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Thread: The Need to Knows about Tax

  1. #1
    Email problem Dastan Kieton's Avatar
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    The Need to Knows about Tax

    If you trade as a PTY you and your business are separate legal entities which means you will have to submit annual income tax for the two. There are unique reference numbers for each submission. Below is what are sars requirements for you as a business

    Provisional Tax
    This includes income obtained from outside your employer. In the case of a sole proprietor you are requested to pay tax semi-annually. The first period for the provisional tax is February till August and the second is September till February. Thereafter tax liability is calculated and credited to your tax account. Depending on the calculation it may result in overpayment therefore sars will refund you or a shortfall which you will need to pay into sars by specified date.

    PAYE
    If you have staff employed sars tax is deducted on a monthly basis. You as a business will have to register for PAYE, UIF and SDL. Independent contractors that earn more than 80% of their salary from your company will need to be taxed as employees.

    VAT
    If your company has a turn of over 5 million annually you will qualify for Vat, you will therefore need to notify sars and register. As a company you will be able to claim Vat this however, means the company will have pay Vat as well. The Vat process has deadlines that you will need to comply with and if you fail to do so there will be penalties. Ensure all invoices have correct company details on to ensure they are accepted. If you are not registered for vat your invoices should state that you are not registered for vat.

    Why hire a Bookkeeper
    It is imperative to keep up to date records. This ensures that sars filling is simple and hassle free. You should submit a tax clearance certificate with the submission of sars claims.

    The process of sars registration can be complex and if you do not comply with there requirements your business will pay heavy penalties.

  2. #2
    Site Caretaker Dave A's Avatar
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    Quote Originally Posted by arora View Post
    VAT
    If your company has a turn of over 5 million annually you will qualify for Vat, you will therefore need to notify sars and register.
    R5 million?



    Last I checked mandatory registration for VAT kicks in at a turnover of R1 million per annum.
    Last edited by Dave A; 01-Nov-12 at 09:59 AM. Reason: update
    The trouble with opportunity is it normally comes dressed up as work.

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    Darn, you beat me to the first post of the day!!

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    Site Caretaker Dave A's Avatar
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    I didn't know there was a race, honest
    The trouble with opportunity is it normally comes dressed up as work.

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    Haha. Dave, all of life is a race! I came in early for work and thought I'd have a quick read of the Forum then saw thre was no new posts...2secs later I swa your post. Very dissapointing. Haha

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    Site Caretaker Dave A's Avatar
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    Just adds to the fun in what could be a very dry thread

    As the "winner" today (albeit accidental), I'll be sure to wait until someone else has posted first tomorrow
    The trouble with opportunity is it normally comes dressed up as work.

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    HI to all
    Please help just started an enterprise - electrical still in the "Trading as" stage. When do I have to worry about paying Tax. is there a honeymoon period?
    Thanks
    E

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    Site Caretaker Dave A's Avatar
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    Quote Originally Posted by ericlowry View Post
    is there a honeymoon period?
    Only as long as you can hide, I'm afraid. And if they find you first, the penalties could be terminal.

    If I was starting out fresh in the service industry, probably one of the very first things I'd do is register for the small business turnover tax deal.
    The trouble with opportunity is it normally comes dressed up as work.

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    Mr Arora,Sir, with all due respect, may i ask if your are a business studies student? or teacher? Thank you

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