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Provisional Tax and Your Small Business

by Magdalene van der Walt on Feb 4, 2020

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What is provisional tax? Provisional tax is a method created by SARS to help relieve the pressure of making one large payment at …

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Small Business

Understanding Your Financial Statements

by Magdalene van der Walt on Nov 21, 2018

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The Importance of financial statements. In my experience as an Accountant for over 10 years, I’ve found that my clients have had one …

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Small Business

How The Vat Increase Affects Small Business

by Magdalene van der Walt on Jun 6, 2018

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South Africa, 1 April 2018. The day South Africa effected is first vat increase in 25 years. While percentage wise, the 14% …

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Small Business

How To Write A Business Plan

by Magdalene van der Walt on Dec 22, 2017

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A goal without a plan is just a wish. As Entrepreneurs and Business Owners, we often birth amazing ideas that we’re …

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Self Improvement Small Business

How To Become More Successful

by Magdalene van der Walt on Oct 30, 2017

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Have you ever wondered why success seems to escape you? You’re putting in ridiculously long hours, are checking the items off your …

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Small Business

Simple Tips To Help Boost Your Productivity

by Magdalene van der Walt on Oct 25, 2017

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If you’re struggling to maximise your productivity in business – Read this. In this blog post, we’re going to unpack a powerful …

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Small Business

Create A Business You’re Madly In-Love With

by Magdalene van der Walt on Oct 24, 2017

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Do you often long to create a business you’re madly in-love with, but you just don’t know what is right for you, …

I'm sure you've seen the word ASSETS referred to in accounting. These are the possessions of the business that will bring it benefits in the future. In other words, it’s everything owned by the business that will contribute in some way to it making money. Some examples of assets include your customer accounts, vehicles, bank accounts and investments.⁠
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This category is found in your Balance Sheet - a financial statement of a business which includes assets, liabilities, and equity capital.⁠
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In my experience as an Accountant for over 11 years, I’ve found that my clients have had one universal issue - understanding their Financial Statements. I am going to be doing a series on social that I hope will demystify a bit of the accounting jargon and assist small business owners understand their reports a bit better. ⁠
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This is from our blog, so if you can't wait until the next instalment, head over to the post to read the full article: Linkin.bio 🌠⁠
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Client testimonials make it all worthwhile. ⁠
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Some are older, but still gold like this one from Johann Olivier!⁠
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We've been serving small business since 2015, and don't intend on packing away our calculators any time soon 💫⁠
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Find out more about us. Linki.bio ⁠
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With the commencement date of the Protection of Personal Information Act 4 of 2013 (POPI) of 1 July 2021 fast approaching, businesses should be reviewing their use of personal information to determine if it complies with the Act. It is important to understand that any business that has employees, customers and suppliers must comply with POPI when dealing with personal information. ⁠
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SAIBA offer a few tips on ways businesses can kick-start their compliance exercise. Linkin.bio 💫⁠
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Never stop learning. It's impossible to know it all. We live in an ever-changing world. ⁠
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As an entrepreneur, you should continuously pursue knowledge and skills. Continued learning provides room for new opportunities, ideas and improvement in your business.⁠
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Learning doesn't have to come in course material. Find a mentor, join a mastermind class, read a book/ blogpost, or hire smart people who you can learn from, whatever works best for you. Just don't stop learning and growing. Your future self will thank you for it!⁠
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Having the courage to not only think for yourself without following popular opinion blindly, but also voice those thoughts, may not be met so fondly. ⁠
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To quote Thought Catalogue, "Thinking for one’s self is probably the greatest amount of continuous grunt work any person can ever achieve...But it is also exemplary in a world where popular opinion is often the decider for what is right and wrong."⁠
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Small businesses are really spoilt for choice when it comes to good accounting software. Setting your accounting software up properly can get complicated. It can be difficult, if you aren't versed in this area, to know which accounts you will need to create, how to create products and services listings for invoicing purposes, as well as setting up customer and supplier accounts with the proper terms and required information.⁠
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Hire a professional to customise your system and set up your information correctly. Don't be shy to ask them how to perform any changes to the system once they have completed so that you are able to do it yourself going forward. Once your system is complete, data capture and invoicing will be much easier.⁠
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As certified Sage Business Cloud and Xero Advisors, if you're experiencing any issues with your cloud accounting system, DM us and I'm sure we'll be able to get you on track!⁠
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If you're looking to supplement your income, a virtual administration business is a great, low cost way to do this.

While it does not require large startup costs, it does however, require computer literacy and administration skills, basic office equipment, and a sprinkle of patience while you build up your client base.

Some of the items we’ll cover in the eBook:

✅ Getting started: What you need to do before you open for business.

✅ Getting paid: How to set up your pricing structure.

✅ Taxes: Your tax responsibilities as a freelance professional.

✅ Tips & Templates: Additional tips and advert templates to attract your ideal client.

Find this practical guide here:
http://thebusybookkeeper.co.za/wp/product/start-a-home-based-business/

Most employers and employees in South Africa greeted last month’s Budget Speech with a sense of relief. Against all odds, government managed to provide for a large scale COVID-19 vaccination campaign without needing to introduce significant new tax increases. Indeed, the Budget avoids increasing the tax burden by withdrawing the R40 billion tax measures previously announced.⁠
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The above-inflation personal tax relief is especially welcome to struggling households. That’s not to say we’re out of the woods yet – debt levels are high and much depends on whether government can hold the line against public-sector unions’ demands for above-inflation wage hikes.⁠
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Read more for seven things to note as we move into a new tax year: Linkin.bio⁠
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I think that the most powerful tool that an entrepreneur can have, is to Believe in Themselves.⁠
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Entrepreneurship can be a lonely journey. You may be tempted to seek approval, acceptance or validation from other people. These often well-meaning people may try impose their level of perception on to your journey and cause you to doubt yourself and even give up during difficult times. ⁠
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Learning to Believe in Yourself is key to developing the confidence and commitment that you need to overcome failures and difficult times in business, and in life.⁠
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If you're not putting in the effort, how can you be disappointed if you don't see the results?⁠
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Owners (directors/ members) of companies/ close corporations should be paying themselves a salary and running it through payroll every month, as you would for an employee.⁠
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If you are a self-employed freelancer or sole-proprietor, you may too pay yourself a "salary" of sorts. It won't be considered a payroll expense as there is no legal separation between you and the business, but it will be classified as "owner's drawings".⁠
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As you would have learnt from me in previous posts, you should be keeping your personal and business expenses separate. Paying yourself a salary further reinforces this and removes the need for the business to settle all your personal expenses throughout the month.⁠
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In South Africa, there is currently R249.5 billion worth of late payments owed to small businesses. This dizzying amount is not only impacting cash flow for many firms but could also threaten the survival of many of them beyond the coronavirus (COVID-19) pandemic.⁠
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Research shows coronavirus lockdowns imposed by the government have also significantly impacted late payments, having almost doubled compared to 2019.⁠
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Keeping late payments to a minimum could reduce the number of bankruptcies and subsequent level of unemployment from rising.⁠
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While several large South African companies pledged to pay small -to-medium-businesses (SMEs) faster, the issue of late payments still looms large.⁠
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So what can businesses do to work with their clients and customers to ensure timely payments are being made in full?⁠
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Read more: Linkin.bio⁠
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As a busy female entrepreneur and homeschooling mother, I have learnt that there is no shame in asking for help. I have wasted hours by doing trivial things that ate up time and energy that I could have better focused elsewhere.⁠
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There was a measure of fear initially, when I first decided that I needed to hire. If you're not at the stage in business where you can hire full-time, outsource. By doing this, if the individual is not performing, you can simply replace them with someone new.⁠
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There is always a degree of risk involved when you take someone new on board and trust them with your professional reputation, but the benefits far outweigh them!
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As a small business owner, there will be times when you pay for business expenses with personal funds. In circumstances like this, the business should reimburse you for each purchase made on its behalf. There has to be structure with these reimbursements or your bookkeeping will be in a shambles. ⁠
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Firstly, keep the invoice/ cash register receipt as proof of purchase. The business will reimburse you an exact amount, so an audit trail is important. Next I would recommend keeping a spreadsheet of the expenses. Include columns for date, document number, supplier purchased from, purpose of purchase, and document total. While this may seem like a bit of a hassle, it will save time for both you and your bookkeeper. Lastly, hand a pdf export/ printout of the purchases, along with the invoices/ receipts, for payment processing. ⁠
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I would recommend a monthly reimbursement be paid to you for the collective total of your spreadsheet at month end. It is more time-efficient to process one payment, rather than smaller payments as they come in. ⁠

⁠It's also a good idea to let the
person responsible for reimbursing you know to keep this payment separate from your monthly salary. ⁠
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A “flat tax” is not a new idea. It has been used in history with far greater success than the current progressive tax system that penalises those who are more productive, by taxing them more. A flat tax encourages saving, and therefore investment, which in turn fuels economic growth⁠
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Siphamandla Mkhwanazi, economist at FNB, speaking at a Budget Trilogy Event recently pointed out that no country has ever taxed its way to a higher growth rate. ⁠
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Read more here: https://accountingweekly.com/saibas-view-on-the-budget-lets-move-to-a-flat-tax/⁠

Last year was brutal. In our practice, I saw many small businesses who were already teetering on the edge of financial disaster, nearly collapse. Many are still feeling the effects of 2020 and feel absolutely hopeless, despite their best efforts to bring in business and keep their doors open.⁠
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I see you. Your hard work and determination are both courageous and commendable.⁠
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Tomorrow brings new opportunities. Don't give up.⁠
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#thebusybookkeeper #businesssavvy #businessadvice #businessadvicedaily #smallbusiness #accounting #tax #accountants #goodbusiness #durban #southafrica #fempreneur #femaleentrepreneur #womeninbusiness #finance #sagebusinesscloud #sage #xero #cloudaccounting #cloudaccountingadvisors #businesswomenofinstagram

I know that as a small business owner, you may wear many hats. ⁠
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Your focus, should you be assuming responsibility for admin and operations, will more than likely prioritise operations as that is what brings in the cash flow. ⁠
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I recommend setting aside at least 30 minutes to an hour per week just to catch up on your accounting, perform a payment run or review your account balances (bank, customer/ supplier ageing etc.).⁠
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Making this a regular task will empower you with up-to-date financial information, making you more in control of your business.⁠
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The feeble SA economy is expected to grow 3.3% this year, then fall to 2.2% in 2022 and 1.6% in 2023.⁠
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Compare this with the major economies of the world: the US is expecting average growth of 2.6% a year for the next five years; the EU expects growth of 3.7% in 2021 and 3.9% in 2022.⁠
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China expects to grow 8.1% in 2021 and 5.6% in 2022.⁠
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Global growth is set to rise by 5.5% in 2021 and 4.2% in 2022.⁠
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SA is falling further and further away from any ability to revive the economy (outside of a serendipitous recovery in the mining sector, which rescued our balance of payments in 2020).⁠
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This latest budget seems directionless and somewhat desperate.⁠
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To read more:
https://accountingweekly.com/the-problem-with-this-budget-theres-no-real-growth-plan

I personally struggle with perfectionism. While this is a great for accounting, in other areas of business it is literally a recipe for disaster as I can be scrapping and re-doing items that were great to begin with, wasting many hours of my life per project. It also causes me to be reluctant to pass on tasks that I shouldn't be doing at my level in the company because I fear others "won't do it right".⁠
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Does anyone else struggle with the same issues?⁠
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Money and budget tips you can't ignore as a small business owner 💰⁠
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🌠 Plan for large purchases carefully and ahead of time. Obviously you won’t be able to predict items such as a vehicle needing urgent repairs. I'm referring to purchases such as planned upgrades. Think equipment, software, office etc. Plan and save for these.⁠
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🌠 Overestimate your expenses. No 2 projects are the same so you cannot base one project's expenses 100% on a previous project's expenses. Overestimate as it's probable that there will be nasty little expenses that weren't provided for. ⁠
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🌠 Pay attention to your sales cycle. Budget for these "off-season" months. If lockdown taught us anything, it's that expenses don't take a holiday because your business is having a quiet month. Use these quiet months to plan for your next sales boom cycle.⁠
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🌠 Time is money. Remember to incorporate your time into a budget. Timing underestimation will increase costs and therefore minimise the project’s profit.⁠
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🌠 Define and understand your risks. Risks could potentially have a negative impact on the financial health of your business. Map out potential threats for better planning.⁠
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🌠 Your budget will never be constant. Always revisit it to ensure you know what you can afford and when you can afford it.⁠
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Working from home has resulted in an increase in the use of digital platforms and is now an integral part of our day-to-day lives which we refer to as the ‘new normal’. Commonly used platforms are Zoom, Microsoft and Google. Users are focused on getting the job done and seldom focus on cybersecurity while engaging on these platforms.⁠
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Hackers are lurking in the increasing popularity of these platforms and are taking advantage of the vulnerable untrained user. The good news is that these platforms contain several security features that help combat cybersecurity threats, but the bad news is that end-users are not trained in understanding these settings. Cybercriminals continue to use the COVID-19 pandemic to their advantage and working in a secure environment is of utmost importance.⁠
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Read about more about the most common threats, and the measure to take to mitigate these below: ⁠
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https://www.icba.org.za/cybersecurity-awareness-when-using-digital-platforms/⁠
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Linkin.bio: IronTree offer excellent solutions. Claim free trials on some of their offerings. ⁠
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Are you recording cash transactions? If you aren't, it can really mess with your business's bookkeeping.⁠
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When receiving money on customer invoices in cash, it can be tempting to take this money and spend it on supplies for the business, but this should not be your first step. ⁠
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I implore you, please record the receipt against the customer first as you may forget who you received the money from later on. ⁠
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Secondly, if you're purchasing supplies in cash, ensure that you keep the invoices/ till slips of the purchases so that you can account for those expenses. If you don't account for every expense in your business, your profits will be inflated. This means that you will pay tax on a profit figure that isn't accurate = more tax payable.⁠
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If you're not using a good cloud-accounting system such as Sage Business Cloud or Xero, account for your cash receipts and payments by capturing them on Excel or Google Sheets. This is a good way to ensure that you have record of all your cash movements.⁠
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We're Sage Business Cloud and Xero Advisors. If you're wanting to make the switch, we can help set up your systems. DM us! ⁠
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Sage Business Cloud are offering a free 30 day trial. Linkin.bio.

While the country was under lockdown, it appears SARS and National Treasury have been hard at work, using this time to refine the law in SARS’ favour. These changes do not refer to the Covid-19 tax relief changes but are aimed at closing tax loopholes and to simply give SARS and the National Prosecuting Authority more teeth. Ask your accountant or tax advisor to help you understand the amendments and their impact on your tax planning and tax compliance strategy.⁠
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Linkin.bio: Read more about the 12 key tax law changes that you should be aware of.⁠
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I beg you to remember this: Naysayers can only advise you from their level of perception. None of them share your vision, passion and drive.⁠
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I've often found that naysayers harbour a sense of bitterness as they didn't have the opportunity/ didn't seize the opportunity to pursue their own dreams. Don't allow their seeds of doubt to become your truth as you then may be missing out on a beautiful journey. ⁠
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Don't get caught short. Ensure that you know exactly when your tax returns are due so you can plan ahead and set money aside for tax bills.⁠
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Submitting your tax returns late will attract penalties and interest being added to your tax bill, and as you can imagine, with cashflow being tight for many businesses due to lockdown trade restrictions, this is not an ideal situation for anyone to be in. ⁠
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I suggest checking with your government's revenue services (like SARS or the IRS) for tax deadlines and using a cloud-based calendar (like Google Calendar) to add these deadlines to the calendar. Here you will be able to set notifications that will alert you as to upcoming tax returns that are due for submission, empowering you to never miss a deadline.⁠
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If you have an accountant/ tax preparer who submits tax returns on your behalf, ensure that you request that they inform you well in-advance of upcoming deadlines so that you're both organised.⁠

The idea of a wealth tax is going mainstream, and you can be sure the government is taking a serious look at this. The World Inequality Lab, of which Karl Marx’s heir apparent Thomas Piketty is co-director, has an attentive ear among governments keen to extract more tax revenue. This is a dangerous idea. This is a case of never letting a crisis, particularly an economic one, go to waste. Piketty’s book Capital in the Twenty-First Century was a surprising best-seller, its central thesis being that a wealth tax is needed to correct capitalism’s inherent inefficiencies. There are several rebukes to Piketty, such as this one.⁠
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What this study from the World Inequality Lab proposes is a tax on 350,000 of SA’s wealthiest people of between 3-7% depending on the wealth. The problem here is that the super-wealthy, those with over R150 million in assets, don’t really invite much sympathy, so swiping 7% of their wealth might even get loud applause. But make no mistake, once government gets a taste of this blood, it will develop a hunger for more. ⁠
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Read more from SAIBA > Linkin.bio⁠
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Passion saw me through the tough, early days in business. It was also passion that motivated me to overcome so many obstacles whilst I was designing and building my company.

Today, it's STILL passion that makes me jump out of bed, excited to start my day. Loving what I do makes the long hours and weekend shifts all worth it!

If you don't love what you're doing, maybe it's time for a change. It's never to late to start pursuing your dreams 💙

Maintaining an Audit Trail can be as simple as a record of all your invoices and cheques in numeric order. The thing to remember is to never skip numbers, and record voids in numeric order along with the other items. Remember to denote them as "voided." This assures no gaps in your numerical sequence, and leaves a proper trail for your accountant.

Doing this makes life easier for your accountant. As most accountants charge an hourly rate, making life easier for your accountant means less time spent on your bookkeeping, translating to a friendlier invoice for you. If you have a good accounting system, such as Sage Business Cloud Accounting or Xero, it should maintain an audit trail for you.

Be smart and get organised!⁠

UPDATE ON ADOBE FLASH PLAYER: SARS WEB BROWSER⁠
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SARS has now released a SARS Browser solution that only works with eFiling:⁠
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The SARS Browser enables access to all eFiling forms, including those that require – otherwise would have required – the Adobe Flash Player software, thus maintaining compliance with taxpayer filing obligations.⁠
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The SARS Browser was created in order to successfully view, complete and submit SARS forms that have not yet been migrated to Hyper Text Markup Language (HTML5) on eFiling. In the interim, SARS will still continue the migration process.⁠
Click > https://tools.sars.gov.za/webtools/sarsbrowser/browserdownload.aspx < to download the SARS Browser, You can access the steps on how to download the browser here. The SARS Browser is currently compatible with Microsoft Windows devices.⁠
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The SARS Browser may be used to access forms not yet migrated, which include:⁠
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* RAV01 - Registration, Amendments and Verification Form⁠
* TDC01 - Transfer Duty⁠
* IT3-01 - Financial Certificate Information⁠
* IT3-02 - Financial Declaration⁠
* TCR01 - Tax Compliance Status Request⁠
* DTR01 - Dividends Tax Transactions Information⁠
* WTI - Withholding Tax on Interest⁠
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Existing browsers such as Chrome and Edge will continue to work for all forms already migrated with the major and high volume forms, which are Income Tax (Personal Income Tax (PIT), Provisional Tax, Corporate Income Tax (CIT) & Trusts), Value Added Tax, Pay as you Earn and Excise.⁠
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Optimism, passion and a sheer stubborn nature are personality traits that definitely have kept me going through the years in business!⁠
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Keep a separate bank account for business and personal expenses/ income. If you are an independent contractor or a sole proprietor, you're probably wearing every hat in the business, including taking on the responsibility for your business's bookkeeping. Having a single bank account for both personal and business can cause confusion when it comes time to capture transactions, and you may end up including personal expenses in the business accidentally. ⁠
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Keeping a separate account for business and personal will make it much easier for you to keep business-related expenses separate from personal spend. This will reduce the time needed to sift through one bank account and account for everything accurately.⁠
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SARS is in the process of updating the systems, forms and processes pertaining to the filing of income tax returns for companies. Click here for more information. The following changes will be implemented in a phased approach throughout the 2020/21 financial year:⁠
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* Section 24O - Incurral of interest in respect of certain debts deemed to be in * the production of income;⁠
* Additional questions in section 12R – Special Economic Zones (SEZ's);⁠
* Section 12L- Extension to the "energy efficiency" deduction;⁠
* The revised definition of "Domestic Treasury Management Company";⁠
* Ultimate Holding Company container to accept trust tax reference numbers; and,⁠
* Enhanced Estimated Assessment process.⁠
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A new ITR14 income tax return was implemented on 4 December 2020. ⁠
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If you're not creating a profit and loss report, how are you measuring your business's profitability? A profit and loss report is an overview of your business's total income, cost of sales and overhead expenses. They are usually analysed monthly, quarterly, bi-annually and annually. These reports help you assess the financial fitness of your business, and assist you track your revenue and expenses. ⁠
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I have clients who request a gross profit and loss report, split by sales item. This measures turnover/ sales against cost of sales. These reports help them analyse if a sales item/ project is making, or losing them money for each of these sales items. These key insights assist in setting pricing structures that are profitable, or perhaps finding suppliers who are more cost effective to ensure maximum profitability. ⁠
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Having a good accounting system will save you time. There are many cost effective cloud accounting systems that will generate these reports for you based on the data that you have captured into the system.⁠
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Category: Small Business

Provisional Tax and Your Small Business

Understanding Your Financial Statements

How The Vat Increase Affects Small Business

How To Write A Business Plan

How To Become More Successful

Simple Tips To Help Boost Your Productivity

Create A Business You’re Madly In-Love With

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