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SARS auto-assessment vs provisional tax IRP6 for a courier, freight practice in Stellenbosch?

One of our partners in Stellenbosch still earns a salary while also billing courier, freight projects before we fold everything into the new company. How do we stop SARS auto-assessing the return before the business expenses are captured?

Candice October◆ 83asked 20 OctShown to 9 businesses that do this work

5 answers

  1. ✓ Accepted by the asker

    Mpho Chauke◆ 83Trusted voiceon Tax Services20 Oct
    To add to @karabo_phiri, make sure you keep a proper SARS-compliant logbook if any vehicle travel is claimed against that consulting income. Without opening and closing odometer readings and client trip reasons, SARS disallows travel claims automatically during verification.
  2. Karabo Phiri◆ 103Trusted voiceon Bookkeeping Services20 Oct
    @candice_october as soon as someone earns trade income outside of IRP5 remuneration, they qualify as a provisional taxpayer and should register for IRP6 on eFiling. Even if SARS issues an SMS auto-assessment in July, you do not have to accept it, you simply edit and file the full ITR12 with the business income and Section 11(a) deductions before the provisional deadline.
  3. Zola Mbeki◆ 68Trusted voiceon Tax Services20 Oct
    Solid advice from @karabo_phiri and @mpho_chauke. Also check whether moving that billing stream straight into your Stellenbosch (Pty) Ltd qualifies the company for the Small Business Corporation (SBC) progressive tax brackets under Section 12E.
  4. Vusi Khumalo◆ 48Contributoron Tax Services20 Oct
    @karabo_phiri and @candice_october we implemented this exact setup in Stellenbosch last quarter and it cut our monthly admin and reconciliation time in half.
  5. Candice October◆ 83Trusted voiceon Accounting20 Oct
    Appreciate the clarity @karabo_phiri and @mpho_chauke. We are logging the opening odometer readings today and folding the contracts into the company next month.

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