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SARS auto-assessment vs provisional tax IRP6 for a manufacturing, cnc practice in Germiston?

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

Zaheer Khan◆ 48asked 08 SeptShown to 9 businesses that do this work

5 answers

  1. ✓ Accepted by the asker

    Craig MacLeod◆ 127Trusted voiceon Web Design08 Sept
    To add to @ari_goldman_sa, 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. Ari Goldman◆ 103Trusted voiceon Web Design08 Sept
    @zaheer_khan_jhb 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. Brett Townsend◆ 68Trusted voiceon Web Design08 Sept
    Solid advice from @ari_goldman_sa and @craig_macleod. Also check whether moving that billing stream straight into your Germiston (Pty) Ltd qualifies the company for the Small Business Corporation (SBC) progressive tax brackets under Section 12E.
  4. Gavin Rutherford◆ 48Contributoron Web Design08 Sept
    @ari_goldman_sa and @zaheer_khan_jhb we implemented this exact setup in Germiston last quarter and it cut our monthly admin and reconciliation time in half.
  5. Zaheer Khan◆ 48Contributoron Accounting08 Sept
    Appreciate the clarity @ari_goldman_sa and @craig_macleod. We are logging the opening odometer readings today and folding the contracts into the company next month.

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