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 […]
Tax Rules You May Not Agree With, But Need to Plan For
Do you ever get the sense that SARS sometimes wants to have their cake and eat it? By this, I’m talking about situations where it appears that having already extracted tax on a particular amount received, SARS takes a second bite at the cherry. And on the fact of it, that’s not fair! I often […]
Death Is Unavoidable, But Estate Taxes Can Be Planned For
Estate duty is one of those taxes that many people know about in theory, but very few actively plan for. It only becomes real when a loved one passes away and the estate is wound up, often revealing how much value quietly leaks away to taxes, fees, and avoidable inefficiencies. The reality, however, is that […]
Investing in a Child’s Name? They Gain, You Pay
The reasons for putting an investment in a child’s name may well be altruistic, but it could backfire when it comes to tax. I can’t believe it’s been 13 years since my wife and I were thinking about our son starting high school. With me at seminary at the time, training to enter the Methodist […]
Transform Your Tax Compliance with Intelligent Automation
Tax compliance has evolved into a year-round responsibility. As SARS continues to expand its use of automated verification, data analytics, and AI-driven matching, businesses can no longer rely on last-minute submissions or outdated processes. Even small oversights, like an incorrect figure, a late submission, or an incomplete schedule, carry significant consequences. But the issue is […]
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 […]
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) […]
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 […]
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. […]
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 […]