If you're a small business owner, here's how you can save R34 291 in 72 hours
Our client wrote into the Accounting and Tax Club to find out if her business benefits from registering for Turnover tax, if it's annual turnover doesn't reach the Vat threshold. Read on for the Q&A...
+++ How can you be sure, with changing laws and regulations, that you…
- Interpret regulations correctly?
- Record company finances correctly?
- Avoid penalties and fines ...
And can you prove it to SARS or your auditors?
I have the solution.
Should I register for Turnover tax?
I'm a sole proprietor. I work from home with high profit margins. My business isn't Vat registered, because the turnover's less than R1million. For some background: I have no full time employees. My core business is advertising & printing to a large customer base. Should I register for Turnover tax to reduce my tax liability? Here are my questions:
Can I register for turnover tax with this type of business?
My turnover is approximately R630,000 per year. My taxable income is approximately R272 000 per year.
Let's see what the answer is…
139 Reasons why SARS doesn't want you to see this...
One of our experts, Annja Louca, answered the question for us. This is what she said.
Turnover tax is voluntary, and you can register for it if your turnover is under the Vat threshold of R1 million. It's only available to businesses who meet criteria, such as not performing personal services.
I'm going to answer your question in two parts...
It's your decision if you want to voluntarily register for Turnover tax. But in this case, it would mean a saving of R34 291.00!
If you'd like to ask your accounting related questions and have an expert response within 72-hours, from an expert like Annja Louca, click here.
Based on the information you've provided, it sounds as if you can register for Turnover tax.
The turnover tax you'll have to pay on R630 000 is R10 700. If you aren't registered for Turnover tax, you'll have to pay the normal tax rate. This means you'll owe the SARS R44 991.