THUNDERLION

business SOLUTIONS

 

Budget 2010/2011

Company tax

 

Company tax rate - 28% of net income

 

Small business corporations

 

These are companies who have a turnover of less than R14 million per annum, and who’s members or shareholder do not own shares in any other private company or membership in any other CC.

 

Also not more than 20% of the gross income should  be from investment income or personal service income.

 

Qualifying companies get taxed at a preferential rate as follows:

 

Taxable income                       Rates of tax

R 0 - R 57 000                        Nil

R 57 001 - R300 000               10% of the amount over R 57 000

R300 001 +                           R24 300 + 28% of the amount over R300 000

 

Turnover tax - Micro enterprise

 

This is an elective tax system for businesses that have a turnover of less than R1 million per annum. If the business elects to be taxed in this way it must remain in the system for at least 3 years, as long as the turnover remains below the threshold. Personal and professional services are excluded from this system.

 

Turnover tax rates are as follows:

 

 

R 0 - R100 000                        Nil

R100 001 - R300 000               1% of the amount over R 100 000

R300 001 - R500 000               R 2 000 + 3% of the amount over R 300 000

R500 001 - R750 000               R 8 000 + 5% of the amount over R 500 000

R750 001 - R1 000 000             R 20 500 + 7% of the amount over R 750 000

 

Vat registration

 

A business is required to register as a VAT vendor, when their turnover is likely to exceed R1 million per annum. A vendor may however register voluntarily, as long as the turnover is greater than R50 000 for 12 months