Companies and Close Corporations

  • Accounting Services:

    • Monthly Account Management

      The process of preparing management reports and accounts that provide accurate and timely financial and statistical information required by managers to make day-to-day and short-term decisions. Unlike financial accounting, which produces annual reports mainly for external stakeholders, management accounting generates monthly or weekly reports for an organization’s internal audiences such as department managers and the chief executive officer. These reports typically show the amount of available cash, revenue generated, amount of orders in hand, state of accounts payable and accounts receivable, outstanding debts, raw material and inventory, and may also include trend charts, variance analysis, and other statistics.

    • Statutory Returns
      • VAT Returns
        Once the business is registered for VAT, it is obliged to perform certain duties and take on certain responsibilities, for example, it is required to-
        • include VAT in all prices advertised or quoted;
        • charge and collect VAT;
        • submit returns and payments on time;
        • issue tax invoices for supplies made;
        • maintain adequate records for supplies made and received;
      • PAYE, UIF & SDL Returns
        The Monthly Employer Declaration (EMP201) and payment process provides employers with an easier and more effective means to manage their Pay-As-You-Earn (PAYE), Skills Development Levy (SDL), and Unemployment Insurance Fund (UIF) accounts.
      • EMP501 Returns
        The Employer Reconciliation process requires an employer to submit an accurate Employer Reconciliation Declaration (EMP501), and if applicable, Tax Certificate Cancellation Declaration (EMP601) and Reconciliation Declaration Adjustment (EMP701) to the South African Revenue Service (SARS).

      The three elements that must reconcile in order for your reconciliation submission to be successful are the:
      • Monthly Employer Declarations (EMP201s) submitted
      • Payments made
      • Employee Tax Certificates [IRP5/IT3(a)s] generated.

    • Audits

      An examination and verification of a company’s financial and accounting records and supporting documents by a professional, such as a Charted Accountant.

    • Provisional Tax Returns

      Companies automatically fall into the provisional tax system. The amount of tax payable is determined on the estimated taxable income for that particular year of assessment, as follows:

      • The First Period:
        o Half of the total estimated tax for the full year;
        o Less the employees tax deducted for this period (6 months);
        o Less any allowable foreign tax credits for this period (6 months).
      • The Second Period:
        o The total estimated tax for the full year;
        o Less the employees tax paid for the full year;
        o Less any allowable foreign tax credits for the full year;
        o Less the amount paid for the first period.
      • The Third Period (voluntary):
        o The total tax estimated payable for the full year;
        o Less the employees tax paid for the full year;
        o Less any allowable foreign tax credits for the full year;
        o Less the amount paid for the 1st and 2nd provisional tax periods.
    • Income Tax Returns

      Corporate Income Tax (CIT), also known as a business tax, is a tax imposed on businesses incorporated under the laws of the Republic of South Africa and which derive income from within the Republic or through a branch or permanent establishment within the Republic.

  • Black Economic Empowerment BEE Verifications

    is a programme launched by the South African government to redress the inequalities of Apartheid by giving previously disadvantaged groups (black Africans, Coloureds, Indians and some Chinese) of South African citizens economic privileges previously not available to them. It includes measures such as Employment Preference, skills development, ownership, management, socioeconomic development, and preferential procurement.
    The rating will assist companies in identifying and understanding their own, unique empowerment status, risks and opportunities. Empowerment ratings can also be used by public and private sector institutions and companies to allocate procurement, licensing and financing benefits more efficiently and effectively thus benefiting sustainable empowerment entities.

    Public Ratings
    • A public rating evaluates the BEE status of companies based on:
    • Direct Empowerment (Ownership and Management Control),
    • Human Resources Development (Employment Equity and Skills Development),
    • Indirect Empowerment (Preferential Procurement, Enterprise Development and Social-Economic Development)
    • Operational capacity

    Ratings provide procurement officers, financiers and licensing organizations with an independent assessment of the BEE status of a potential beneficiary. An SMME rating provides information on the direct empowerment status of the entity being rated, as well as an assessment of its operational capacity.

  • HR

    • Payroll Administration

      Payroll administration encompasses all the tasks involved in paying an organization’s employees. It involves keeping track of hours worked and ensuring that employees receive the appropriate amount of pay. It also includes calculating taxes, as well as ensuring that they are properly withheld and processed. Depending on the company in question, a full range of other deductions may be calculated, withheld, and processed as part of this process.

    • Payslips, monthly weekly payroll processing

      Supplying payslips either on a monthly or weekly basis.

  • Secretarial

    • Annual Returns

      All registered business must file its Annual Return within twenty (20) business days, after its incorporation anniversary date.

    • Amendments to CK and COr14.3 statements

      Changes made to the business original founding statement.

    • Conversions of Close Corporations to Proprietary Limited

      It is no longer possible to register a new close corporation or CC. However, you can carry on trading under a CC that existed before 1 May 2011. But CC’s will slowly become extinct and every CC will (at some point) have to be converted into a private company ‘(Pty) Ltd’. Many people chose a CC and still prefer a CC because a CC gave them the advantages of incorporation, with lower costs and simpler administration. Virtually all the advantages that a CC had, can now also be obtained by having a private company under the new Companies Act. For example:

      • the annual return fee is the same regardless of whether you have a CC or company
      • small private companies do not need to be audited or produce audited financial statements
      • small private companies do not need to convene an annual general meeting (AGM)—Some argue that there are actually more advantages to being a private company rather than a CC.
      • Compete with bigger companies in the same market.—Invite other parties to invest as shareholders in your business.
      • Raise more capital to grow your company.
      • Enable companies and CCs to be shareholders in your business.
      • Benefit by being regulated by a law (the new Companies Act) that is up-to-date with international best practice.
      • Administer your company electronically.
      • Ensure that the rights, duties and responsibilities of members are clearly set out.
      • Avoid disputes between members.
  • Workmen’s Compensation Fund

    • Letters of Good standing

      All employers must register with the Compensation Fund and pay an annual assessment fee based on their workers’ earnings and the risks associated with the type of work being done. Employers who give work to contractors must obtain a letter of good standing from the contractor to prove that the contractor is registered and that assessment payments are up to date.

    • Return of Earnings

      Before 31 March each year, all employers (including contractors) must submit a statement of earnings paid to all their workers from the beginning of March to the end of February. The annual assessment fee is calculated on workers’ earnings and an assessment tariff based on the risks associated with the type of work being done

  • SARS Registrations for:

    • Income Tax

      CIT is applicable (but not limited) to the following businesses which are liable under the Income Tax Act, 1962 for the payment of tax on all income received by or accrued to them within a financial year:

      • Listed public companies
      • Unlisted public companies
      • Private Companies
      • Close Corporations
      • Co-operatives
      • Collective Investment Schemes
      • Small Business Corporation (s12E)
      • Body Corporates
      • Share Block Companies
      • Dormant Companies
      • Public Benefit Companies

      Every business liable to taxation, under the Income Tax Act, 1962, is required to register with SARS as a taxpayer.

    • Provisional Tax

      Companies automatically fall into the provisional tax system. Registered automatically when registering for Income Tax.

    • PAYE, UIF and SDL

      According to law, an employer must apply for registration with the South African Revenue Service (SARS) within 21 days after becoming an employer, unless none of the employees are liable for normal tax.

    • VAT

      VAT is an abbreviation for value-added tax. It is an indirect tax on the consumption of goods and services in the economy. Revenue is raised for government by requiring certain businesses to register and to charge VAT on the supply of goods and services. These businesses become vendors that act as the agent for government in collecting the VAT.It is mandatory for a business that earned income, in excess of R1 million in any consecutive twelve month period to register for VAT. A business may also choose to register voluntarily if the income earned, in the past twelve month period, exceeded R50 000.

    • Import and Export

      In order for traders to conduct business with SARS, they need to be registered. This includes the following:

      • Local Importer;
        All local persons who import (bring goods into) the Republic must register as an importer with Customs.
      • Local Exporter;
        All local persons who export (take goods out) of the Republic must register as an exporter with Customs.
      • Foreign Importer;
        All foreigners who import goods into the Republic must register as an importer with Customs and appoint a local registered agent to act on their behalf.
      • Foreign Exporter;
        All foreigners who export goods from the Republic must register as an exporter with Customs and appoint a local registered agent to act on their behalf.
      • Rebate User;
        Clients who register as rebate users are allowed to import goods without paying duties under certain conditions, i.e. for processing, manufacturing, and packaging with an intention of exporting them.
      • Manufacturer in terms of drawback;
        All local persons who import goods into South Africa should register if they wish to apply for a drawback (refund) after exporting goods on which duties were already paid. This applies to imported goods used in manufacturing of goods which are subsequently exported.
      • MIDP (Motor industry development programme);
        MIDP is an incentive programme for components imported under rebate item 317.04, 317.07 (light motor vehicle manufacturers) and 317.06 (component manufacturers) for home consumption. Anyone who imports components for use in terms of such provisions should register for MIDP for them to qualify for an incentive.
      • EDI (Electronic Data Interchange);
        SARS is legally mandated to enforce the use of Electronic Data Interchange for the submission of certain cargo and goods declarations and reports. Everyone doing business with SARS should register for EDI.
      • Automated Cargo Management System (ACM);
        SARS requires, in line with international practices, that cargo be reported to it prior to arrival for the purposes of screening and risk assessment. This is done electronically via SARS’s ACM system. It is mandatory for all cargo reporters submitting the following reports to be registered with SARS for ACM: Vessel schedules; Vessel arrivals; Manifests and Outturn reports.
      • Registered Agent;
        A registered agent is a person located in South Africa who has/is nominated to act as an agent of a foreign trader. They need to firstly register with SARS.
      • IDZ (Industrial Development Zone);
        An IDZ offers facilities for manufacturing, storage and distribution of goods in an area adjacent to an international harbour or airport, as designated by the Minister of Trade and Industry. Anyone who operates an IDZ must register with Customs.
      • Accreditation;
        Accreditation is an advanced programme which seeks to establish a partnership between SARS and compliant clients. Clients need to apply to be part of SARS’s accreditation programme.
  • Department of Labour Registrations for:

    • UIF Contribution
  • Workmen’s Compensation Registration