Hi - I am currently a full-time contractor, having returned to South Africa after living in the UK for many years. I would like to set-up a small business but am unsure as to which type of setup would be most suitable for tax purposes.
The small business will be making fabric/craft items with labour sourced from independent parties that will be paid per item i.e. not employees.
My contracting earnings put me in the higher tax bracket which prompts the question - if I register the business as a Sole Proprietor (due to simplicity), would any earnings then be added to my contracting earnings and therefore mean that I am taxed 40%? Or would earnings from the SP be taxed as a separate entity?
Any information most appreciated.