# General Business Category > General Business Forum > [Question] Do I start a company or become an employee?

## Bilbo

I work for a small company that recently entered into a JV with another company. My employment is set to be moved to the now new "JV company". The scope of my job has also changed and as a result there may be an opportunity for me to do work for multiple related companies.  

Is it better for me to start my own company and to invoice the entity monthly (on the basis that I will be invoicing other entities as well)? Or should I just become an employee of the new JV company? 

Does anyone have any insight into which is the most tax efficient route? 

Also, what do I risk losing from going to employee to director of my own company with a committed monthly income considering I have vehicle and home financed in my personal capacity? 

Any and all advice will be appreciated. 

Thank You!

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## adrianh

This is like asking whether you should buy a sedan or a bakkie. You need to figure the upsides and downsides out for yourself in you own situation. If you don't have serious "balls" to ride the hard times then going on your own might be really problematic.

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Bilbo (12-Jan-20)

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## Blurock

My first question would also be; "Do you have the balls to start your own company?"
As Adrian had intimated, you need discipline, the will to succeed, the skill to survive and the ambition and innovation to be successful.
Are you prepared to 24/7/365? Are you prepared to take responsibility for everything that happens in your day?
Remember, you ARE the business. Whatever you say or do impacts on your bottom line. There is no boss to run to.

Now that I've scared you off - being your own boss and doing your own thing can be hugely rewarding and may send you in a complete different direction, once you are able to see and grab the opportunities. Good luck!

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Bilbo (12-Jan-20)

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## Blurock

So you have chosen the safe option of being an employee?

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## Bilbo

No. 

Rather ignorantly, I came to this forum seeking specific advice and guidance on a simple tax efficiency question. Instead I was questioned (twice) about my genitalia and appetite for risk. 

I then went on to seek professional advice on what I specifically asked for and received the answers I wanted. 

I also googled the different types of risk associated with the different company set ups in South Africa and chose a suitable way forward for me. 

Thanks for the push and encouragement though! Just what the country needs.  :Smile:

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## Blurock

> No. 
> 
> Rather ignorantly, I came to this forum seeking specific advice and guidance on a simple tax efficiency question. Instead I was questioned (twice) about my genitalia and appetite for risk. 
> 
> I then went on to seek professional advice on what I specifically asked for and received the answers I wanted. 
> 
> I also googled the different types of risk associated with the different company set ups in South Africa and chose a suitable way forward for me. 
> 
> Thanks for the push and encouragement though! Just what the country needs.


Good luck with your career, Bilbo. Keep us posted as to what worked for you.  :Wink:

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## dellatjie

Bilbo, 

Tax wise if you had to register a company, you would get very favorable rates if you are classified as a small business corporation. One of the very first requirements are that you should have at least 3 employees that are not connected persons (read relatives).

If you comply with this requirement, then it might be worth it tax wise to invoice the companies. 

To work as a sole proprietor you will be taxed at the same rates as an employee, but you can deduct a few other expenses. But I must warn you, SARS WILL audit you, so you have to be ready with all supporting documents ie invoices, logbooks etc. 

I hope this gives you an idea of where to start. 


Sent from my iPhone using Tapatalk

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