The current economic conditions have significantly increased credit risk for many businesses already struggling to make ends meet. As important as securing ongoing business may be, it only contributes financially if payment is also received for goods or services rendered. Many business owners may therefore be considering implementing changes to their billing practices or payment terms in order to ensure payments are timeously received from all serviced customers. Those owners considering requesting advance payments or deposits from customers may need to take into account the tax and other consequences of doing so. Furthermore, landlords in the process of replacing tenants may be faced with refunding or applying deposits of vacating tenants as well as receiving deposits from new tenants taking occupation. In this article we will firstly be focussing on some of the key considerations of receiving advance payments or deposits; and secondly some of the implications of making such advance payments or deposits. 9 Oct 2020 Read more >> There have been two new developments at the South African Revenue Service (SARS) this month which will affect most companies. 3 Dec 2019 Read more >> Loans between related parties are a common occurrence in the SME business environment. These loans arise due to various reasons, such as assets being sold on loan account; money being drawn out, trust distributions made or dividends declared on loan account; funding provided by stakeholders, or even loans arising in a similar way to a trading account. Loans that may initially seem simple in principle, could lead to some unforeseen tax and legal consequences. 5 Nov 2019 Read more >> This article is aimed at addressing a misunderstanding regarding a certificate that auditors are often asked to sign, usually requested by an attorney attending to the transfer of a property (or requested by a bank in relation to a sale or purchase of property where a bond is involved). 2 Sep 2019 Read more >> Unemployment levels in South Africa are of the highest in the world. Rates consistently exceeding 20% include a large portion of our youth, the very generation that the future of our country depends on. 23 Jul 2019 Read more >> Emigration lawyers and consultants have noted a significant increase in the number of South Africans applying for financial emigration over the past two years. Many of these applications have been made in response to the proposed tax legislation changes which will come into effect from 1 March 2020, whereby South African tax residents working abroad will be required to pay tax of up to 45% on their foreign employment income which exceeds R1 million. All fringe benefits earned, e.g. housing and travel, as part of the expatriate's remuneration package, will also be taken into account for purposes of calculating the income to be subject to this taxation. 3 Jul 2019 Read more >> In an ever-evolving business world with labour-related issues becoming increasingly complex, many businesses are considering alternatives to obtain the resources and skills required. Examples of such alternatives include the use of independent contractors, labour brokers and personal service providers, among others. In many instances these provide simplified solutions to meet the immediate business need, but more often than not, these could lead to increased tax complexities, especially in relation to employees' tax. 4 Jun 2019 Read more >> Victor Hugo faced a major problem in the summer of 1830. He had promised his publisher a new novel by February 1831, but had spent most of the last twelve months finding every reason to do anything other than write. He had entertained friends, pursued other interests and generally created every distraction he could think of to take him away from the task at hand. With his back against the wall, he eventually came up with a most unusual plan. He asked his assistant to take all of his clothes away and lock them in a large chest. Left with nothing to wear other than a large shawl, he was forced to stay indoors and write. The result? The Hunchback of Notre Dame was published two weeks early on 14 January 1831! 30 Apr 2019 Read more >> We have seen a substantial increase in SARS compliance monitoring through their audit department and a requirement to submit an IT14SD. 26 Mar 2019 Read more >> A new year has dawned, and with it an ever-increasing pressure to be "better". Be fitter, healthier and richer. Own the latest car on the market and the most recent technology. The list goes on, and the standards by which we measure our lives get higher. It is easy to become despondent when one is bombarded by the constant pressures portrayed by the media to attain the "perfect life". Perhaps we should start looking at things from a different angle. 31 Jan 2019 Read more >> In the more relaxed business environment we operate in these days, it is still important to communicate in a professional manner. When sending business emails, you need to make an impression which will lead the receiver to conclude that you are a credible professional. 3 Dec 2018 Read more >> Many employees look at their bosses as well as the company they are working for and say - "I can do that. And better!" Similarly, many bosses in the SME space look at a key person in their organisation and believe that they need to give that employee some skin in the game in the form of shareholding in order to retain them. Both notions have their place in the right place and circumstances, but both are fraught with danger. Here are some of the things that both owners and potential future owners need to consider before taking the next step. 30 Oct 2018 Read more >> Section 66 of the Companies Act No. 71 of 2008 (the "Act") stipulates that the business and affairs of a company must be managed by or under the direction of its board of directors. The Act proceeds to codify the standard of conduct expected of directors and makes provision for directors to incur personal liability in instances of non-compliance. In the current business environment where poor governance and non-compliance with legislation frequent the press headlines, it is as important as ever to remain mindful of the statutory duties of directors. 1 Oct 2018 Read more >> You may be forgiven for looking at the great volumes of laws, regulations and publications around corporate governance and consider them irrelevant to a small company/business that is closely managed by the owners thereof. 31 Aug 2018 Read more >> We live in a time of ever-increasing living costs and financial pressure. Fuel price hikes. Food price increases due to the drought. High interest rates. Rising taxes. It is becoming more and more difficult to save, and for some people it often feels like an accomplishment just surviving from payday to payday. This struggle from month to month makes it easy to forget the importance of saving for our future. 30 Jul 2018 Read more >> Millennials, a word used for those reaching young adulthood in the early 21st century, are an enigma to the older generations as they strive for both financial independence and personal fulfilment. 28 Jun 2018 Read more >> The recent corporate scandals that have rocked South Africa, and in particular the role that auditors have played in not preventing these scandals, is a cause for concern for all business in South Africa. 29 May 2018 Read more >> Over the past several years, cryptocurrencies such as bitcoin have been growing rapidly in popularity. This increased attentiveness and speculation regarding the future of cryptocurrencies has prompted calls for SARS to provide direction as to how cryptocurrencies should be treated for tax purposes. On 6 April 2018, SARS released an announcement clarifying its stance in this regard. In this article we will look into what guidance has been provided, some key questions which still remain and how we can help our clients prepare for their next tax return. 30 Apr 2018 Read more >> The budgeting process and annual tax law changes consist of far more than the annual budget speech which takes place toward the end of February every year. In this article we will be looking at the annual cycle of tax law changes, and when this filters into the tax calculations of individuals, trusts and companies. 27 Mar 2018 Read more >> Cryptocurrency, and bitcoin in particular, has been a hot topic in the past few months, be it on the media, investors boasting about their profits, or curious parties wondering what the hype is all about. 29 Jan 2018 Read more >> Not all property owners are aware of the cashflow difficulties that can arise when they conclude an agreement of sale in one tax year but only receive the proceeds (usually on transfer of the property) in the following tax year. 27 Nov 2017 Read more >> We all want to ensure that our loved ones are not unnecessarily burdened with complications after our death. 31 Oct 2017 Read more >> As more and more South Africans are exploring employment opportunities beyond our country's borders, the issue of paying tax to the South African Revenue Service (‘SARS') on earnings from foreign employment becomes increasingly relevant. In this article we will examine what the current income tax legislation stipulates, how this is likely to change in the near future and what proactive steps expats can take to prepare their affairs. 29 Sep 2017 Read more >> In this article we will look at some practical issues worth considering with regard to extracting value from your business. My intention is not to consider any technical valuation models but rather to present some important considerations and food for thought for business owners. 28 Aug 2017 Read more >> In yet another apparent administrative blunder, we learned last week that Sars failed to update their systems to accommodate an interest increase which was gazetted on 29 April 2016. 4 Aug 2017 Read more >> Many business owners who are in the process of selling shares in their private companies or members' interest in their close corporations forget that, in addition to the normal income tax / capital gains tax implications to such sales, there is another tax which is also payable, viz. Securities Transfer Tax. 29 Jun 2017 Read more >> While starting a new role in a leadership position is certainly exciting, these types of positions come with their own fair share of overwhelming responsibility. Surrounded by instant pressure, taking on a leadership position can be a stressful exercise. However, it also provides an opportunity for individuals to prove themselves, as well as to showcase their talents and abilities. 29 May 2017 Read more >> April brought about ratings agencies Standard and Poor's (‘S&P') and Fitch downgrading South Africa's sovereign credit rating to “junk” or “non-investment grade speculative” status. The downgrading of credit ratings of South African banks followed in the wake. In recent weeks, the media has seen much prediction and speculation regarding the effect this will have on our economy and what can be done to remain afloat. 26 Apr 2017 Read more >> The aim of this article is to alert individuals to donations tax considerations over and above the utilisation of the full R100,000 annual exemption which will inevitably be used to a great degree now that section 7C has been introduced. 23 Mar 2017 Read more >> 28 February is the end of the tax year for all individuals, trusts and many companies and close corporations. As we approach the year end and have a good idea of our overall income and tax position for the year, now is the time to take some critical decisions. 10 Feb 2017 Read more >> Tax titbits - what does 2017 hold in store? 29 Nov 2016 Read more >> The Greek philosopher Heraclitus once famously said that "the only thing that is constant is change". In an economic environment of increasing uncertainty and change this rings especially true. Investors, owners and other stakeholders frequently find themselves considering the usefulness and reliability of information (such as the financial statements and audit report) presented to them and how this will be impacted by ever evolving requirements. Although a very broad topic of which we can barely scratch the surface in one article, we would like to spend some time on how the quality of the audit process behind locally issued audit reports compares to the rest of the world and what upcoming changes to audit reports our clients can expect in the near future. 28 Oct 2016 Read more >> Leading up to the Meredith Harington client seminar scheduled for 20 October 2016, I have summarised a few important considerations regarding cybercrime and information security. These are serious issues and, having recently attended a cybercrime seminar at Nedbank presented by Nicole Dunbar (Nedbank financial crime and forensic services) I am aware, more than ever before, of the risks we face on a daily basis as business owners and entrepreneurs. 3 Oct 2016 Read more >> We often get asked by clients whether they need to be a provisional taxpayer, whether they can be deregistered as a provisional taxpayer and how the payment of provisional tax works. We seek to answer these questions in our article below. 31 Aug 2016 Read more >> For a number of years the laws relating to the taxation of income earned by inter-vivos trusts have been under the spotlight. About three years ago a wide ranging set of changes were suggested by Treasury but eventually the talk fell subsided. Then in 2015, the Davis Commission issued its report, once again mooting significant changes to trust tax law. Yet again these proposals fell by the wayside. 29 Jul 2016 Read more >> At Meredith Harington, as a firm of professional accountants and auditors, we are well acquainted with the complexities of time management and understand the importance thereof in business. 29 Jun 2016 Read more >> The Minister of Finance announced a special voluntary disclosure programme (SVDP) in his 2016 Budget Speech to give an opportunity to non-compliant taxpayers to voluntarily disclose offshore assets and income. This will be a joint tax and exchange control process and will be open for a limited period from 1 October 2016 to 31 March 2017. The applications will be assessed through one joint process by both the South African Revenue Service (SARS) and the South African Reserve Bank (SARB). 30 May 2016 Read more >> Obtaining finance, whether it be for the purposes of working capital or for obtaining long term assets, is a challenge to most entrepreneurs and small business owners. One way to get finance is through the use of the equity in your home (alternatively the equity in your business premises). Both are usually appreciating assets, increasing in value as you work off your debt. 29 Apr 2016 Read more >> There are two aspects of value that I have discussed in this article: the value of employing a Chartered Accountant (SA) and the value in becoming a Chartered Accountant (SA). I will discuss these together and simply refer to CA (SA) for the remainder of this article. 31 Mar 2016 Read more >> Regulations to harmonise the tax treatment of retirement fund contributions are set to be introduced from 1 March 2016. 1 Feb 2016 Read more >> Certain South African tax residents are beneficiaries of trusts that are constituted and operated off-shore. When the South African taxpayer receives a distribution or award from this foreign trust, there are a number of important matters to consider in order to correctly disclose this receipt in your local tax return. There are even circumstances where you do not actually receive an award from the foreign trust but when the income of that trust must be declared in your South African tax return. This article looks at the matters that need to be considered in both sets of circumstances in order to ensure that you are making full and proper disclosure in your South African Tax return. 25 Nov 2015 Read more >> The International Financial Reporting Standard for Small and Medium-sized Entities (IFRS for SMEs) was issued in July 2009 by the International Accounting Standards Board (IASB). The vision behind this standard was to provide a less onerous reporting standard than the International Financial Reporting Standards ("full IFRS") being applied by most companies. Furthermore, the intention was to limit the number of continuing amendments to reporting standards which, in light of the numerous, constant and onerous amendments to full IFRS, was a much welcomed relief. 27 Oct 2015 Read more >> The Davis Tax Committee (DTC) is currently reviewing the role and continued relevance of estate duty to support a more equitable and progressive tax system. One of the areas receiving scrutiny is the exemption from estate duty of inter-spousal bequests. 25 Sep 2015 Read more >> In 2000 the Promotion of Access to Information Act (PAIA) came into law. Its intention was to fulfil the requirements of section 32 of the Constitution, which enshrined the right of access to information by both public and private bodies. Included in the definition of a private body is a partnership and private companies. This article concentrates on the obligations of private bodies, and in particular private companies. 1 Sep 2015 Read more >> In the auditing profession we have the privilege of experiencing a broad range of working environments, being our own (when at the office), and that of a broad range of clients. Spanning across a number of years we really get to see what works and what does not. 28 Jul 2015 Read more >> What is WTI?
It is a tax charged on interest paid from 1 March 2015 by any person to or for the benefit of a foreign person, which would include individuals, companies, trusts, etc., from a source within South Africa. The foreign person is responsible for the tax, but it must be withheld by the person making the interest payment to or for the benefit of the foreign person. Interest paid is taxed at a final withholding tax rate of 15%. 26 Jun 2015 Read more >>
In an effort to encourage savings by ordinary South African households, the Minister of Finance introduced the new concept of a "tax-free investment" which came into effect on 1 March 2015. In effect, investments administered by a regulated financial institution and authorised as a "tax-free investment" by the Minister will benefit from these new laws. The tax benefits are: 26 May 2015 Read more >> Every company is required by the Companies Act to keep accounting records and prepare annual financial statements (AFS). These are often seen as the "end product" to an audit, review or compilation assignment performed by the auditors or professional accountants. The question is whether owners and management view these financial statements as part of the company's essential records and decision making tools, or whether they are basically signed, filed and never looked at again. 29 Apr 2015 Read more >> Losing a valued staff member is never easy, especially considering the time and money invested in him/her over the years of employment. Finding a replacement might prove to be a very costly and tedious exercise. One thing is certain: the cost of hiring the wrong employee is substantially greater than the cost of following a decent recruiting process. 26 Mar 2015 Read more >> Business 101 - Profit is what's left over after you've paid all your expenses. It is a consequence of what happens in and to your business. Some of these things are within your control and some of them are not. 19 Feb 2015 Read more >> We live in a world, and for South Africa this is particularly prevalent, where the regulatory environment is extremely taxing (pun mostly intended). There are various technical aspects of the laws, regulations, codes and standards (regulations) that we could write volumes about, but consider from afar the effects of these regulations on companies in South Africa, the cost of not complying, potential internal issues and the opportunities presented. 25 Nov 2014 Read more >> Ensuring that the employees in your business are paid correctly, given the correct allowances and paid on time, every time has become a challenge for many businesses due to the ever-changing legislative landscape. 28 Oct 2014 Read more >> There are some fundamentals that are common to each and every business regardless of size, type or structure. One of the most important of these is the management of profitability and cash flow. It is critical to understand the difference between them and the fact that profitability and good cash flow do not necessarily coincide. Of course, eventually if the business is to survive, cash flow must be underpinned by profitability. 30 Sep 2014 Read more >> By now most of us have received an email that requires one to click on a link to update your banking details. Hopefully we are all aware that these are scams and that no South African bank will ask you to update any banking details via an email. 29 Aug 2014 Read more >> The 2014 tax season is now in full swing and individual taxpayers earning remuneration income in excess of R250,000 or earn other "non-salary" income (investments), need to submit a tax return to SARS for the year ended February 2014. 28 Jul 2014 Read more >> For most entrepreneurs, the business you have created has been the thing that has consumed most of your energy, ideas and being for as long as you can remember. It is also the creation that has built your wealth (and corresponding lifestyle) to date. It would therefore be a real shame if that business were not to continue in existence after your working life has finished. Surely you would prefer to leave the footprint of your successful business by ensuring a proper succession plan, be it to a member of family, management or some other party. And you get the chance to realise the capital value in your business as part of your retirement plan. 26 Jun 2014 Read more >> We all want to ensure that those we care about are taken care of once we pass on, and not create unnecessary complications. Why then do so many South Africans either have no will or have wills that are invalid? 28 May 2014 Read more >> Have you ever walked through a mall or down the street and been confronted with a new product that is exactly the same as yours and you had that "oh no, not another one" feeling? 2 May 2014 Read more >> According to online resources South Africa is the sixth most dangerous country in the world to live in. It is also no secret that we are challenged as a country with life-threatening diseases like HIV/AIDS, and probably one of the most underrated illnesses, obesity. Our roads are dangerous and it is also a fact that younger generations are these days confronted with cancer, high blood pressure and diabetes. Surely it makes sense to have proper life insurance if you have significant debt, or dependants totally reliant on you? 1 Apr 2014 Read more >> In their latest survey "Paying Taxes 2014" PwC and the World Bank rank South Africa highly overall for total tax rate, number of tax payments and tax compliance hours. While well ahead of Africa, and placed competitively worldwide, most South African entrepreneurs would consider they pay too much tax. And with the approaching National Health Service and significant infrastructure required to improve service delivery, there will be pressure on corporate and personal tax rates. Sin taxes and fuel levies are expected in some quarters to rise in 2014. 27 Feb 2014 Read more >> 28 February is the end of the tax year for all individuals, trusts and many companies and close corporations. As we approach the year end and have a good idea of our overall income and tax position for the year, now is the time to take some critical decisions. 6 Jan 2014 Read more >> It's the start of the New Year and no doubt, like many others, you have promised yourself that you would do a few things differently or a little better this year. So why not make a few New Year's resolutions about your business? 19 Dec 2013 Read more >> In business, your profits are your reward for your endeavors. In fact, profitability is the only reliable measurement of a business' success. Profits are the very lifeblood of a business. 14 Nov 2013 Read more >> Historically many directors of private companies have relied on others to ensure that their statutory responsibilities have been discharged. For example, many are unaware of legal responsibilities relating to consumer protection or labour legislation. 21 Aug 2013 Read more >> The Companies Act now allows companies having limited public interest to dispense with the annual audit for year ends after 1 May 2011. Should your company do so? 7 Apr 2012 Read more >>