This is an excerpt from a letter sent to all Allen Payroll, Accounting & Tax bookkeeping clients on 24/03/2020
Like most of the nation I followed along carefully with the President's announcement last night regarding the coming restrictions on movement that will be taking effect on Thursday night. I'm sure many of us are concerned about how this will affect our own businesses. This email's purpose is to tell you: Don't Panic, help is available!
Let's take comfort in the fact that South Africa is taking this virus' affects on the economy very seriously and has put into place help for those who need it the most. While in lockdown don't consider this the end of your business, rather, consider it the beginning. Your business can emerge from this disaster stronger than it went in. How can this be done? Well, remember all that planning and strategy that you have been putting off in favour of doing doing doing? Now is the time to dust those strategies off and start thinking about what your business will look like in the post Corona era. What is your Big Hairy Audacious Goal (as they say in economic theory)? Then break that big goal down into smaller, manageable chunks. Maybe consider how you could shift your thinking to leverage technology more. Especially to continue doing business now while at home. Think about how you could be more efficient, doing more with less.
If nothing else, this emergency has brought home to all of us how important it is to have an emergency fund for our business! Best practice states that each business, no matter how big or small, should have enough money to cover running costs for 2-3 months stashed away. This should be in a savings vehicle that is difficult to touch, a war chest that is only broken out in the case of true emergencies. Perhaps you could make a pact with yourself that after this difficult time period you pledge to contribute 5%-10% of your monthly turnover to this war chest in future.
What about now?
In his address last night the president announced a number of measures that government is putting into place to specifically help small and medium businesses through this trying time. Among these were:
As Allen Payroll, Accounting & Tax, we have always taken advantage of technology and have been working from home offices since we started, so our services to you will continue as they always have, uninterrupted. We are committed to helping your business through this turbulent, history making event. Therefore, as soon as we have clarity from the various institutions on just how to make use of these measures we will be putting together a second information email with those details. We will also assist our clients, free of charge, to apply for these relief measures and guide you through the entire process.
Make no mistake, now is the time to buckle down, strategise, keep calm and emerge on the other side a stronger, smarter, leaner business.
Allen Payroll, Accounting & Tax
Did you know that Sole Proprietors and Partnerships are among the oldest forms of business on earth? The draw of this form has attracted people since the first smith hung his sign outside his shop in medieval England or the first African started breeding cattle on the savanna. The reason for this is its simplicity to set up and run. In short, the Sole Proprietor or Sole Trader or Partner IS the business and the business IS them. You cannot separate the two. They are the multiple personalities of the business world. This form of business has various pros and cons, which a short Google search would unearth for you, so we won’t rehash these. We will focus solely on the tax implications and how we can help you navigate these pitfalls.
Some people qualify as provisional taxpayers, but a lot don’t know what that means or what provisional tax is. So, in this article I will try to clear up some of the smoke surrounding this often-misunderstood and feared tax.
Firstly, provisional tax is not a separate type of tax, such as VAT or the road tax you pay through your very expensive fuel bill. Provisional tax is merely a method that SARS uses to collect income tax, whether it be company tax or personal income tax. For individuals it uses the same tables and rates as you would be taxed on if you were a straight forward employee and counts towards the same tax bill as an employee pays through the PAYE that is shown on their payslip. The big difference is when and how this tax is calculated and paid to SARS. Employees pay their tax every month, provisional payers pay it twice a year before the 31st August and 28th February. For companies it uses the straight forward 28% tax rate or the small business tax tables.
I do a lot of tax returns every year and this has to be one of the most common complaints I receive. Every year without fail I get clients who compare this year with last and then go to SARS only to be told the exact same result as I told them. So, I thought it would be a good idea to examine why this phenomenon occurs.
Hello everybody, since this is my first post on this brand new blog I thought I would kick off with a topic that I get asked about on quite a regular basis: what do I need to know when I start a new business?
So you've had your brilliant idea and now you want to put it into practice. You start working at it and the idea takes off, orders start coming in, You're so busy you wish you had 30 hour days to get everything done. Is this success? Well, not really. Suddenly you realise your business is rolling along but cash flow is now becoming difficult, SARS is knocking at the door and your excel spreadsheets are growing out of hand.
Author: Brandon Allen
I'm a business Accountant in practice. Nothing fancy about me, but occasionally I have a flash of inspiration you might find useful. My blood is also 50% coffee.
Note that no information in these posts constitutes official advise, please contact us with your specific needs.