Posts

Applying for a Small Business Loan: 5 Steps to Success

Financing is a fact of life for any business, whether it’s to fund a new start-up, expand/update your existing business, or solve a temporary cash-flow issue. The best way to be successful in getting that loan is to be prepared with all the answers a bank needs to decide in your favor.

Here are 5 suggestions to pave the way to being approved for a business loan.

1. Research potential lenders online

Don’t just consider large commercial banks. Other, possibly easier, options include:

  • Smaller regional banks
  • Credit unions
  • Micro-lending organizations
  • Online marketplaces

2. Know your credit history and credit score.

The lender will definitely be checking to see whether you are able to repay their loan. If there are any errors or red flags that you can fix, get it done before they request the report.

Here are some steps you can take

  • Pull a fresh credit report online
  • Review and challenge discrepancies

3. Obtain expert advice.

There’s no point in flying blind when free help is available for the asking.

  • Consult your trusted advisors
  • Speak with fellow business owners

Check out episodes of “Shark Tank.” Although the “Sharks” are investors (becoming part owners of the business), not lenders, you’ll get an idea of the questions a loan officer might ask you.

4. Update your financials

Up-to-date monthly balance sheets and profit and loss statements are a great indicator of a business’s financial health. Understanding your historical business performance will give your lender confidence in your business’ direction.

To demonstrate your credit-worthiness, include documentation such as:

  • Past financial statements
  • Assets you will use to secure the loan, such as a property you own or purchase orders from your customers
  • Brochure, website link and other marketing materials for your products/services

5. Choosing the right loan vehicle

In today’s ever-changing business environment, there are many types of loans from purchase order financing to secured, unsecured, lease or purchase.  Depending on the type of loan to choose varies based on:

  • Desired end result
  • Interest rate importance
  • Terms of the loan

If you need help putting together the financial plan for your loan application, your dedicated Xendoo CPA team can provide you with your balance sheets, profit and loss statements, tax returns and more. Let’s get started!

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.

 

5 Things Small Business Needs to Know About the New Tax Reform Law

The good news: lower tax rates. The bad news: fewer deductions.

Although you won’t be filing a tax return based on the new law until 2019, you will have to abide by its provisions starting right now. Here’s an overview of the top 5 changes that could significantly affect your small business operations.

1. Lower tax rates.

Pass-through entities (S corporations, LLCs, sole proprietorships, and partnerships): This means that the net income from your business is “passed through” to your personal tax return. Until now, this income was taxed at the same rate that individuals pay. Under the new law, you can take a 20% deduction on that income. There are some exceptions, though, such as most service businesses whose taxable income exceeds $157,500 for single filers and $315,000 for joint filers.

C corporations: Until now, there was a graduated tax structure, up to 35% of income. All that has been replaced by a flat rate of 21% for all C corporations.

2. Higher bonus depreciation.

Over the past several years, it seems like the rules changed every year for what percentage of “up-front” depreciation you could deduct on equipment or real estate purchased for your business, rather than writing it off over a period of years. This may make not only figuring your tax, but also tax planning for capital expenditures, pretty tricky. For your 2017 return (which you’ll be filing this year), bonus depreciation is 50%. Starting with your 2018 return, it’s 100%; and it will then be phased out completely over the next 5 years.

What’s more, this deduction can now be applied to “used” as well as new items, as long as they comply with the other terms of the provision.

3. Expanded availability of cash accounting.

Cash accounting means that a company records income and expenses when they’re received or paid. With accrual accounting, a more complex system, income, and expenses are recorded when they are owed. Under the old tax laws, a business couldn’t use cash accounting if its annual gross receipts averaged $5 million or more for the prior 3 years. That ceiling has been raised to $25 million. This should simplify things especially for businesses that carry inventory.

4. Fewer deductions and credits.

We’ve listed a few of the ones most often claimed by small businesses:

  • Business interest expenses: Reduced to 30% of taxable income. However, this rule doesn’t apply to businesses with an average annual gross income of $25 million or less.
  • Entertainment expenses associated with the conduct of business: Repealed.
  • Transportation fringe benefits (mass transit passes, parking privileges, etc.): Repealed. However, if you continue to provide this benefit, it will be tax-free for your employees.
  • Per diem rates at which you reimburse your employees for business travel expenses: No change.
  • On-site eating facilities: Reduced from 100% to 50%. However, if you continue to provide this benefit, it will be tax-free for your employees.
  • Domestic property activities (Section 199): Repealed.
  • Net operating losses: You can no longer carry them back for 2 years, but the 20-year limit on carrying them forward is eliminated. You can deduct up to 80% of taxable income.
  • Paid family or medical leave: There’s a new credit ranging from 12.5% to 25%, depending on the amount you paid your employee.
  • Business property costs (Section 179): A bit of good news is that the amount you can deduct has doubled from $500,000 to $1 million; of course, that amount can’t be more than your income. And the phaseout ceiling has increased from $2 million to $2.5 million

5. Higher contribution caps for retirement plans.

If you offer a retirement savings plan to your employees, the amount you and they can contribute may have been increased.

  • 401(k), 403(b) or 457: Increased from $18,000 to $18,500. The maximum for participants over the age of 50 making “catch-up” contributions has also increased, from $24,000 to $24,500.
  • IRA and Roth IRA: No change, $5,500 for those up to age 49 and $6,500 for ages 50 and up.

Xendoo stands ready to help you sort out these complex new tax provisions, and take full advantage of the breaks they offer to small businesses. The time to start planning is now!

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.

 

5 Simple Business Tax Steps to Take Before December 31

In just a couple of weeks, the tax year will come to an end. So this is your last chance to make the moves that will maximize your 2017 return’s accuracy and minimize the taxes you owe.

1. Consider new equipment purchases.

You might be thinking you’ll wait until the first quarter of 2018 because cash flow will be better then. Think again: buying before year-end lets you use Section 179 or other tax benefits and take some of the purchase prices from the money that would otherwise have gone to the IRS.

2. Determine your tax bracket.

Review your 2017 profits with your CPA to figure out exactly what percentage rate you will be taxed at. Once you know that amount, you can more easily manage cash flow, plan for the first quarter of 2018, and make informed decisions about such expenditures as employee holiday bonuses or leasehold improvements.

3. Check personal credit cards for business expenses.

Situations where you can’t pay with the company card happen to every business owner. So you give the supplier your personal card. And in the fast pace of daily operations, it’s easy to forget to reimburse yourself for those expenditures. Now is the time to move that money where it belongs.

4. Pay state tax now.

If you pay your state tax in 2017, you can take it as a deduction on your 2017 return.

5. Do a year-end inventory reconciliation.

Why pay tax on merchandise that’s unsellable, or just plain not there? Your reconciliation should account for spoilage, shrinkage, returns, and out-of-date products.

Bonus tip: Utilize Xendoo’s catch up services.

Xendoo understands that, as a small business owner, you wear many hats and have next to no time to keep on top of accounting and bookkeeping. You may have been behind for years, yet we can usually bring your financials up to date in a week. It’s that easy to start the new year with peace of mind about the state of your business … not to mention the tax savings we just might find!

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.

 

Lifting the Burden of Back Taxes: It’s Easier Than You Think

First, let us assure you that you are not the only one with back taxes hanging over your head. At Xendoo, we help business owners regain their peace of mind every day; and in many cases, there are things we can do to lessen the impact you’re fearing.

Here are some reasons to get that monkey off your back now and start 2018 with a clean slate.

3-year limit on claiming refunds.

What if you were actually owed a refund for one (or more) of the years you didn’t file a return? The government only honors refunds for three years; so, every year you let go by could be more money lost forever.

When we bring your financials up to date, we’ll make sure you receive every tax benefit you’re entitled to. You might find that you owed less tax, or were due to a bigger refund than you thought.

Late penalties and interest never expire.

The longer you let your back taxes slide, the more you’ll pay over and above the actual amount of the tax. And unlike with refunds, the government has no time limit on collecting those debts.

You may qualify for a penalty reduction.

Life happens, and sometimes you just can’t pay your taxes on time because of circumstances beyond your control. The IRS makes allowances for this by providing small businesses Penalty Relief Due to Reasonable Cause. According to the IRS website, typical reasonable cause situations include:

  • Fire, casualty, natural disaster or other disturbances
  • Inability to obtain records
  • Death, serious illness, incapacitation or unavoidable absence of the taxpayer or a member of the taxpayer’s immediate family
  • Other reason which establishes that you used all ordinary business care and prudence to meet your Federal tax obligations but were nevertheless unable to do so

You may not have to pay it all at once.

Our tax experts can advise you on making a repayment agreement with the IRS. Just remember that the longer you take to pay your debt, the more interest will accrue on the unpaid amount.

Delinquent taxes affect your credit score (and more).

This debt could be costing you in ways you haven’t even thought of. Everyone from landlords to lenders to suppliers will check your credit report, and give you a worse deal (or no deal at all) if it doesn’t meet their standards.

It’s all too easy for back taxes to grow into a mountain you’re afraid to climb. But with Xendoo’s tax catch up services, you can rest easy that experts are digging through that mountain and finding every possible way to take the load off your mind.

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.

 

Rolling in the Dough: 5 ways to make your restaurant or food truck more profitable

The restaurant business can be growl- I mean, grueling. An astounding 60% of restaurants close or change ownership in the first three years. If you plan to beat the odds, you must focus on making your restaurant profitable as soon as possible. Here are five ways to make sure you’re not leaving any profit on the table.

1. Know your numbers

Do you know the exact percentage of your food cost during any given time of year? Do you forecast sales and use those figures to schedule staff and control inventory? If not, it’s time to get a handle on your restaurant’s numbers so you can make decisions based on more than your gut. Here’s even more on controlling your food/labor costs and how to prevent food waste.

2. Determine your role and hire the best

When it comes to operating a restaurant, it may not be a bad thing to have too many cooks in the kitchen. Beginning with a great front-of-house that warmly greets customers and manages crowds, to servers who are on their a-game, all the way back to solid cooks, bartenders, and bussers – hiring experienced, teachable staff, helps guarantee a great customer experience every time. But don’t rely on what they already know: making sure your team is trained and updated with weekly meetings help them help you run a better restaurant.

3. Offer a take out menu

Take out orders do two great things: keep your kitchen busy and leave the dining room open for more customers. Offering a modified version of your menu for hungry diners so they can take your food home will help you bring more bacon home (see what I did there?).

4. Put customers first

A disappointing dining experience may not just stay at your restaurant. With the ability to “check-in” online, leave reviews, or even just rant to their personal followers, diners now have a megaphone to share their experiences and they won’t be afraid to use it. That’s why it’s more important than ever to make good on a bad meal before the guest gets their check. If you need to, comp a dish (or the whole meal) or offer a free dessert. And don’t forget to give a coupon good for a future visit so they give you a second chance. The loss you’ll take on these items is far less than the loss of customers resulting from a poor online review.

5. Don’t wait till it’s too late to market

Even if the business is booming, restaurant owners should never rest on their laurels. The scene is always changing and new competition looking to steal your lunch could pop up at any time. Always have a solid marketing plan in place that, at the very least, includes an attractive, easy-to-use website and updated social media pages. When you’re ready to take things to the next level, get creative with digital marketing, local print advertising, or mass marketing tools like radio and TV.

Follow these five tips and you’ll be on your way to a more profitable restaurant or food truck. If you’re looking for even more ways to save during tax time, check out Seven Tax Tips for Restaurant Owners.

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.

 

Happy Hours: A growth guide for service professionals who charge by the hour

Do you run a business that charges clients by the hour? Whether you’re an accountant, lawyer, designer, or consultant and you’re ready to expand – or hope to one day – there are a few things to consider to make sure your growth strategy is profitable.

Let’s start with the basics…

How does the billable hour pricing model work?

“Billable hours pricing” is a method used by many different services with one thing in common – customers pay by the hour. Businesses that use this model estimate the maximum number of hours in a year that they can generate revenue, and use that number to set hourly rates. Here’s an example:

Dr. John Watson owns a private investigation firm and is the sole investigator. He plans to work a typical 40-hour workweek and take two weeks off for vacation.

40 (hours per week) x 1 (employee) x 50 (workweeks in a year) = 2,000 billable hours

But Dr. Watson is not a robot and has to plan time during the workweek to eat, travel to clients, and handle administrative work in the office. He estimates this will take about 1,000 hours.

2,000 (billable hours) – 1,000 (non-billable hours) = 1,000 maximum billable hours for the year

Watson has already determined that his business’s operating expenses (marketing, administrative, office lease, etc.) will be quite low since he is well-known and works from home. He uses that figure to set his break-even rate.

$20,000 (total expenses) / 1,000 (maximum billable hours) = $20 per hour

If Watson charges just $20/hour, he’ll be able to cover all of his expenses. Anything higher than this number will go straight to the bottom line, which is why he’s decided to charge $60/hour.

So what you’re saying is I should just bill more hours, right?

Unfortunately, it’s not so elementary. Looking at the last equation above, you’ll see that lowering expenses, increasing the number of billable hours, or increasing rates could all send profits skyward. But if you’re a sole proprietor and many of your expenses are fixed, what are you to do?

Grow my team?!

If Dr. Watson hired a junior investigator at $30,000/year…

$30,000 (salary) / 2,000 billable hours = $15/hour nominal cost

could he simply re-bill her at $30/hour? Keep in mind that you have to account for federal holidays, employment tax, vacation and sick time, in-office work, and training for new staff. When all is said and done, the true cost of an employee is actually double their “nominal cost,” which means he’d have to re-bill his junior P.I. at much than $30/hour to make a profit. Expanding your staff could be the answer, you just have to be sure the numbers work out.

So, hire several more people all at once?
This could also be a solution, but with more employees comes more clients to maintain employee turnover, and a need for more office space and support staff. Hiring subcontractors, versus full-time employees, does offset some of those issues, but subs typically charge higher rates since no one is covering their vacation time and health insurance.

Can’t I just increase my prices?

If Dr. Watson increases his hourly rate from $60 to $70, this $10 increase would yield $10K more in pure profit. But he risks driving away loyal clients or attracting a different type of clientele that come with challenges he hasn’t faced before. Increasing your rates is a viable solution, as long as your customers are prepared and see a good reason for it.

As you can see, growing a billable-hours business can be done in a number of ways, but you’ll have to use your powers of observation to determine which method makes the most sense for your business.

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.

 

Sales Tax Nexus: How States are Closing the eCommerce Loophole

Once upon a time, retailers didn’t have to collect or remit sales tax on merchandise sold to out-of-state customers. Period. But with the phenomenal growth of online shopping over the last couple of decades, states realized they were missing a huge revenue opportunity. And so sales tax nexus was born.

The nexus concept basically says that if you have significant business connections within a state, you are obligated to abide by its sales tax laws. Although they vary from state to state, here are some of the most common factors:

  • Your location — headquarters, branches, stores, warehouses, other real estates
  • Drop shipper or distributor location
  • Employee location — sales reps, delivery people, contractors
  • Advertising and referral services location — including click-through advertising
  • Economic nexus — exceeding a total sales dollar amount and/or number of transactions within the state
  • Regular event attendance — trade shows, consumer fairs

To make things even trickier, states continue to expand their remote seller nexus rules, necessitating that you check regularly for the latest requirements.

eCommerce giants like Amazon have found it easier to simply register in every state as a preemptive strike against future regulatory and compliance hassles. For smaller businesses, this may not be a cost-effective solution. So how can you bullet-proof your sales tax strategy?

Read the rules.

Check with the taxing authority in each state where you think you might have nexus, and register for a sales tax permit when/as required. Also, you will be collecting tax based not on your home state’s rules, but on those of each state. So you need to know percentage rates, whether or not shipping charges are taxable, what classifications of merchandise are exempt, remittance due dates, etc.

Make sure you’re collecting tax on all channels.

For example, you may already be set up to collect sales tax on your own site. But if you start selling through Amazon’s FBA program, you may need to set up for some new states where Amazon is storing your inventory.

Notify the state when you no longer have nexus there.

Maybe you’ve moved your headquarters, or terminated your relationship with a distributor. Call or write the state’s department of revenue so they can update their records before the next return is due. Also, be aware that some states have “trailing nexus” that lasts for up to a year after your nexus in the state ends; you may have to file another return even if it’s for zero dollars.

Automate the process.

Good software makes compliance a breeze. Sales tax registration, returns, remittance, due date notifications, regulation updates, reporting tools and records maintenance, all done in just a few clicks, are some of the ways it can save you much time and effort.

Over the next few years, we expect that states will continue to close loopholes and challenge old legislation. Staying current will be the key to minimizing the time you spend on sales tax collecting, reporting, and remitting. And having the right processes and tools in place will be more important than ever.

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.

 

7 Time Savers for Service Retailers

If you’re a retailer with a service offering, there might be nothing more valuable than your time. So whether you run a salon, gym, or dry cleaning business – If you feel like there just aren’t enough hours in the day, read on.

Here are seven time-saving tips so you can spend more of your valuable time with customers and grow your business.

1. Track it

The best way to know where you need to save the most time is by taking a brutally honest look at how you spend it. A few minutes checking email here, a few more looking up at the ceiling there – before you know it, precious hours have gone by. A simple notebook or free time tracking app can help you get a real handle on your time management before the day gets away from you.

2. Let go

As a business owner or manager, there are areas of your work you’re very proud of and probably can’t imaging handing off to someone else. But one of the most important aspects of leadership is delegating tasks to others. Not only will it free up your time to focus on the bigger picture, but it will give team members you see potential in the chance to develop and grow.

3. Outsource the non-essentials

Look hard at the areas of your business you struggle with or that take up more time than they should. If there isn’t a dedicated person on staff to handle them, outsource it. With Xendoo’s bookkeeping services, you can spend less time crunching numbers and use that data to make decisions to help you grow.

4. Get your head in the clouds

Do you have business files and data spread across offices and computers? By consolidating everything into one place and using cloud storage like Google or Dropbox, you save time wasted searching for info and can access it from anywhere. You can even manage permissions so different team members have access to only what they need.

5. Join us in the 21st century

After you get all your data loaded in the cloud, look at updating your company’s software and technology. If you’re using outdated POS software or equipment that is slow or fails, you could be wasting valuable time. Fortunately, there are dozens of free and affordable options that make this easy to do.

6. Make your space work for you

Whether in your back office or at cash out, having everything needed to get a single job done in one place helps the task go smoother and faster. That might mean an initial investment in more equipment, but your newfound efficiency will pay off in the long run.

7. Don’t be afraid to automate

From communications to billing and invoicing, is there an aspect of your business you can automate to save time? We’re not talking robots to offer your services, but administrative tasks that can be automated without sacrificing any part of your customers’ experience. Xendoo’s…. (not sure what services Xendoo offers in this area?)

Don’t delay when it comes to making your business more efficient…the clock is ticking!

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.

 

4 Ways for Retailers to Stay Out of the Cash Flow Black Hole

A potential pitfall for any retailer is the time gap between paying the manufacturer for the merchandise you sell and getting paid for it by the customers you sell it to. When that interval lasts too long, cash on hand becomes all too scarce. Here are four smart strategies for staying out of the hole.

Streamline your inventory.

If you have merchandise that sits on the shelf for more than 30 days, you have too much inventory. That means too much of your money is tied up on those shelves. A couple of streamlining tips:

  • Track your sell-through for each SKU, so you know which ones need to be reordered more quickly and which should be discontinued.
  • Don’t be tempted by bulk discount offers from your suppliers unless you have proof positive that those items will sell quickly.

Increase customer spending.

When your revenue per customer goes up, so does your available cash. There are many ways to encourage customers to buy more than they originally planned, including:

  • PWPs and BOGOs. “Buy this camera and get 20% off a camera bag” or “Buy 1 pair of sneakers, get another pair at 50% off.”
  • Upsell and cross-sell suggestions. “This TV has even better resolution than the one you’re looking at” or “Would you like the conditioner to go with the shampoo?”
  • Coupons for the next purchase. Include one in the shopping bag or mail/email it to customers who haven’t been in the store for a while.
  • Loyalty rewards for repeat customers. Accumulate shopping points to earn a discount.

Strategize your payables.

Shorten that gap between money going out and money coming in by waiting as long as possible to pay your supplier: 60 days, 90 days, or whatever it says in your contract.

Take advantage of early payment discounts. If you don’t know whether your supplier offers them, ask.

Consider an inventory loan.

If you’re short on cash but need to restock inventory, an inventory loan may be easier to get than a standard bank loan. That’s because lenders will look at your sales history, not just your credit score.

Paper profits may look nice, but good cash flow is the real indicator of a successful business. Being able to maintain it will improve your credibility … and your ability to take your business wherever you want it to go.

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.

 

Tonight’s Special Is: Sales Tax A How-To Guide for Restaurant Owners

Before we get started, keep in mind that sales tax laws vary by state and municipality. While this guide serves as a general rule of thumb, be sure to check on the specific laws governing your area before making any changes to your restaurant’s operations or accounting.

Restaurant owners face many complicated rules and regulations when it comes to running their business, and sales tax is no exception. This simple guide is designed to help you understand how sales tax works and what you need to do to be prepared and stay compliant.

What is a sales tax?

Sales tax is a consumption tax imposed by Uncle Sam on the sale of goods and services. In other words, it’s a fee the government requires you to pay in order to sell your delicious food.

Sales tax is paid by your customers to you so that you can, in turn, pay this amount to the government every month or quarter. Unlike a federal tax, sales tax is a sort of “pass-through” from your customers to the government.

Does my restaurant have to pay sales tax?

You’re required to pay sales tax if your restaurant has what is known as a “nexus” in a given jurisdiction. So if your restaurant has a physical presence, like a brick-and-mortar location or a food truck, you will definitely be required to pay. If you have a food business that is strictly online, you may not have to but should double-check with your local jurisdiction. Having an employee, an affiliate, or some other type of presence may make you liable to pay.

So when do I pay sales tax exactly?

Think of it this way: your customer is the end-user of the food you sell – after it hits their stomach, it isn’t going anywhere else (sort of). But before it got there, you purchased ingredients from suppliers. The tax was not due at that time, because that was not the end of the food’s journey.

It may seem for a moment like you’re getting a break, but there’s no such thing as a free lunch. You don’t pay taxes on the purchase of food supplies because you will be collecting taxes on the final product. It is your responsibility to correctly calculate the amount of sales tax due by your customers (more on that later) – you’ll be required to pay it whether you remembered to collect it at the time of sale or not.

So it sounds like I’m probably required to pay sales tax…how do I do that?

  1. If you haven’t done so yet, you’ll want to file for a sales tax permit with your local agency. A quick search online should help you find those forms.
  2. Determine your sales tax rate – they vary by state and municipality.
  3. Distinguish between taxable and non-table items in your restaurant – certain carryout items may not be taxable. Be sure to check on the particular laws of your area.
  4. Set up sales tax in your POS – charging customers correctly means you won’t be liable for sales tax payments out of your own pocket

I’m already charging customers sales tax and have collected the funds. What do I do with them?

First, make sure you’ve collected the correct amount of sales tax – because if you don’t, the government sure will!

Tally up the sum total of all taxable items sold in your restaurant during the month.

Multiply that number by your sales tax rate.

For example, your tax rate is 5% and you sold $1,000 in total taxable meals and beverages, the sales taxes due that month is $50. 

The final step is to complete the sales tax forms for your state, due monthly, or quarterly at a minimum. Xendoo’s sales tax experts prepare and file your sales tax accurately and on time so you don’t have to (you probably have a lot on your plate as it is). They also give you plenty of advance notice to ensure you have the funds available for payment.

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.