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Essential Service Provider – Yes you can trade as a sole prop

Essential Service Provider – Yes you can trade as a sole prop

So you are a sole prop and essential service provider, but you have NO idea how to go about trading? After speaking to someone from the DTI this morning I have the steps needed for you to be able to trade. 

The first thing is you need to establish if you are an essential service provider, you can do that here http://www.gov.za/documents/disaster-management-act-regulations-address-prevent-and-combat-spread-coronavirus-covid-19 once you establish if you fall under the essential services bracket you need to print out the attached form below. 

You will need to print this on your company letterhead, complete the details and issue to each staff member – you need to list who the owner of the sole prop is and each employee that works under you, this is needed to be on your persons should you need to travel. You will need to also get an affidavit from the police station stating you do operate as a sole prop. 

If you have any questions that are not addressed herein please feel free to contact me on my email address. 

FORM-2-PERMIT-TO-PERFORM-AN-ESSENTIAL-OR-PERMITTED-SERVICE

 

 

COVID – 19 Relief Fund

COVID – 19 Relief Fund

Unpresidented Times  

Currently, South Africa is on Lock-Down, meaning no one is allowed to operate unless you are an essential service provider. That means for many, our doors are shut with no income being generated. Government has put in place a relief fund for SMME’s and other forms of enterprises 

Below is a PDF document that outlines all the funding available and the process of application  

Relief-Funding-and-Loans

Yes, you DO need to lodge a return…

Yes, you DO need to lodge a return…

Tax Season starts next month (1st July 2019), and I know that some are excited and some are just petrified. Most of the time, the fear comes from uncertainty or the fact that they have not lodged their returns and rather choose to take the ostrich approach… 

“Do I need to lodge a return? Should I submit, I honestly don’t make enough money to lodge” 

I hear this on the regular… HOWEVER, if you are self-employed (Sole Prop / PTY) it doesn’t matter what your income/sales/turnover is you still have lodge a tax return. The only time that you are exempt (and I still recommend that you submit a return) is when you are employed by a business and only earn 1 source of income and have NO deductions other than PAYE and UIF. 

I know its easier to look away than face any returns that are outstanding but I promise you, if you just start somewhere you are already further than where you were yesterday. 

If you want to chat about your tax or accounting I am just a mail away. 

Much love

Tania. 

How does your marriage contract affect your tax return?

How does your marriage contract affect your tax return?

HOW DOES YOUR MARRIAGE CONTRACT AFFECT YOUR TAX RETURN?

ICOP – In Community of Property

  • Interest – Jointly held bank account
  • Spouse A: 50% of Interest
  • Spouse B: 50% of Interest

 

  • Foreign Dividend paid to spouse A
  • Spouse A: 50% of Dividend Income
  • Spouse B: 50% of Dividend Income

 

  • Rental Income
  • Spouse A: 50% of income and expense
  • Spouse B: 50% of income and expense

 

OCOP – Out of Community of Property

  • Interest paid to Spouse B
  • Spouse A: Nil
  • Spouse B: Will be taxed in the hands of the owner of the investment at 100%

 

  • Foreign Dividend paid to Spouse A
  • Spouse A: Will be taxed in the hands of the owner of the investment at 100%
  • Spouse B: Nil

 

  • Rental income; owned by spouse B
  • Spouse A: Nil
  • Spouse B: 100% Rental income and expenses

 

  • Rental income; each spouse owns 50%
  • Spouse A: 50% of rental income and expenses
  • Spouse B: 50% of rental income and expenses

source: Tax Talk issue 70

 

No Tax Number – No Job

No Tax Number – No Job

 

So lately I have come across a lot of employers who are asking for employees tax numbers before they are considered for a position.

This issue has actually been addressed with SARS and they have stated the following ” While SARS will readily assist persons who approach our branches to register, such processes are placing an unnecessary burden on both the prospective employees and on SARS branches”.

SARS goes on to state that they don’t require a person to have a tax number prior to being employed for the first time.

SARS has made it very easy for employers to register their employees for tax by various means;
– Registering them on Easyfile
– New applications on SARS Efiling
– Bulk registrations on Easyfile

Source; TaxTalk issue 71

 

Provisional Tax

Provisional Tax

Today’s Topic is Provisional Tax

I will explain what it is how it works and when its due

Provisional tax is broken down into 2 returns (there is a 3rd option that is also available).  

What SARS asks is that we guesstimate what our taxable income will be by the time year-end comes, then what we do is split this up into 2 periods (August being the first) and (February being the second) 

It is very important to note that provisional tax is not a separate tax from your income tax, it’s simply a provision for your income tax  😊 it also helps taxpayers settle their tax liability over time and not have to come up with funds all at once.

If you have overstated on your provisional tax eg: I had to pay in R 10 000 of tax but when I lodged my tax return I was only due to pay R5000 SARS will refund you the difference. I always believe its better to overestimate than underestimate or you will face penalties.  

So, who needs to pay provisional tax?

  • Any person who receives income other than remuneration or allowance from an Employer who is not registered for Employees Tax
  • Any Company
  • A person who has been notified by SARS that they must become a provisional taxpayer.

Your first period is August, so this will be referred to as the 201901 IRP6 Return and your second is in February and this is referred to as the 201902 IRP6 Return. The first return is due by the end of August and the February one is due by the end of February 😊

 

If you found this helpful let me know in the comments below 😊