As a dentist, you serve a hugely important role that keeps the smiles of the country gleaming and great. However, like any other business, you need to pay taxes and this means getting ready to manage your business accordingly. What all dentist need to understand, then, is that filing taxes can be quite a bit more complex in this line of work that it can be for other firms.
The rules are quite strict and many dentists find themselves victim of trying to be a little too cool with their planning. Going over the top with expenses and deductions will almost certainly get you looked upon unfavorably by the government. So, when filing taxes, make sure that you are fair about the kind of deductions you want to put across.
While everything else for a dentist can be relatively straightforward, filing taxes can take a lot of work and planning simply because of your expenses. Start off by thinking about travel expenses. All of those trips around the place to pick up supplies, for example, are deductible. Travel expenses that take you to and from education and business events are deductible. Traveling to and from the office, though, are personal and therefore not something that you can look to get back – a difference from other business models.
Always be sure to keep clear records of mileage, times and travel distances and log it all. Even make rough notes in your smartphone and then log it all in a document at the end of the year. Another mistake is how you pay yourself. Many people try and put their entire pay-cheque through as a dividend to avoid the tax on paying an employee wage – this is not a good idea and is asking for a review of your business.
Dentistry can be a hard one to evaluate, and the excessiveness of some participants means that dentist tend to get looked into for assessments more than other businesses. We recommend that you take the time to invest in hiring a taxation professional to come in and take a closer look at how you operate.
A CPA for example can take a look at what should and should not be part of your expense/deductions, while also help you improve business operation in time. Don’t try and take on the taxation battle alone: for most dentists, the grey areas are simply too vast in number. Hire help and you can find that they can be the solution you need to get around the problems that you face.