On March 31, legal entities must submit to the SAT their annual declaration corresponding to the fiscal year 2020, and SMEs are not exempt.
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This story originally appeared on Alto Nivel
There is no period of time that will not pass. On March 31st, legal entities must submit their annual declaration for the 2020 fiscal year to the Tax Administration Service (SAT) , and Small and Medium-sized Enterprises ( SMEs ) are not exempt.
This moment also offers an opportunity to measure the results of SMEs, which includes determination of profits and the performance of areas related to the measurement of companies.
However, there are key points that should not be missed during this time of the year. Luis Velasco, Aspel’s accounting strategist, shares six key tips that taxpayers should take into account to ensure an effective determination of their tax results.
1. Have all tax receipts
The tax result must contain the effect of each of the vouchers issued by the SME and those sent by its suppliers, including operations carried out abroad.
It is important to take into account that, together with the Digital Tax Receipts by Internet (CFDI) and the payroll of each worker, the receipts corresponding to the payment of their contributions must be considered within the tax file, such as those obtained from the Mexican Insurance Institute. Social (IMSS) and Infonavit, among others; in addition, it is necessary to make sure that the labor contracts are in force.
2. Deduct fixed assets
These are tangible assets (furniture, machines, etc.) or intangible assets (patents, trademarks, etc.) that the SME acquires to obtain an income or that contribute to its activity. Tax legislation allows them to be deducted in a dosed manner over several years, until the total investment is covered. To know which assets still have a useful life, it is recommended that the company have a historical record that can be consulted in digital accounting systems.
3. Support the information for taxes paid in the exercise
It is essential to have all the work papers, the referenced payments of the tax authority and the bank payment vouchers of the ISR during the year that is declared; Likewise, it is necessary to have the information regarding the monthly payments of the Value Added Tax (VAT) made in the year.
4. Carry out an Accounting-Tax reconciliation
This process allows to determine and verify the fiscal result; that is, it is a series of calculations that are used to determine a single profit during a year on which taxes will be paid, or a loss. Although there are general guidelines, their calculation depends on the type of business or activity of the company.
5. Applicable tax losses
When the SME determines losses in previous fiscal years, they will be considered as an additional benefit in the following years, which generates advantages, since it can be reduced from future profits up to a certain time. It is important to keep the work papers so that, in the next fiscal closing, they can be applied in case there are outstanding balances.
6. Include financial information
The annual statement must attach some data from the financial statements, especially the income statement; the latter allows the tax result to be determined starting from the accounting one. With this information, the origin of eventual inconsistencies can be traced.
Aspel is a Mexican company that, over 35 years of experience, has managed to consolidate itself as a leader in the administrative software market. Its leadership is the result of the innovation behind its technological solutions.