The income of enterprises in Israel has a rather high tax burden. But at the same time, there are many ways to reduce tax payments by correctly accounting for the costs of doing business. Let’s look at this issue using the example of cost accounting that occurs during working trips around the country or abroad.
Perhaps there is not a single company that would not require the occasional business trip of business owners or employees of the company to go on business trips, but not everyone knows that travel expenses can be taken into account in order to optimize taxation.
At the stage of preparing the trip, provide documentation that confirms that the planned trip is indeed for business. Such documentation may be:
Following the trip, participants draw up a detailed report. The report describes that he who is such and such (full name, position), was on such and such a business trip, with such and such as the goal, for so many days. All cheques and expenses, evidence of the implementation of business activities on a business trip are filed with this report. It should be remembered that not all of the costs of a trip can be covered as direct expenses on a business trip.
Or, without writing down the cost items in detail, an enterprise can carry $125 per day, per person for travel expenses.
Moreover, in the framework of a business trip, there may be accompanying cost items that can also be taken into account in the framework of tax optimization:
When taking into account the costs of doing business and optimizing the tax burden, it must be remembered that the Israeli tax authorities very harshly punish enterprises if they suspect actions related to illegal tax evasion.
In order to most effectively use fiscal legislation for tax optimization, it is better to contact a professional. An experienced specialist, not only familiar with the Law, but also constantly monitors updates and amendments, and knows how to properly organize work with fiscal organizations and prevent accusations of tax fraud against the company.
So, we have outlined the possibility of accounting for expenses that arise in the framework of trips abroad, in order to reduce the fiscal burden. You can get acquainted with other examples of tax optimization from the practice of the audit company “Shmuel Brodecki Roe Hashbon” in our blog, in the article «Hiding taxes is more expensive than paying them!». We invite you to ask questions directly about your business as part of a free consultation.
This article is for general informational purposes only and does not replace expert advice.
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