Xero Survey Reveals Biggest Tax-Time Mistakes, Offers Financial Advice for Small Businesses

Xero Survey Reveals Biggest Tax-Time Mistakes, Offers Financial Advice for 
Small Businesses 
Outrageous Write-Offs, Overlooked Deductions and Out of Date
Financials Top Missteps for SMBs 
SAN FRANCISCO, CA -- (Marketwired) -- 03/18/14 --  Xero, the global
leader in online accounting software, today uncovered accounting
trends, recommendations and questionable tactics in its third annual
Tax Time survey. While tax season can bring angst to many small
business (SMB) owners, the increasing adoption of accounting
technology in the cloud is helping accounting professionals alleviate
tax mistakes, such as attempting outrageous tax write offs like bail,
face-lifts and personal robots. Notably, the survey found that more
than 50 percent of accounting professionals are now using cloud
technology to better serve their clients. 
The Xero survey, conducted by Zogby Analytics, polled 400 accountants
across the U.S.*, and found that the biggest mistake SMBs can make is
only talking to their accountant during tax time, with 65 percent of
accountants recommending more frequent collaboration throughout the
year. 
"Tax time is stressful for most of my clients. Keeping tabs on
existing rules and regulations is complicated enough, and new
legislation like the Affordable Care Act and changes in the tax code
further muddies the waters," said Tom Compere, Xero XPAC Member and
manager, RBZ Accounting. "In this time of ever-changing market
conditions, it is imperative that financial data is up-to-date,
easily accessible and comprehensive in order to be prepared for
anything." 
Some Top Tips from Xero's survey and additional findings include: 
Tip #1: Communicate with Your Accountant Year-Round
 Financial
management should be a year-round activity rather than limited to the
traditional tax season, according to more than half of the
accountants surveyed. The biggest mistake nearly one-third of SMBs
make is only communicating with their accountants during tax time: 44
percent of accounting professionals advise meeting once a month. 
Tip #2: Maintain Updated, Comprehensive Financials
 The vast majority
of accountants (75 percent) believe that a comprehensive, real-time
view of finances is essential for dispensing the best advice and
saving money. However, one in five accountants state that their
clients do not have real-time insight into their finances, and nearly
40 percent do not maintain up-to-date records. Cloud accounting tools
like Xero automate much of the data reconciliation and allow
customers (and their accountants) to receive an accurate read on
their company's finances anytime, anywhere. 
Tip #3: Don't Leave Money on the Table
 With tricky tax laws, it is
easy to leave money on the table. SMB accountants concur, placing the
blame on overlooked deductions, including depreciation (30 percent);
out-of-pocket expenses (29 percent); auto expenses (16 percent) and
office improvements (10 percent). Xero can reduce oversights by
enabling businesses to keep accurate records and enter receipts with
just a few simple clicks. 
Tip #4: Avoid Accounting Accidents that Lead to Audits
 Nearly 75
percent of accountants blame faulty deductions for audits. Thirty-six
percent cite excessive deductions as causing audits, with mixing
personal and business deductions as a close second (35 percent). The
third cause of deductions is misidentifying workforce members, with
14 percent. Xero's networking of accounting and ecosystem partners
like TaxAct enables small businesses to avoid costly deduction errors
by allowing Xero users to prepare, print and e-file their taxes
directly through Xero's platform.  
"By contributing more than 50 percent of America's GDP, SMBs are the
backbone of this country. Xero's goal is to give these companies the
tools and technology they need to make the best possible business
decisions quickly and easily, from any device, anywhere in the
world," said Peter Karpas, CEO, Xero U.S. "Given today's industry
needs, it's no surprise that more accountants and SMBs are using
cloud-based accounting solutions to better manage their finances.
We're thrilled to help make life a little bit easier for accounting
professionals and SMBs during this extremely busy time of their
year." 
Check out Xero's Tax Time infographic here:
http://www.xero.com/infographic/small-business-tax-advice  
About Xero
 Xero is beautiful, easy to use online accounting software
for small businesses and their advisors. The company has over 250,000
paying customers in more than 100 countries around the world.
Recently Xero garnered a "Top Choice" review for Online-Based
Business Accounting Apps from PC World. The Xero US team is
headquartered in San Francisco. Xero is hosted with Rackspace in
Chicago. 
*Zogby Methodology:
 Zogby Analytics was commissioned by Xero Limited
to conduct an online survey of 400 accountants in the US. All
interviews were completed between February 12 and February 15, 2014. 
Contact:
President, Xero US
Jamie Sutherland
(415) 806-1107
Jamie.Sutherland@xero.com  
Media Contact:
Bill Bode
Highwire PR
O: (415) 963-4174, ext. 49
Xero@HighwirePR.com 
 
 
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