Why should I file my taxes even if there is no profit

Accountant Kelisha Garvey, Business Registration
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Jamaica News, January 30, 2018 (Mckoy’s News) – File My Taxes

How many times have you heard individuals say, “I am not “making” any money, I don’t have to file any tax returns?

Let’s reason that situation out and see if that view remains at the end.

Imagine you have established a company. You have employed a number of staffs, placed in a total of five departments. You are expecting reports to tell you what’s happening in your company at the end of each year. However, your staff decides that the year was a slow year and not much business was done so, they don’t need to submit a report to you.

What would your outlook on your staff be?

Would you have felt better if a report was submitted to you showing what little income was made, and what the funds were used to do, even if there is no profit?

This is exactly what our responsibility to the government as business owners is.

File My Taxes: as business owners, self-employed individuals, the Government is expecting that we give an annual report of what our income and expenses are throughout the year (i.e. what we earn and how much it cost us to earn these monies) and by extension pay our taxes.

If no report is submitted to tell whether or not we made a profit from which to pay taxes then it will be expected that we pay any tax that is due.

The correct thing to do is to submit your financial statement regardless of the horrifying tales it may tell, accompanied by the appropriate tax return form.

This more often than not results in you paying little to no tax. In most cases, your fear of paying exorbitant high tax only becomes a reality when you try to dodge by not filing at all.

Word to the wise, the penalty for not filing is much higher than the tax you actually pay when you file.

Benefits of being tax compliant as a business owner:

  • Tax Compliance adds legitimacy to your business
    Increases your chance of receiving financial assistance through loans or grants
    Helps to position your business to climb the corporate ladder
    Saves the Business money by avoiding hefty fines and exorbitant penalties

Just to name a few.

When in doubt seek the facts, it’s always easier to share hearsays than accurate data.


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