Top Financial Challenges for Business Owners

These are the five critical challenges I have encountered most of the time after working extensively with business owners over the last 30 years. They may represent opportunities if properly addressed in a timely manner; otherwise, they may be detrimental.

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What strategies can help keep my taxes as low as the law permits?

Business Entity: effective tax management starts with the company's chosen business structure. In some instances, for example, the Sub Chapter S Corporation could allow operating losses to be passed on to owners, thereby providing personal tax benefits.In other situations, a regular "C" corporation may protect owners from passing through income that would otherwise have an adverse effect on their personal taxes. The LLC can offer the advantages of each. It is important to review the structure periodically in the light of current and expected business performance in the foreseeable future.

Tax Advantaged Benefits: In addition, there are a wide range of options that can benefit both the owner and the selected staff on a tax-advantaged basis. These may include health & welfare trusts, individual pension schemes, retirement compensation arrangements, holding companies, charitable donations and estate freezes. How beneficial these can be requires careful consideration of the individual situation.

Effective tax management requires continuous effort. Strategies need to be adjusted as the objectives of the owner and the financial situation change.