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What is Business Tax Relief?

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  • Written By: Mary McMahon
  • Edited By: O. Wallace
  • Last Modified Date: 25 July 2017
  • Copyright Protected:
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Business tax relief is a form of tax relief which is intended to reduce the tax burden on businesses. There are a number of forms of business tax relief available. Such relief is used to help businesses avoid bankruptcy, to keep businesses going when they might otherwise fail, and to stimulate economic growth by promoting a healthy business climate. Many nations are especially concerned with small businesses, providing them with a number of relief options to help them succeed.

When a national economy appears to be faltering, business tax relief may be passed in the form of legislation which actually changes the tax code. This benefits all businesses across the country, and can provide a form of immediate tax relief. The law usually reduces the tax burden on businesses, and may provide more lenience when it comes to nonpayment of taxes. Once the economy has stabilized, the tax code may be changed again to toughen up the laws which pertain to taxes.

Tax relief is also provided to businesses which can demonstrate hardship. For example, in many nations, if a disaster area is declared and the administrator of an area asks for assistance from the national government, businesses in that area may be automatically entitled to tax relief, as a recognition of the fact that they probably experienced hardships as a result of the disaster. This tax relief can range from a reduction in tax rates to tax credits to more leniency with claimed deductions.

If an individual business is struggling to pay taxes, it can apply for business tax relief. This may include the establishment of a payment plan which allows a business to make up back taxes or pay an existing tax bill over time, or it may include debt forgiveness, if a business can show that it has no realistic way of paying the taxes. It helps to have a tax attorney or skilled accountant to negotiate with tax agencies for this type of business tax relief, and to read the terms of the relief agreement very carefully to confirm that it is clear.

If a business owner suspects that he or she may have difficulty paying taxes, or realizes that he or she is getting behind on taxes, a tax attorney or accountant should be retained immediately. A tax professional can help negotiate tax relief, find tax loopholes to reduce the burden of taxation, and work to prevent shortfalls in the future. The earlier a business asks for help, the more likely the government is to consider offering business tax relief.

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