A business can operate in several different legal arrangements including:

• Sole proprietorship - this is one person owning the business. Downside is that the owner is personally liable for all debts and liabilities of the business. The taxable income (net profit) is included in the owner’s personal tax return. The owner can deduct all legitimate business expenses on his personal tax return.

• Partnership - two or more people form a business and share the profits in an agreed upon split. The taxable income (net profit) is reported on the partner’s personal tax returns. Again the partners individually and collectively are responsible for the debts and liabilities of the business.

• A corporation is a legal entity formed by one or more persons under the laws of a specific state or federal statute. Legally it has a separate legal existence from that of its shareholders (owners). Thus, and very importantly, the shareholders are not legally liable for the debts or liabilities including law suits of the corporation with some exceptions. This is a huge advantage to protect the personal assets of a business owner. There are two main forms of corporations:

- C Corporations - shares are held by the shareholders and may be publicly traded. It is taxed separately from its owners under subchapter C of the Internal Revenue Code. In other words, the corporation itself pays income taxes (both federal and state) on the taxable income (net profit) of the corporation. In some situations the income from a C Corporation is subject to double taxation and is not typically the legal form that a small business should utilize.

- S Corporations - shares are held by the shareholders and but can’t be publicly traded. An S Corporation is a corporate entity that has elected to be taxed under the provisions of Subchapter S of the Internal Revenue Code. A corporation when formed by default is considered a C Corporation-thus an application must be made and be approved by the IRS to be a S Corporation. The taxable income (net profit) is passed on to the shareholders who report the taxable income on their personal tax returns. These personal tax rates are typically lower than the corporate rates paid by a C corporation. In California for a S Corporation, there is a minimum annual corporate income tax of $800 paid to the Franchise Tax Board.

Determining the most advantageous legal structure is based on a number of factors including:

• number of shareholders

• annual profits

• exit strategies i.e. plan on how to exit the business

• estate planning

• and other factors

Getting it right from the start of a business is vitally important to minimize taxes and personal legal liabilities.

John Spurgeon is a tax attorney in Pasadena, California servicing clients in the greater Los Angeles area. John Spurgeon & Associates, who are both tax attorneys and CPAs, offer a complimentary initial consultation. Please call 626-440-9518.

About John Spurgeon & Associates

John Spurgeon & Associates is a professional services firm located in Pasadena, California with a focus on tax law and related accounting services. They have extensive experience with federal and state income taxes, payroll taxes and sales taxes. They represent business, non-profits and individuals against the IRS and the Franchise Tax Board (California State Taxes). As both tax attorneys and Certified Public Accountants they offer a broad range of tax related services.

To overcome the increasing rate of pollution, government of United Kingdom has taken a vital step against the emission of carbon dioxide (CO2) into the atmosphere by the vehicles. The government has enforced new Co2 based UK car tax rates according to which the owner whose vehicle emits more Co2 is liable to pay more car tax. To avoid paying more car tax rates one should opt for the greener vehicles and should do tax planning solicitously all through the year.

So if you are planning to buy a new cost-effective car then it is recommended that you use car emissions calculator available online to compare the various models of cars on the basis of car tax. Car tax calculator gives an indication of the car tax charges that you would be likely to pay. In order to calculate car tax you require simple details relevant to fuel type, transmission details like manual, automatic or both, manufacturer, car model and specific Euro standard. Once these details are fed into the car tax calculator it would generate the applicable car tax rates payable for chosen timeframe.

The main idea behind the road car tax is to reduce the use of the vehicles that cause high rate of pollution. Car tax calculator UK is designed to promote the use of fuel efficient greener cars that produces less CO2. Based on the amount of CO2 produced, car tax rates can be judged in a series of payment bands. There are seven car road tax bands starting from A to G. Cars emitting up to 100g/km gas falls in band A whereas those between 101-120km/km in band B, from 121-150g/km in band C and so on. If your car falls in band A or band B then you are excused from increased car tax.

But if your car is not environment friendly and emits a lot of CO2 gas, then it’s definitely going to burst your financial budgets. The use of fuel efficient greener cars is extremely easy on the pocket as well as the environment. The Environmental Protection Agency (EPA) estimates that fossil-fuel vehicles emit 1 ½ billion tons of greenhouse gases into the environment each year and changing to green transportation would reduce this a lot. It is also estimated that eco-friendly car owners are currently saving £165.40 per year on fuel compared to those driving standard cars. So before purchasing any vehicle first calculate car tax and then go for the deal.

For most people, taking a holiday may seem like the last thing on their mind at the moment. However, it may well be that is just what you, and the Australian economy needs.

A large number of working Australians have a significant amount of accumulated annual leave hours due to them. Whilst it feels like you should be working harder now that ever before, in times of slow economic activity taking some time off can actually be of benefit to a number of different areas of the community, namely employees, employers and the Australian economy.

It’s good for employees because…

A break from your day-to-day routine can help to revitalise you and lift your spirits. Some time away from hearing about how little work there is at the moment and constantly experiencing how mundane the workplace may have become can do wonders to rejuvenate and re-excite you about your job and your life.

Having people get out of the office and return refreshed and positive can also have a flow on effect to the rest of the staff and the mood can shift from one of regularity to that of motivation. This can also have a similar flow on effect in relation to your family life and relationships.

Most people commonly claim that they cannot take leave as they are simply too busy, however the effects of a few days off can often result in increased productivity and creativity.

It’s good for employers because…

As well as a better chance of being able to keep attending staff active as there are fewer employees on board for a temporary period, and the previously discussed emotional and motivational benefits, there are also financial benefits for employers having employees take some time off.

Employers are required to maintain provision in their accounts equivalent to the value of all employee’s accrued annual leave. By employees not taking that annual leave, employers are left with a large sum of money that they cannot touch for investment purposes or other business activities that may stimulate the business’ development and growth. This can result in a significant financial liability for the business.

It’s good for the Australian economy because…

The common message at the moment is not just to take time off and stay at home, but to travel to local Australian tourist destinations. Tourism is such a large part of our economy, from generating income for the country as well as employing hundreds of thousands of people.

So, in simplistic terms, taking some well-earned time off can help yourself, your employer and your country. Of course, it is important to remember that no-one can force or be forced to take leave against their wishes. Although, with a country as great as ours to explore no-one should really need their arm twisted too hard to take a few days off!

The team of lawyers and accountants at The Quinn Group can provide you with personalised advice in regards to leave entitlements and business tools to get through these slow times. So, if you are an employer or employee and would like more information contact us on 1300 QUINNS or click here to submit an online enquiry.

1. New windows

If you do not have them already, installing energy-efficient, or double=paned windows can be a great way to use your refund. Not only will installing these new windows keep the cold out and the heat in, but you can also claim federal tax deductions for qualifying installations, if installed before December 31st of 2009. You can deduct 10% of the cost, up to $200 for all windows, skylights, and storm windows.

2. Hybrid Vehicles

The arrival of new and updated hybrids in 2009 also brings with it a round of new green auto deductions. If you purchase one of the new plug-in electric vehicles, you will qualify for a new tax credit, between $2,500 and $7,500, based on the battery capacity. Get them quick though, as phase-outs begin after the first 250,000 vehicles are sold. Additional credits are also available to qualifying hybrid and biodiesel vehicles manufactured after 2006, depending on their battery capability, manufacture date, and hybrid ability.

3. Replace your Lights

Replacing one older bulb with a newer, more efficient one can save you up to $350 throughout the light of the bulb! Replacing all lights in your home (or office) with new, energy efficient bulbs is a great way to spend your refund because it will also save you money in the future. Additionally, if you are remodeling a building and purchase more efficient lighting for it, you may even qualify for a deduction or credit for doing so.

4. Green Mutual Funds

Much like other mutual funds, ‘green’ mutual funds take your money and invest it in to other companies, hopefully giving you a good return on investment over time. What makes ‘green’ mutual funds different is that they only invest your money in companies who actively benefit the environment with their products, have projects running that help the environment, or have clean and sustainable business modules.

5. Recharge and Save

More than 3 billion batteries are purchased, used, and thrown away by Americans every year. That is a lot of money, and a lot of trash. Purchasing batteries and appliances that are rechargeable is a great way to save money and do good for the environment at the same time.

6. Treat Your Kitchen

Purchasing new appliances for your home will help you save energy and money, as well as give your Kitchen a new look! You might be surprised at how much energy old microwaves, ovens, blenders, coffeepots, etc. waste compared to new efficient models. Remodeling your kitchen will all new appliances is a great ‘green’ way to invest your refund, while also increasing the value of your property.

7. New Heater or A/C

Updating to a new air conditioning and heating system will benefit you in many ways, including a nice tax benefit. As long as your new a/c and or heater was placed in to service between Jan. 1st 2009 and Dec. 31st, you can claim a credit of $300, or possibly even more depending on the system you used. Check the IRS website for a full list of credit qualifying products.

8. Alternative Energy Stocks

If you like to play the stock game, and you love the planet, then you may be interested in investing in alternative energy stocks. It can be confusing if you are a beginner, but as the trend spreads there will be more information available. For now, check out sites like AltenErgyStocks.com for more ideas and tips.

Development of a nation plays a major role in the progress of a person. The main attribute that is necessary for the development of the country is the finance. No country can grow without money. Government arranges finances from various sources. One of the major sources to get finances is from the payment of taxes from the people. Income Tax is a major liability imparted on the people. It is taken on the basis of annual income of the people and the amount of income tax return depends on the income of a person.

These returns can be classified under two categories i.e. individual and professional. One has to file an individual income tax return personally on the basis of the income he or she gets. On the other hand, in case of professional income tax return, the amount is deducted from the salary of persons.

In order to file return, one has to fill some forms with all the information regarding his or her salary. The amount can be paid by cash, cheque or demand draft. In the past, paying return was supposed to be a tedious task. But now government has made all the procedures easy.

In the present scenario, the return can be filed with ease with the help of the Internet. The website of the income tax department, launched by the government of India, has the facility to file the return online. The e-payment options of the website allow the tax payers to pay the amount through their credit cards. They can pay it with ease while sitting in front of their computers. The online procedure requires filling of online form with all the details. After that, you are required to enter the credit card number and a special code which is written behind the card. Your income tax return will be paid just by going through this procedure. This method is really too easy that anyone who is familiar with the Internet can conduct the procedure of paying the taxes with ease.

You can read the terms and conditions of the return on the above said website. These terms and condition help you in getting the information about the rules and procedure of paying tax with ease. Moreover, you can also download the form from the website to pay the tax offline. There are some other Internet portals available which provide many facilities related to the tax return. For instance, you can calculate your tax amount easily on these sites. You can calculate all the amount within a minute by entering your income details.

Above analysis shows that filing the income tax return has become an easy task which can be performed while sitting at home. It can be performed by simple Internet surfing. The procedure of paying the return has also become so simple that it is no more a dilemma for the people. In a way, we can say that paying return is a way to contribution in the development of our nation. Hopefully, in the coming time, the procedure will be even more simpler than today and we shall be able to file the return with more ease.

Productivity and sales may be slow at the moment but that does not necessarily mean that you should hit the breaks on everything in relation to your business. The fact that things are a little slow from a day-to-day workload perspective means that you have more time to step back and take stock of all those things you always mean to do, but never seem to get to.

Taking the time to review and make changes to the way your business functions could prove to be beneficial both now and more importantly in the long term, as the economy picks up again.

There are numerous facets of the business that can be addressed from financial considerations to trading terms and operations/procedures. Following are some helpful questions you may like to consider to prepare your business for the tough year ahead and put it in an optimal position for when the tides turn and business is on the up!

Ask yourself the following questions. Once you have ascertained the specific areas of your business that require attention, ensure that you speak to the relevant professional in order to get the best advice on how to improve your current situation.

Banking

* Do you have a positive working relationship with your banking manager?
* Do you regularly touch base with them to provide updates on the financial status of your business and to seek any necessary advice?
* Do you have strategies in place in the unfortunate event that something should go wrong with the business financially?
* Are your business assets correctly valued in order to support any business loans that you may have?

Accounting

* Do you have a positive working relationship with your accountant?
* Is your business structured in such a way that your personal assets are protected?
* Do you have private assets held separately from the assets of your business?
* Are business owned assets held in the correct way, under the correct structure for your situation? For example, sole trader vs. partnership vs. company vs. trusts.

Operations and Trading Terms

* Are your contracts with customers and/or suppliers correctly structured and legally compliant?
* If you are supplying materials in the course of your business, does your contract allow for the retrieval of unpaid goods?
* Do your current contracts and trading terms processes include provisions to facilitate the prompt recovery of debt owed to you?
* Are there areas of your business that could be cut down or made more cost effective but will not affect the operations and daily functioning of the business?

Protecting your business

* Do you have a compliant and up-to-date shareholder’s agreement?
* Do you have clearly defined corporate governance practices in place?
* Does your current insurance policy adequately cover your business structure and assets?
* Is any intellectual property sufficiently protected and/or legally registered? For example business names and logos, personally developed products, methods or innovations.
* Do you require confidentiality, non-disclosure or restraint of trade agreements with suppliers or current or previous employees?

Protecting you, the owner

* Do you have an up-to-date and valid Will?
* Do you require an enduring power of attorney?

Of course these are just a few areas that you can look to in order to start strengthening your business. Other areas you may wish to consider include Marketing practices, Staffing and Human Resources and Management processes.

If the above checklist has highlighted some areas on your business that could do with a ‘touch up’ contact the team of accountants and lawyers at The Quinn Group. We are able to assist you with everything from drafting contracts and negotiating with financial institutions to reviewing or restructuring your business structure and providing cash flow and budgeting advice.

For more information, or to organise to speak with one of our team about your business needs call us on 1300 QUINNS or click here to submit an online enquiry.

It is generally known by employers that they must have appropriate levels of Workcover insurance for all of their ‘workers’. However, what is not so well understood is the definition of what constitutes a ‘worker’ for Workcover purposes.

This definition does not appear so clear particularly when it comes to businesses that are employing contractors. For most business dealings and arrangements the hiring of contractors is generally considered as a different employment arrangement than that of standard employee - employer agreements.

In recent times contracting and the employment of contractors, as opposed to employees, has become a lot more common practice across a range of industries of the business community. As a result of the current economic climate businesses are employing more and more contractors as it can prove to be a more cost effective exercise.

Where employers can find themselves in trouble is when it comes to gaining Workcover insurance for all of their ‘workers’. Under Section 11 (1) of the Workers Compensation and Rehabilitation Act 2003 a ‘worker’ is defined as ‘…a person who works under a contract of service.’

Whilst the Act does go on to specify who is and is not considered to be a ‘worker’ in particular circumstances it can generally be said that contractors who are providing a service to their employer are considered to be ‘workers’ for Workcover purposes.

Furthermore, Section 48 (1) of the Act outlines every ‘worker’ must be insured.

Every employer must, for each worker employed by the employer, insure and remain insured, that is, be covered to the extent of accident insurance, against injury sustained by the worker for-

(a) the employer’s legal liability for compensation; and

(b) the employer’s legal liability for damages.

As a result, it is important that if your business employs contractors or if you are employed as a contractor yourself, then you should seek advice as to whether you have the necessary Workcover for your situation.

In the unfortunate circumstance that an employee or contractor is injured and the employer does not have the correct level of Workcover insurance this can cause a lot of unnecessary financial and administrative burden for both parties.

Each employment situation is different and the requirements for Workcover insurance of ‘workers’ may be different for various businesses and business arrangements.

If you are unsure as to what your Workcover insurance obligations are the lawyers at The Quinn Group can certainly advise you on what is legally required for you to have appropriate insurance for your ‘workers’. We can also assist you if your business has insufficient insurance and has found to be liable for an accident that involved one of your workers. For more information contact The Quinn Group on 1300 QUINNS or click here to submit an online enquiry.

Personal income tax is a kind of tax system that is imposed on the personal earnings of an individual. A person pays his/her income tax on the basis of his annual payment he/she used to get as the salary or wage. In a general sense, an income tax is a tax imposed on the financial income of an individual, people or other legal entities. A personal or individual income tax is levied on gross annual income of the individual with some permitted deductions. Personal income tax usually collected on the end of every year with small or no amendments in tax structure.

Most income of an individual in UK is subject to income tax deduction under the PAYE scheme that’s an expedient personal income tax collection process for the Government. If you have interest received, your tax is usually deducted by the payer. PAYE method of tax payment allows your tax payments to be made automatically from your salary package if you are in job sector, thus dropping the hassle of excessive individual involvement in taxation process. However, in a case if you are self employed you need to fill out a self-assessment tax return at the end of each taxation period.

In case if your tax is overpaid you may get the benefits of huge tax rebates however you may also opt for other allowances which you may be entitled for, to save a considerable amount of money in income tax payments. Income taxes are paid by persons of UK on the basis of the annual income. Taxes money is spent in the development of the country in each and every field. Hence every person like as business man or employee pays their taxes to the government.

In UK, taxable personal income of an individual is not the same as his/her total income lies since all the taxpayers are permitted to enjoy a definite amount of tax-free income sometimes called a personal allowance and some are entitled to various additional allowances as well. The amount of personal income tax levied on an individual depends upon your earnings and your monetary status as well as the type of income he or she is receiving.

On the completion of your Personal Income Tax period, State income tax Office contacts your employer to arrange that you need to pay. In some cases tax could be deducted directly from your earned income after the completion of taxation period.

No one wants to consider the possibility of their own demise, the inevitability of life. The hard truth is everyone dies and just about everyone leaves loved ones behind. Even if you have no significant estate to leave to your family you should consider the use of a financial ad visor and a solicitor to draw up a will. A will is not only something that sees the division of what worldly possessions you leave. Wills serve a number of purposes. They determine how you want your remains taken care off. They list all your final wishes.

More importantly is the fact that if you die without a will your estate falls under the intestacy laws. This means that the courts decide the division of the estate despite what your wishes may be. The laws which govern wills and intestacy are fairly strict when it comes to the percentages and who gets what and in what order. The Laws of Intestacy do not cover if you were estranged from certain family members for instance. This is why it is important to have wills and intestacy handled by professionals.

Another thing to consider is the fact that wills should not be in any way done on your own. It is important to have a solicitor handle the creation of your will in order to ensure that everything is laid out properly and within the law. Otherwise you may end up with a will that is meaningless and an estate that falls under Intestacy.

The law of Intestacy replaced the rules of succession and are involved in forced heirship rights. Usually this is the legal next of kin if there is no designed or no legal next of kin in these cases the estate with escheat to the government. In other words, the government could claim the rights to the entire estate. In order to prevent this from happening and to make sure that your will is not contested between your heirs you need to have wills and intestacy documents drawn up and these issues covered so that you can have the peace of mind to know that your estate will be divided according to your wishes and that your final wishes are carried out in an appropriate manner.

There are also matters of inheritance tax to consider when placing a will together this is why it is important to have someone with knowledge of the regulations and legislation handle the paper work. Some people may want to save money by doing it themselves but unless you have intimate knowledge of legal procedures it is best if you avoid doing this especially with estates of any significant value.

Handling wills and intestacy are not just for when you are gone from the world. You may also find that you need assistance in carrying out your wishes when it comes to serious illness. If you fall prey to a serious illness which prevents you from being able to handle your own affairs and make decisions on your own who will look after you? Who will handle your estate and ensure that you and your family are taken care of? This is what a will can do even if you have not passed away.

A will can also determine who is responsible for the distribution of the estate and any trusts that you may have. While it is common to have separate trust fun agreements it is not uncommon for these agreements to be included in the will. This is why you should have a financial advisor who is familiar with the handling of taxes and distributions of funds to help you to set up the financial aspects of your will. Once you have done this it is easy to obtain the services of a solicitor that can provide you with the legal documentation necessary to back up your wishes.

Having a will and dealing with your final affairs is life house keeping. You would not leave your house a mess and you should not leave your financial affairs and the future of your estate a mess either. Take the time to consider every aspect of your estate when these assets can be released from your estate as well as who will handle affairs if you become unable to handle them yourself or for after you pass away. Also make sure to have a solicitor review, revise or write up your will in order to ensure that it is clear and concise.

Filing income tax returns is a nearly universal experience for Americans. The approach to this often stressful event varies from person to person. Some self-reliant people jump right in, using government provided forms, scratch paper and a calculator to complete their taxes by hand. Other people, who have the same self-reliance, but who find a little help to be comforting, use a tax software program to calculate their taxes. Others prefer to pass this task on to others, hiring an accountant or tax consultant to do their taxes for them. Which ever way you choose to do your taxes, it is important that you are aware of the many tax deductions you can legally take. Knowledge of these can save you hundreds of dollars.

Taxpayers are very aggressive about claiming exemptions on their returns, which totaled $842 billion in 2005 according to the IRS. That said, many taxpayers don’t claim all the exemptions to which they are legally entitled.

Become Educated

Guidelines based on what you earn allow you to claim the costs associated with pursuing an education as a tax credit. For instance, the Lifetime Learning and Hope credits permit you to get a credit for your tuition expenses. Becoming informed is always a smart move.

According to a government report written in 2005, which surveyed and included information from almost 1.5 million citizen’s tax returns, of the people who were entitled to the Hope or Lifetime Learning grant, as many as 1 in 4 people did not take advantage of it. This works out to an average of $160 per person, but in some cases it was as high as $500 in surplus taxes!

You can receive help in paying part of your college tuition through the Hope credit. You can get as much as $1,650 for tuition, or costs related to tuition, depending on your income (housing, supplies, or books are not included). If you attended an approved college, the Lifetime Learning credit allows as much as $2,000 toward education-related expenses. Since, for both programs, your income is taken into consideration, you may not be eligible if your income level is too high. However, both programs allow generous allowances and are based on your modified gross adjusted income. For taxpayers filing singly, that means making less than $47,000 a year. For those filing as married-filing-jointly, the amount increases to those making less than $94000 a year. For those taxpayers making more than $47,000 (single) or $94,000 (married-filing-jointly), you may be still eligible for a reduced amount. If you earn more than $57,000 MABI (or double that amount for those filing jointly), you are not eligible for either credit

To get full benefits from the deductions for tuition and education related costs, some of which could be valued at as much as $4,000, you are not required to itemize. Your MAGI, if you are not married, is $65,000 or less (if you are married and filing jointly, you MAGI is $130,000). You can gain as much as $2,000 in deductions if your single-person income is between $65,000 and not higher than $80,000 ($130,000 and $160,000 is you are a couple). If your yearly earnings are in excess of these numbers, you will not be able to claim a college tax deduction.

Determining the best credits and deductions you may take can be confusing. For example, you cannot use both the credit and deduction for tuition payments. You need to take some time to determine which one will be the most beneficial. In general, credits are usually worth more than deductions. There are other limits, such as phase-outs, that may also effect the amount of the credit or deduction you can use.