TIPS FOR MARCH FROM OUR EXPERTS AT NORTHBOUND

by | Apr 3, 2023 | Tips from Northbound | 0 comments

THE NEW FINANCIAL YEAR

By Cavel Koert | SAIPA

Key Relationship Manager

Cavel has a National Higher Certificate and National Diploma in Accounting and a BTech in Internal Auditing. She is also part of SAIPA.

We are officially now in the 2024 financial year, there will be a few changes and some requirements to ensure that the year runs as smooth as possible and that we can meet all required deadlines.

While some clients have already received a communication that we will be allocating some bookkeeping clients from Ramona to Dewald and Mirriam, we would like to ensure clients that Ramona is still with us and will be assisting to ensure that you as the client still receive the best service. We just had to do a few strategic changes to ensure that we can provide the best services to all of our clients.

We have also sent out a communication to clients regarding when the 2023 financials will compiled and by when the information is needed. If you need your financials sooner, please don’t hesitate to contact me and I will reschedule the date for you.

DE-REGISTRATION OF ENTITY TAX TYPES WITH SARS

By Laverne Geswint | GTP – (SA) SAIT

General Tax Practitioner South Africa

Laverne has more than 18 years experience as a tax practitioner with a BCOMPT in Accounting Science, majoring in Taxation (UNISA). She also has a Postgraduate Diploma in Taxation (UNISA) and is part of SAIT.

When a company, close corporation or trust stops trading and ceases to operate, it needs to de-register the business with SARS.

SARS requires formal, written notification (proof) along with all relevant supporting documents in order to de-register the entity. The entity also needs to be tax compliant with SARS before they will consider de-registering the entity.

For companies and close corporations, the first step is to de-register the entity with the Companies And Intellectual Property Commission (CIPC). This process with CIPC can take up to 6 months.

Once de-registered, CIPC issues a final notice of de-registration for the company or close corporation.

For trusts, the Master of the High Court needs to be notified that the trust needs to be de-registered.

Once the trust is de-registered with the Master, we receive the final notice of de-registration in the form of a letter.

This CIPC / Master final notice of de-registration, along with all relevant supporting documents are then submitted to SARS and we formally request that the company, close corporation, or trust be de-registered.

For PAYE and VAT de-registrations, CIPC or the Master does not need to be notified of de-registration. An EMP123 for payroll taxes or aVAT123 form for Value Added Tax just needs to be completed and signed. We attend to the other relevant supporting documents which accompany this EMP123 or VAT123 from to SARS.

This de-registration process with SARS can take up to 2 years (24 months) to be finalised.

In the meantime, all nil tax returns (Income Tax, VAT, PAYE, provisional tax returns) must be submitted to SARS so the entity remains tax compliant otherwise SARS will refuse to de-register the entity.

We will then have to submit any nil tax returns to get the entity tax compliant and re-start the whole process from the beginning.

Once de-registered, SARS will notify us in writing that all tax obligations as at the date of de-registration, which is the date of the SARS letter, has been met and no further tax returns need to be submitted to SARS.

TIPS TO START OF THE 2024 TAX YEAR

By Cornel Gouws | CA (SA)

Key Relationship Manager

Cornel has a B Com (Rationum) in Accounting & Business Management and a B Com ( Hons) in Accounting. He is also part of CA (SA) and SAICA.

  1. Organisation is key

If you are an employee or a business owner, accurate record-keeping is essential. This includes medical expenses, retirement contributions, kilometers travelled for work purposes (by using a logbook), business expenses, home office expenses, tax certificates (IT3 certificates), and disposal of any assets. It will make it easier for you to claim allowable deductions against your income on your tax return.

  1. Saving smart

Contributing a maximum amount of R36 000 during the 2024 tax year of assessment to a tax-free savings account. This is limited to a maximum lifetime contribution of R500 000. One could open a tax-free savings account for yourself, your children, and grandchildren in each of their names.

Contributing to a retirement annuity. The tax deduction is limited to 27.5% of the higher of your taxable income or remuneration, capped at R350 000 per tax year.

  1. Property

If you are in the market for your first property that you will use exclusively as your primary residence, you qualify for a R2 million rebate on the capital gains realised when selling this primary residence.

If you own property that generates rental income, it is important to keep records of the cost incurred to maintain the property. You can claim these costs as deductions.

  1. Solar Energy

Households are encouraged to invest in clean electricity generation capacity which can supplement the electricity supply. As a result, if you pay personal income tax you can claim a rebate to the value of 25% of the cost of new and unused solar panels, up to a maximum of R15 000.

Businesses will qualify for a 125% tax deduction on qualifying investment costs for a 2-year window period. There will be no limit to the qualifying cost of such investments. This means that businesses will qualify for a cost plus 25% allowance on the cost incurred on renewable projects in the year it was incurred.