.
Now that you are Anonymous here;what ways would you suggest as “tricks of the trade” to help “My Friend” reduce his tax bill in the coming Financial year?
My friend is Not being Greedy and he understands that maintaining a Healthy Profit is important for him in attaining Credit etc… He just needs some education on these things.
I am not an accountant. I am not registered with KRA for 4 years now as a tax consultant. I dont have HR experience for 13 years remitting taxes. Neither did I take my pin 17 years ago and soon started paying taxes. I dont have a company that has been paying taxes since 2006. I havent done creative tax submission for indian firms in Nairobi for 9 years now. I dont have all these.
So take my advice with a pinch of salt:
[ul]
[li]Did he buy an asset? I am sure the accountant applied capital deductions [/li]
[li]Inflate staffing costs[/li][li]Inflate delivery costs if dealing with goods, [/li]
[li]If a consultancy, inflate incidental expenditures down to even transportation and taxi[/li][li]Pay himself a market premium salary, if a company[/li][li]Inflate company car fueling costs[/li][/ul]
Thankyou so much.
My friend got similar advise from another friend of his and he really appreciates that part about Buying assets because he lost all the reciepts to some “assets” (some of which were given to family and friends as Christmas presents)
But he now knows better.
My friend has also been asked to Form a Limited Company as opposed to being self Employed.
What is your take on this?
He was previously worried that he would be an easier target for “scrutiny” from the Revenue people if he formed a Limited company as opposed to being Self Employed.
Any advise on that?..
A limited company is the way to go. There’s always more opportunities to lessen tax burden for companies as compared to individuals. I wish he had known this earlier. A company being a separate entity is a very good protection.
Excellent advise there.
My friend will be very grateful because he is also considering branching out into Property Development.
Is it true that there are “loopholes” that allow a Landlord to include the mortgage payments on their “own” house as a Company Cost?
Yaani ile nyumba you as the company director lives in with your kids.?
The house has to be registered as the company’s
Which is standard even here in kenya
Tell you what, there was a time when citizen tv used to run a name-and-shame segment for cars driven badly
Most of the luxury cars caught on tape were registered as company owned but really owned by kina politicians
Why did they do that?
In the end, a company recovers the total cost of purchasing and delivering the car to its yard from taxation as capital deduction
That is true plus being able to award yourself benefits like Company car,Fuel etc all the way down to taking a bunch of your friends to Whitesands Hotel pale Coast and Claiming it back as a Conference cost etc…
Shida ni when you are Self Employed.
Hapo ndiyo panaleta kasheshe.
yap … the beauty of everything taxation si the principle of self assesment
Tax authorities just wait for you to asses yourself on how much you should pay. And as long you are a small wig, you are most likely to escape some of these things. Shida ni snitches.Disgruntled employees mostly accountants
Rats!
juzi @aviator amesema vile anaeza snitch landlord ndo apewe hata ka ni 500shs. Yaani sijawahi ona panya
Aha!..
The House has to be Registered as being a Company Asset!.. (light bulb moment!)
@Bingwa Scrotum you are now Officially a Close friend of mine and my Consultant.
Hayo mengine tutaongea kule inbox.
Asante sana Boss.
I always hated school and i lack the Patience to sit in a Lecture hall for more than two minutes so i guess i will have to form friendships with people in the know and learn as i go along.
Cheers mate!
Fukcing Right bro!..
Ukicheza chini you can get away with Murder lakini the moment you start having an official Payroll. Utamulikwa and god save you if you have @aviator on your payroll na roho yake mbaya.
That is why i am researching this thing of forming a company really carefully…(well, myfriend is anyway…)
