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New VAT Rate 2018

On the 21st of February 2018 the Minister of Finance announced an increase in VAT - from 14% to 15%, effective from 1 April 2018.This means that, if your business is VAT registered, you must charge the new rate of 15% on services rendered or goods delivered after 1 April 2018. Although this may sound simple enough, there are a few exceptions. Where an agreement to deliver goods was entered into before 1 April 2018, such goods can still be delivered and invoiced for at the current VAT rate...

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Compensation Fund

Compensation fund: As a company it is important that you register with the Workmen’s Compensation Fund in order to insure your workers against occupational disease, injuries and death.It is important to note that all employers who employ one or more workers need to register with the Workmen’s Compensation Fund and this will need to be done separately for all the different branches within your business, unless you have made arrangements for combined registration.The compensation for Occupati...

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Payroll

A payroll is a company's list of its employees, but the term is commonly used to refer to: the total amount of money that a company pays to its employeesa company's records of its employees' salaries and wages, bonuses, and withheld taxesthe company's department that calculates and pays the salaries.Payroll in the sense of "money paid to employees" plays a major role in a company for several reasons.From an accounting perspective, payroll is crucial because payroll and payroll taxes considerably...

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VAT

What is VAT?Value-Added Tax is commonly known as VAT. VAT is an indirect tax on the consumption of goods and services in the economy. Revenue is raised for government by requiring certain businesses to register and to charge VAT on the taxable supplies of goods and services. These businesses become vendors that act as the agent for government in collecting the VAT. VAT is charged at each stage of the production and distribution process and it is proportional to the price charged for the goo...

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CIPC Annual Return

CIPC annual returns: All companies (including external companies) and close corporations are required by law to lodge their annual returns with CIPC within a certain period of time every year.An annual return is a statutory return in terms of the Companies and Close Corporations Acts and therefore MUST be complied with. Failure to do so will result in the Commission assuming that the company and/or close corporation is not doing business or is not intending on doing business in the near future...

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Company Registration

A private company is the most common and simplest form of company to be registered. It is comparable to a close corporation. Close corporations are no longer registered.Private Companies may not offer shares to the public and restrictions are also placed on the transferability of their shares. Private companies must have at least one director and one incorporator. The director and incorporator may be the same person. The word “person” includes a juristic entity. This means that a legal entit...

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Trust Income Tax Return

A trust is a "person" for tax purposes and is therefore a taxpayer in its own right. The ITR12T must be completed and submitted by the trustees of the trust, or the tax practitioner appointed by the trustee(s).The following special trust types are recognized for tax purposes: "Special Trust" – Type A: the trust is created solely for the benefit of one or more person who is a relative of the founder and has a disability as defined in section 6B (1) and such disability incapacitates such person ...

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Financial Statements

Annual Financial Statements, or Financial Report, is a structured presentation of relevant financial information of a business, or individual. The complexity of a Financial Statement may vary from business to businesses depending on the industry and size of the business.Financial Statements typically include: A balance sheet that shows the company’s financial position which summarises a business's assets, liabilities, and owners equity at a given point in time – usually at the end of a finan...

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Management Accounts

Proper Prepared Management Accounts will show business owners the following: How the current state of a business compares to the budget and forecastSales, expenses, debtors and creditors trendsCash flow situation for the following 2 monthsCapital expenditure the business is likely to incur in following monthsWhat expenditures can be financedThe lack of the information mentioned above can lead to inadequate financial planning that may, in turn, lead to the business’s self-destruction.One can sa...

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Processing of Financial Transactions

Every transaction that involves money, whether income or expense, is a financial transaction. Processing these financial transaction is basically the process of sorting these transactions into categories to get a better picture of where income came from, and on what money was spent on.This ultimately helps an accountant to establish how much TAX and VAT are payable, but also how much can be claimed back from TAX and VAT.For businesses processing of financial transactions is an ongoing process, w...

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Provisional TAX

What is provisional TAX?The aim of provisional TAX is to help taxpayers (companies and individuals) meet their liabilities in the form of two payments, instead of a single large sum on assessment.Who must register for provisional TAX?All trading businesses must register for provisional TAX. Because businesses don't make provision for TAX by means of monthly PAYE (Pay As You Earn), the TAX amount upon assessment are usually large.Individuals that earn income other than a salary or an allowance mu...

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Individual Income TAX Return

Below are a few frequently asked questions that we'll briefly discuss about Individual Income TAX Returns. Should you file a TAX return?If you earned less than R350 000.00 during the 2016/2017 year of assessment (between 1 March 2016 and 29 February 2017), you do not have to submit an income TAX return, provided that: You only have one employer. However, if you have more than one source of income (eg. second employer, rental income etc.), you’ll need to file a TAX return, even if the combi...

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End of Financial Year

End of Financial YearEnd of the financial year, or EOFY in short, is an important and busy time for business owners – and employees involved. EOFY consists out of a number of accounting and financial tasks that needs to be finalised. Putting hard work in each financial year will help you get your business organised and help with planning to work smarter in the year ahead. Here are a few points to take into account when taking on your End of the financial year: Summarising income and expen...

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Interim EMP501 Reconciliation Returns

The Employer Interim Reconciliation submission period is currently open until 31 October 2017 - these are Reconciliation Declaration (EMP501) and Employee Income Tax Certificates, IRP5/IT3 (a), for the six month period between 1 March 2017 and 31 August 2017.What is an EMP501?An employer needs to submit a reconciliation showing details of the total amount of Employees' Tax (Pay-As-You-Earn, or PAYE), Skills Development Levy (SDL), Unemployment Insurance Fund (UIF) and/or Employment Tax Incenti...

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