How New VAT Thresholds Are Reshaping SME Year-End Planning
For the first time in 30 years, South Africa’s compulsory VAT registration threshold has increased to R2.3 million, forcing thousands of SMEs into difficult financial and tax decisions at year-end. While the R1.3 million increase offers immediate compliance relief, treating the reform as a simple cost-saving exercise could jeopardise the long-term cash flow and corporate […]
The ‘Big Three’ Tax Worries (Part 2): Shares
In the second part of this series, we focus on shares. If claiming against our car allowances is the number one thing that keeps us awake at night as taxpayers, then the fear of SARS lying in wait to lay their grubby paws on the slightest gain that we make on our share investments must […]
Set-Off of Assessed Losses, and Ring-Fencing
Unless you’re at the 45% marginal tax rate, most losses can be set off against other income. If a person is not at the maximum marginal tax rate, can they opt to have their taxable loss from their sideline business, e.g. bookkeeping, offset against the taxable income from normal employment (on which they pay PAYE) […]
The ‘Big Three’ Tax Worries (Part 3): Property
Rounding up our series on the three main worries for taxpayers, we discuss property. So, you now know how to claim your car expenses on your tax return, and are reasonably confident that you can now manage your share investments without incurring the wrath of SARS. But the one thing that really keeps you awake […]
Ten Easy Ways to Save Tax
No fancy schemes, loopholes, or expensive lawyers required – and it’s all perfectly legal! Paying tax is a legal responsibility, but that doesn’t mean you can’t make the most of legal avenues to reduce your tax burden. SARS provides a number of tax-efficient strategies that individuals and businesses can use to reduce their taxable income. […]
The ‘Big Three’ Tax Worries (part 1): Cars
What keeps taxpayers awake at night? Judging by the many questions that I’ve been asked as a tax practitioner over the years, there is a definite ‘Big Three’ when it comes to problems that cause taxpayers sleepless nights: cars, shares, and property. The tax treatment of these three items probably causes more anxiety, and has […]
Tax Issues Relating to Independent Contractors
The following question was recently received from one of our readers: I see myself as an independent contractor as I do contract work (project management) for different companies. In the 2023 income tax year, I worked for four companies, of which only one indicated on their IRP5 under code 3616 that the income I earned […]
Understanding Residency in Terms of Tax
When earning an income in South Africa, you are probably paying tax. The Income Tax Act 58 of 1962 (“the Act”) describes gross income as: “(i) in the case of any resident, the total amount, in cash or otherwise, received by or accrued to or in favour of such resident; or (ii) in the case […]
What’s In a Name?
The differences between an allowance, an advance, and a reimbursement are critical when it comes to tax. What’s the difference between an allowance, an advance, and a reimbursement? To many people, these are different terms for the same thing, but to SARS, the category that a payment falls into is critical when it comes to […]
Long-Term Goals, or Short-Term Gains?
More than a million applications have already been lodged with the South African Revenue Service (SARS) to pull funds out of their savings. Given that this amounts to R21.4 billion, that’s a frightening amount of money for a country that doesn’t have a savings culture. What with more people withdrawing cash under the Two Pot […]