Why You Shouldn’t Wait Until December to Plan Your Taxes

From the Desk of an Accountant Who’s Seen the Difference Early Tax Planning Makes for Business Owners

Every December, I see the same scene:
Business owners scrambling through drawers for receipts.
Frantically asking for summaries from their staff.
Trying to make sense of reports while juggling year-end sales and holiday plans.
And the worst part? Realizing too late that they could’ve done something months ago to lower their tax due.

As an accountant who works with Filipino entrepreneurs across different industries, I can confidently say this:

👉 If you wait until December to plan your taxes, you're already too late.

❌ What Happens When You Wait Too Long

Whether you're a freelancer, retailer, or corporation, delaying your tax planning has real consequences:

• Missed opportunities for legal deductions
  (Yes, there’s a proper time to recognize expenses—and December is often too late.)

• Overpaid taxes
  You could have restructured your income, adjusted your operations, or timed purchases to reduce tax impact.

• Year-end panic and poor decisions
  Rushing invites errors, missed filings, and unnecessary stress.

• Cash flow crisis in Q1
  Because no plan was made, you’re hit with a large tax bill just as the new year begins.
  
  

🧠 Early Tax Planning = Strategic Business Decisions

What if you approached tax planning the same way you approach sales planning or budgeting?

I’ve helped clients:

• Adjust their payment terms to match tax seasons

• Time equipment purchases or expenses for better deductibility

• Shift to optional 8% income tax (when applicable) early in the yea

• Maximize input VAT claims by checking books regularly

• Separate personal expenses from business early on to avoid disallowed deductions
  
  

These are strategic moves—not just compliance chores.

✅ What You Can Do NOW Instead of Waiting

We’re not in December yet—and that’s a good thing. Here’s how you can start today:

1. Review Year-to-Date Financials

Ask your bookkeeper or accountant to give you your income, expenses, and taxes paid so far.
🔍 Are you earning more than expected? Are there expenses missing?

2. Clean Up Your Records

Now is the time to:

• Match books with bank statements

• Collect missing official receipts

• Organize BIR-required documentation (especially if you’re VAT-registered)
  
  

3. Forecast Your Full-Year Income

If you expect to close more deals or generate more sales in Q4, estimate it now.
This helps you prepare for your annual income tax and make adjustments if needed.

4. Consult Your Accountant While There’s Time

In the lean season, I have more time to go deep with my clients—to help them:

• Check for underreported income or overstatements

• Review BIR compliance risks

• Prepare financial statements in advance for loans, investors, or audits
  
  

5. Decide on 8% or Graduated Taxation (if applicable)

If you’re a sole proprietor or professional, tax planning involves deciding whether to stick with the 8% flat income tax or the graduated table. It pays to evaluate this before the year ends—not after.

💬 Real Talk: December Is for Execution, Not Planning

I always tell my clients:
“By December, you should already know your numbers, your expected tax dues, and your next moves.”

December is when we finalize, not figure things out.
The real tax savings happen in June, July, August, when we can still steer the business—not when we’re racing to beat deadlines.

🧾 Let’s Make This Year Different

Tax planning doesn’t need to be stressful.
When done early, it’s empowering.
When done consistently, it’s profitable.
And when done with the right accountant, it’s peace of mind.

Don’t wait for year-end regrets. Let’s talk about your numbers now—so you can spend December focusing on growth and gratitude, not stress and spreadsheets.

Because the best tax savings aren’t found in December—they’re made way before it.