Small Business Corporation
The best tax deal at present is the small business corporation. We can assist clients in all aspects, utilizing these lower tax rates.
| Years ending between 1 April 2018 and 31 March 2019 | |
|---|---|
| NET PROFIT | TAX PAYABLE |
| R0-R78 150 | NIL |
| R78 151 - R365 000 | 7% of taxable income above R78 150 |
| R365 001 - R550 000 | R20 080 + 21% of taxable income above R365 000 |
| R550 001 and above | R58 930 + 28% of taxable income above R550 000 |
A small business corporation is a close corporation or private company (other than a personal service provider) of which:
- The entire shareholding or member is held by natural persons,
- The gross income does not exceed R20million (previously R14 million)during the year of assessment,
- None of the members/shareholders, at any time during the year of assessment, held shares in any other company other than listed companies, collective investment schemes, body corporate, share block companies, certain associations of persons, friendly societies and small interests in cooperatives, shares in private companies that are inactive and have assets of less than R5 000 or have taken steps to liquidate, wind-up or deregister(effective for years of assessment commencing on or after 1 January 2011).
- Not more than 20% of the gross income and capital gains consists of investments income and income from the provision of personal services,
- If engaged in the provision of personal services, maintain at least three full-time employees(none of whom may be a shareholder or a connected person in relation to the shareholder) for core operations.
THE FOLLOWING ARE THE SAVINGS OF USING A SMALL BUSINESS CORPORATION AS COMPARED WITH A NORMAL COMPANY /CLOSE CORPORATION FOR TAX PURPOSES:
| SMALL BUSINESS CORPORATION | ORDINARY COMPANY / CLOSE CORPORATION | |
|---|---|---|
| Profit of R365.000 per annum | ||
| Tax on R75 000 | NIL | R21 000 |
| Tax on R78 150- R365.000(7)% | R20 080 | R81 200 |
| R20 080 | R102 200 | |
| SAVINGS | R82 120 | |
| Profit on R550 000 per annum | ||
| Tax on R78 150 | NIL | R21 000 |
| Tax on 67 112 -R365 00(7%) | R20 080 | R81 200 |
| Tax on R365 000 -R550 000 (21%) | R38 850 | R51 800 |
| R58 930 | R154 000 | |
| SAVINGS | R95 070 | |
Other Services We Provide Include:
- Taxation
- Completing personal and corporate income tax returns
- Financial Statements of Close Corporations
- Providing company secretarial services including Company and Close Corporations formations
- Accounting Services
- Advising generally on financial matters and financial management
- Due Diligence Investigations
- Computer Auditing
- Incentives
- Franchising
- Wills and Trusts
- Estate Planning and Administration
- International Tax
- New Business Establishment
- Listings
- Forensic Auditing and Investigations