Tax Benefits

A part-time business that is fun but is only marginally profitable can be worth your while. There many tax benefits of business ownership. Once you register your business you can begin to write off expenses on your tax returns that regular company employees cannot. You can deduct a portion of your mortgage or rent, your car, your gas, your clothes/cleaning, meals, supplies, equipment, software, etc. These right-offs can add up quickly and contribute to your overall income.

If you profited nothing in your first year, and you got to write off $20,000 in expenses, and you were in the 20% tax bracket, you would realize approximately a $4,000 tax savings. That is real money that would stay in your pocket for you to spend or save.

If you actually made a profit, that would be even better – even after paying taxes. And if you could totally replace the income of your day job, and become 100% self-employed that would be even better. The government of most countries favor people who start their own businesses.

The goal should be to build your business as quickly and as profitably as possible, so that you can have control of your life and your future.

Action Step: Register a business, and get an accountant or bookkeeper to make sure you get the most tax benefits possible.