Annual Taxation Criteria

A simplified view of planning

As we all know, annual tax payments are always a very important milestone for any business. In recent years, the reforms applied, which are still in the process of adjustment, have resulted in a sort of “esoteric world” to the tax system, since what you knew six months ago has been altered again today, modifying the criteria for annual taxation.

The annual taxation criteria have changed. It is informally said that the “obligated” partner of any company is “don fisco” and as any partner he has to abide by strict rules and at the same time demands precise rules that must be complied with without hesitation.

The deadlines for the application of all franchises granted by law are also rigorous, so having access to up-to-date accounting equipment is more vital than ever. In any given month of the year we should know that we are already projecting the tax figure for the following year.

This seems so obvious but it is so simple to see that few companies do this planning that when the time comes to pay the annual tax they usually find themselves with big surprises of payments that could have been smoothed with the application in form and substance of those franchises granted by law, thus fully complying with the requirements of “don fisco” and improving the exposure of their own cash flow.

Tax Planning and the Annual Taxation Criteria

Tax planning is as important as commercial, logistical or financial planning for optimal resource efficiency. There are management control procedures that seek to standardize the way accounting is viewed so that it faithfully reflects the results; this is particularly important for the gross margins of each service or product.

The proper management of provisions to avoid mismatches resulting from purchases of inputs and sales of the same processed products, for example, requires a very fine control so as not to have months with low margins and other very high ones, if this happens in our country in December the effect on profits can be greatly affected.

That said, the "picture we came out with" on December 31 will be with us all year long, and it depends on prior planning whether it will be an "attractive profile" to the market.

The formal presentation of the income tax is together with the tax folder that shows the official monthly records, the documents that accompany the company as its “annual banner”, its “official ranking” with which financial entities evaluate positively or negatively the business to grant credits or not. All other documents that may be used as support are complementary, business plans, pre-balance sheets, various explanations are submitted second to the annual and monthly income forms. Hence its importance.

If you want to know more about our consulting services, I invite you to visit them by clicking here:

More about Operation Renta 2021