The benefits of starting a home business or home based business are numerous, especially if it’s a side hustle.
Even if an individual quit a job to operate a business at home, and made the same gross income, they would be further ahead financially. Why? Because of the home office write offs.
If someone with a job starts a side hustle, the benefits are even more amazing. How so? Businesses take time to get started.
So what? Well, it takes effort to make money, which happens over a period of time. Not instantly.
Still don’t get it? Don’t worry, you will. Since, typically, there is little or no income initially but extra write offs for the home office. These are applied against the job income!
A reduction in taxable income means less tax is paid to the Government. And that means more money in one’s back account, even without any increase in income.
You see, expenses are not accrued, they are instead applied against any income, even a day job.
Put in English, you are ahead financially even before your home business makes any income — if you have other income apply the home office write offs (expenses) against.
The key to all this is;
Someone starting a part time side hustle is going to pay rent or a mortgage regardless of whether that business has made money or not. They also get to write off part of electricity, heat, repairs, condos fees, mobile phone costs, internet and more!
Tax deductions are not exciting usually, because you spend money and reduce only the tax paid, getting only that portion as a rebate. But, in the case of a home based business, it’s different. Because you are already spending this money.
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