Articles & Tips

As part of ongoing efforts to streamline tax processes and ensure accurate reporting, SARS has introduced a new requirement for trusts: the IT3(t) form.

The new IT3(t) requirements for trusts will be effective for the 2024 tax year. Trustees are required to submit the IT3(t) certificates by 31 May 2024. This means that all distributions made to beneficiaries between 1 March 2023 and 28 February 2024 must be reported using the IT3(t) form by this deadline.

The South African Revenue Service (SARS) has introduced a new security measure for individual taxpayers using the eFiling system. Starting from 22 November 2024, SARS will require all individual taxpayers to register a cellphone number to their eFiling profile and enter a One Time Pin (OTP) for certain actions. This new requirement aims to enhance the security of your tax profile and protect your personal information.

Proper record-keeping is essential for accurate tax reporting and compliance with the Tax Administration Act and other relevant tax laws in South Africa. Maintaining accurate and complete records is crucial for a few reasons: It substantiates the information reported in your tax returns, It enables you to respond effectively to any queries or audits from SARS, and it provides a clear financial history, which is beneficial for personal financial management and planning.

We understand that the thought of a VAT audit can be daunting, but it needn’t be. With the right preparation and a thorough understanding of the process, it can be a smooth and stress-free experience.

In this blog, we will provide you with an overview of why a VAT audit happens in South Africa, what the process entails, and how we ensure that all necessary documents are ready and available from the start.

With the growing popularity of cryptocurrencies, it's crucial to understand how these assets are treated by the South African Revenue Service (SARS) and why you need to disclose them in your yearly tax return.

SARS requires that any income or gains from crypto assets, including digital wallets and crypto accounts, be disclosed in your tax return. This includes exchange tokens (such as Bitcoin), non-fungible tokens (NFTs), and utility tokens.

South Africa has a Dividends Tax regime, which taxes dividend income at a flat rate of 20%, regardless of the amount. One crucial aspect to keep in mind is that dividends are paid out of a company's profits after company taxes have been paid. In South Africa, the standard corporate tax rate is 27%. This means that before any dividend is declared, the company must first pay tax on its profits at this rate.

A Compliance Tax Pin from SARS (South African Revenue Service) is a digital tool that allows individuals or entities to prove their tax compliance status to third parties. It is essential for various reasons, including: Tender Applications: When applying for government or private tenders, it is often required to show proof of tax compliance. A valid compliance tax pin provides quick verification.

As you continue to plan for your retirement, it's crucial to understand the two-tier retirement pot system recently implemented in South Africa and how withdrawals from your retirement fund can affect your tax obligations.

Starting September 1, 2024, contributions will be split into savings and retirement components at a ratio of one-third and two-thirds, respectively. The two-tier retirement pot system was introduced in South Africa to provide greater flexibility and security for individuals when they retire.

As a self-employed professional in South Africa, your business is your livelihood. Whether you're a consultant, freelancer, tradesperson, or small business owner, the income you earn is dependent on your ability to work. But have you ever considered what would happen if, due to an unforeseen illness, injury, or accident, you were suddenly unable to work?

The team is hard at work at making our clients' lives easier and, we hope, better. Loads of business owners want to do their own accounts, but don’t know how Xero works, or want to have an accounting practice to help them to do it properly and accurately themselves, because they want to learn.

Written by Roulon du Toit CA (SA)

Both executive directors and non-executive directors (NEDs) may earn income from the companies in which they hold office. However, the tax treatment of these earnings—and the related expenses incurred—vary greatly between these two types of directors. In 2017, SARS released two Binding General Rulings (numbers 40 and 41) which provided more clarity on the treatment of NEDs.

Written by Roulon du Toit

A lot of South African taxpayers are unaware that they could reduce their taxable income if they made donations to Public Benefit Organisations. When a South African resident makes a donation, it is important to realise that there are tax consequences which may lead to either an increased tax burden or tax relief.

First, it is important to note that donating may attract a Donations Tax liability. This is something that taxpayers are unaware of and can be quite costly. We will not be exploring this in this blog, but be aware that if you donate cash (or any other asset) there may donations tax, especially if the value exceeds R100 000. For example, if you purchase a car and then transfer ownership to your child it will likely attract Donations Tax.

If you are registered as a company or sole proprietor in South Africa, you can choose to pay either standard small business income tax rates or turnover tax.

Turnover tax is a simplified tax rate aimed at reducing administration for small businesses with an annual turnover of less than R1 million. If your turnover goes over R1 million, then you will need to register for VAT and pay tax on the standard tax rates.

Tax-deductible business expenses are any expense incurred in the production of income or in the running of the business.

For example, stock bought for resale is considered a business expense or stationery bought for the office is also considered a business expense. You must keep a record of these business expenses.

When it comes to decreasing your VAT bill in South Africa, it's crucial to adhere strictly to legal methods and maintain meticulous accounting records. While it may be tempting to look for shortcuts, any attempt to evade taxes illegally is not worth the risk and can lead to severe penalties.

If your business's turnover exceeds one million rand in a 12-month period, VAT registration is mandatory. Ensuring you claim the maximum possible inputs can significantly reduce your cash outflows.

In the rapidly evolving world of business, staying ahead of the curve means embracing tools and technologies that streamline operations and drive growth.

As your accountants, we're always on the lookout for ways to help you achieve greater efficiency and success while reducing your admin overheads and stress!

On June 4, 2024, the South African Revenue Service (SARS) made a significant announcement regarding the 2024 income tax return filing dates for both individual and trust taxpayers.

This update marks a big shift, particularly for trust taxpayers, who will now experience a dedicated filing season distinct from that of individual taxpayers.

Traditionally, the filing season for trust taxpayers in South Africa coincided with that of individual taxpayers.

Auto-assessments notices start on the 1st of July until the 14th of July. The tax season officially opens on the 15th of July 2024 and closes on the 21st of October for non-provisional taxpayers and 20 January 2025 for provisional taxpayers.

If you want to know if you are a provisional taxpayer, you can either see this on your assessment from prior year or you can ask us 😊

Here’s a date for your diary - 24th of May, 2024. Now, that’s a rather important date if you hold a 5% or greater stake in a company in South Africa as it’s the last date to register under the newly introduced Beneficial Ownership Register. Failure to register if you should will be seen as a breach of the Companies Act and could result in fines being levied.

So what’s this all about, and what is Beneficial Ownership?

Managing a business involves a lot of responsibilities, with payroll management being one of the most critical. Understanding the intricacies of the payroll system in South Africa is essential for compliance and smooth operations, whether you're a startup or a seasoned business operator.

Here's a simplified breakdown of the payroll process.

As the start of a new tax year approaches, it’s time to shift our focus towards effective tax planning and ensuring a smooth filing process when the time comes.

For South African taxpayers, this means being proactive about retirement annuity contributions and keeping track of important documents as well as remembering to track your travel if you receive a travel allowance.

With filing season typically kicking off in July, now is the perfect time to get organised and stay ahead of the game.

I thought it would be nice to write about something other than tax and year-ends. Yes, they’re important, and yes I’ll continue to write about them, but a change, they say, is as good as a rest. (Personally, I’m not sure about that, but whatevs…)

As thoroughly modern accountants we have wholeheartedly embraced technology, you may have noticed this! In addition to our client-facing systems we use technology ourselves to stay on top of our business.

As the year progresses and you contemplate ways to reward the dedication and hard work of your teams (and perhaps yourselves as directors), gift vouchers emerge as a popular and appreciated token of gratitude.

However, your largesse should also be tempered with an understanding of the tax implications such gestures carry, especially under the regulations of SARS. This guide aims to shed light on these implications, ensuring that your acts of appreciation are both generous and tax compliant 😆.

Thinking about the end of the tax year does tend to induce a sense of mild dread; what will SARS want? When will they want it? Will this ever end?! 😆

While it can feel onerous, there are some things you can do before the end of the tax year which are very much to your benefit, rather than the wellbeing of the tax authorities. One of the biggest of these is topping up your retirement fund or pension fund before the end of the tax year in South Africa (which runs from 1 March to the end of February).

In South Africa, managing a (Pty) Ltd company involves understanding tax obligations and benefits as outlined by the South African Revenue Service (SARS). One of the questions that arise in the realm of tax deductions involves the eligibility of claiming expenses for reading glasses. This blog delves into whether reading glasses can be considered a deductible expense under current South African tax laws for (Pty) Ltd companies.

In South Africa, the rules for deducting travel expenses for directors of small proprietary limited companies (Pty Ltd) are governed by the South African Revenue Service (SARS).  These rules can be quite specific and are subject to change, so it's always best to consult the latest SARS guidelines or a tax professional. However, we can provide a general overview.

Well, that’s Christmas and New Year done, and we’ve all had plenty of time to clear our heads and face up to 2024! So, Happy New Year, and let’s talk about… Tax!

We know - it’s not the most thrilling subject, but a failure to deal with it in a timely manner will guarantee you interesting times as SARS starts asking pointed questions.

So, what are the filing dates for 2024? Fortunately for all of us, these are no secret, SARS posts these on its website, but here’s an extract of the relevant information:

It was lovely having Esmerelda visit the Anlo Financial Solutions Edinburgh office in September. Lots of strategy meetings happened and lots and lots of walking through the beautiful city. If you don’t know, Esmerelda runs the Anlo Financial Solutions Johannesburg office and Annja runs the Anlo Financial Solutions Edinburgh office.

Please see a quick list of expenses to remember which can qualify as a tax deductible. If you have incurred the expenses in your personal capacity, then still let us know about these expenses. If you have the invoice, we can still include it.

Running a business comes with its fair share of expenses and it is important to understand when these expenses can be used against income as a valid business tax deductible expense.

Deducting the right expenses can significantly reduce your taxable income and, consequently, your tax liability.

In this blog, we will look into the deductibility of various business expenses, focusing on repairs and maintenance, entertainment, staff welfare, and gifts.