Hopefully at this point in the year you’ve already had a conversation with your
accountant regarding year-end tax planning for the 2021. Tax planning is an
important tool that should be used to put your business in a good financial position
for the current and upcoming year.
So, what does tax planning look like for a pharmacy?
There are many things to think about when it comes to tax planning. Some common
year-end tax planning considerations include:
- Looking at changing your business’s taxable entity type depending on the financial position your business finds itself in.
- Considering a large, fixed asset purchase of pharmacy automation equipment, a delivery vehicle, etc. if there is excess cash in the business. This will allow the business to make good use of the business’s profits and take advantage of a current year deduction for the purchase.
- Looking at changing your business’s overall accounting method from accrual to cash to take advantage of certain write-offs for tax purposes.
- Reviewing the prior year’s tax return to take into account any loss carryforwards that the business or you personally may have.
It’s important to take some time to talk to your accountant about these things,
weigh the options, and come up with a plan that makes sense for your business. We
have tax planning discussions with our clients to make sure they are in a good
position at year-end. If you would like to have a discussion with us, feel free to give
us a call or email us and we would be happy to have a free consultation to look over
your books and tax returns with you.
Read more about our accounting and taxation services.
