Results 1 to 3 of 3

Thread: Sole prop tax issues

  1. #1
    New Member
    Join Date
    Aug 2012
    Location
    dbn
    Posts
    6
    Thanks
    2
    Thanked 0 Times in 0 Posts

    Sole prop tax issues

    I have started a cake business , my annual income for the past year was 130K, how do I go about preparing an Inc statement? Do I take all the Sales less all the related exp to calc the Profit, or do I have to do a cash book & bank recon & then calculate the business profit.
    I assume I will pay tax on the profits only , what about my drawings each month?
    How do I register the uif & paye of my business on efiling?
    thanx

  2. #2
    New Member
    Join Date
    Aug 2012
    Location
    johannesburg
    Posts
    1
    Thanks
    0
    Thanked 1 Time in 1 Post
    Hi kris. Your drawings are taken from net profit- it is the net profit figure which is taxed. If you were an ltd company your drawings would be taxed at personal rates of taxation.

    Example
    If your net profit is 100k, and you have taken 30k in drawings. You are taxed on the 100k in the normal way; you are not taxed again on the drawings figure.

    Yours accounts should look something like the following:

    Sales/Income

    less Cost of Sales i.e. Purchases/Stocks etc

    = Gross Profit

    less Expenses i.e Wages to employees, light, heat, telephone etc

    = Net Profit

    This net profit figure is then taxed. Your drawings figure will be a portion of this net profit otherwise you will have a negative capital account for the year.
    Cashbooks can help you capturing all the payment and receipt for a particular month or duration and If you have employees, you are required to make UIF contributions on their behalf. These contributions are partly deducted from the employees' salaries and are partly paid by the employer
    I can also help you with bookkeeping services and registration of UIF.

    Best of luck with it.
    Last edited by Dave A; 17-Aug-12 at 08:28 PM.

  3. Thanks given for this post:

    Kris (16-Aug-12)

  4. #3
    New Member
    Join Date
    Aug 2012
    Location
    dbn
    Posts
    6
    Thanks
    2
    Thanked 0 Times in 0 Posts
    That makes alot of sense, thank you.
    With regards to the staff tax, can i log onto my sars personal efiling profile & add the uif & paye or is it a separate profile for companys.

    Quote Originally Posted by clearence View Post
    Hi kris. Your drawings are taken from net profit- it is the net profit figure which is taxed. If you were an ltd company your drawings would be taxed at personal rates of taxation.

    Example
    If your net profit is 100k, and you have taken 30k in drawings. You are taxed on the 100k in the normal way; you are not taxed again on the drawings figure.

    Yours accounts should look something like the following:

    Sales/Income

    less Cost of Sales i.e. Purchases/Stocks etc

    = Gross Profit

    less Expenses i.e Wages to employees, light, heat, telephone etc

    = Net Profit

    This net profit figure is then taxed. Your drawings figure will be a portion of this net profit otherwise you will have a negative capital account for the year.
    Cashbooks can help you capturing all the payment and receipt for a particular month or duration and If you have employees, you are required to make UIF contributions on their behalf. These contributions are partly deducted from the employees' salaries and are partly paid by the employer
    I can also help you with bookkeeping services and registration of UIF.

    Best of luck with it.
    Last edited by Dave A; 17-Aug-12 at 08:28 PM.

Similar Threads

  1. [Question] Sole prop expenses
    By Nico Erasmus in forum Tax Forum
    Replies: 1
    Last Post: 10-Aug-12, 06:40 AM
  2. Moving from sole prop to company
    By Pap_sak in forum General Business Forum
    Replies: 5
    Last Post: 26-May-11, 05:50 PM
  3. cc/sole prop
    By murdock in forum Business Finance Forum
    Replies: 7
    Last Post: 11-Nov-09, 08:18 PM
  4. A few questions about CC VS Sole prop
    By Pap_sak in forum General Business Forum
    Replies: 13
    Last Post: 20-Sep-08, 01:00 PM

Did you like this article? Share it with your favourite social network.

Did you like this article? Share it with your favourite social network.

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •