Over 3 766 businesses are liquidated every year in South Africa. Will your company be next?
If your company looks like you might have to shut its doors, I have a lifeline for you. It's called business rescue.
It's the legal process you can use to help rescue your business if it's in financial difficulty. And it's probably your last chance to get your business back on its feet.
Let me show you how it works so you can save your business from liquidation...
How to make yourself invisible to SARS
The key to reducing how much tax you pay is staying off SARS' radar.
SARS has conducted R1.8 million audits.
They've added 100s of new tax collectors and auditors to their payroll and each one has his own collection targets to meet. This means two things:
If you're not compliant, your chances of an audit this year have just doubled, and
You will pay more in penalties.
But there are 139 perfectly legal ways for you to make yourself invisible to SARS.
How business rescue can save your company form going into liquidation
Before we look at how it can help your company, let's look at what business rescue actually is.
If you think your company is in serious financial trouble you can ask your attorney or auditor to help put your company under business rescue.
And by serious financial trouble I mean you can't pay your creditors, can't pay SARS the tax you owe, battling to pay your staff and don't see any way out of the debt you are in.
Your attorney or auditor will appoint a business rescue practitioner (BRP) to help you through the process. They will help reorganise and restructure your company with the aim of returning it to a more stable and profitable entity.
The BRP is now responsible and will control all your company's finances. He'll also decide early on in the process if you can actually rescue your company.
If you can't, you need to proceed to liquidation. But, if you can rescue your company, the BRP will work hand in hand with you to control the creditors your company currently has. He will steer your business back to profitability.
Business rescue doesn't excuse you from repaying your debts. But it does help you delay paying pre-existing debts and to continue trading until you rescue your business. You'll then have to pay your creditors the pre-existing debts.
Here's a simple process you can follow if you need to put your company into business rescue…
Pravin Gordhan has thrown you a Capital Gains Tax lifeline
Giving a huge percentage of your profits to SARS can feel like stabbing yourself in the eye…
Just when you're about to bank your hard-earned money, SARS swoops in and takes a huge chunk in Capital Gains Tax (CGT). Money that could be used to pay off debts, improve company processes and reward hard-working employees.
But here's some good news for every bewildered CGT taxpayer…
Three steps you must follow to put your company ubusiness rescue
Let's look at the process you should follow if your company is facing business rescue.
Step #1 - Complete a one-page form – the Notice of Beginning of Business Rescue Proceedings – and file it with the Companies and Intellectual Property Commission (CIPC).
Step #2 - Within five days of filing a business rescue resolution, your company must appoint a business rescue practitioner, conditionally licensed for the project.
Step #3 - You must file and publish the notice of appointment within two days of the appointment and inform all affected parties of the appointment.
It is important to note though, you can only go into business rescue if you haven't started liquidation proceedings. If you have, you won't be able to rescue your company.
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