The ghost kitchens get taxed on multiple fronts due to which ghost kitchen owners need to be prepared before the final date arrives.
We’ve prepared the ghost kitchen tax preparation tips that will help you while you’re filing tax returns.
There are ghost kitchens that are paying tens of thousands of dollars per year because they’re located in a high-demand area and they have a number of employees working.
However, if you have a small ghost kitchen, you won’t have to pay that much amount of money in the form of tax.
But you’d still have to go through the detailed paperwork before filing your tax return.
Important information about Ghost Kitchen Tax Preparation
Here is some basic information every ghost kitchen owner must understand before they start the ghost kitchen tax preparation.
Federal Income Tax
Federal Income Tax is imposed on all the business owners. You need to pay the federal income tax on your personal income and business income.
However, you can deduct personal and business expenses. There are several other options you can deduct from the tax.
You’re also responsible for paying taxes on your employee’s wages. The tax can be anywhere between 2.9-12%.
Health Taxes usually don’t apply to the ghost kitchens because ghost kitchens don’t have a dine-in area.
However, the health tax is the additional amount you pay on items that aren’t good for human health.
The purpose of this tax is to discourage people from using unhealthy products and it’s only implemented in a few countries.
If you’re selling beverages at your ghost kitchen, you’d have to pay this tax for items that are included in the list.
Tax Deductions to keep in mind
During Ghost Kitchen Tax Preparation, you must have a clear idea of expenses you can deduct from the taxes. Let’s take a look at these elements.
It’s really difficult to grow the ghost kitchen if you aren’t spending enough money on marketing.
How can you expect people to reach out to you when they aren’t even aware of your presence in the industry?
The best part is that you can deduct the expenses of your marketing efforts from the tax.
You must keep a record of everything you spend on the marketing efforts otherwise, you won’t be able to get this opportunity.
The staffing costs also reduce the profit of ghost kitchens to an extent. And the authorities understand this fact pretty well.
Therefore, they don’t charge any tax on the amount you pay to the staff members.
The ghost kitchen owners can deduct the salaries of their staff members from their kitchen’s income tax.
The ghost kitchen equipment is very expensive and you don’t have enough amount to pay the taxes when you’ve purchased the new equipment.
In this situation, the local authorities give you the freedom to deduct those items from your overall income tax.
So, don’t forget to include these items in your tax deductible list when you’re working on Ghost Kitchen Tax Preparation.