Monday, January 31, 2011

Tax Matters For Micro Businesses


This morning I uploaded an article to masterbuilders.co.za authored by Aneesa Khan which will no doubt be of interest to small business owners. It centre’s around SARS having introduced a turnover based tax system, to assist micro businesses in handling their tax affairs.

It is all encompassing and replaces five other tax types namely: VAT, Income Tax, Capital Gains Tax, STC and Provisional Tax. As Aneesa so elegantly put it, it is designed to reduce the administrative burden and costs on micro businesses in order to streamline their tax obligations.

In theory it is an excellent idea, for a small operator it can prove extremely challenging to determine the accurate amount, they are legally obligated to pay and my understanding of it is, this new system will simplify it to the nth degree. On the face of it, it sounds like SARS have been extremely proactive and perhaps should be commended.

I do however believe that when it comes to matters relating to tax it is always wise to proceed with caution. If there are two systems on offer there will no doubt be pros and cons to both and if you do qualify and are somewhat unsure, I would seek the advice of a tax consultant, one who has a reputation for knowing his or her stuff.

Ernest Roper
Webmaster

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