Anyone who needs TAX / Accounting Advice

[Ice]

jeeez - I need a bookkeeper!

[Dave A]

What financial software are you using?

[Ice]

Quickbooks Simple Start.

I added a post earlier on but clicked on REPLY WITH QUOTE by accident and I cannot see that post on this forum. Do you know where it would have been posted to?

thanks for all your help thus far!!!

[Dave A]

Quickbooks Simple Start.

I helped someone set up with it not too long ago. It works fine as a basic accounting package, but... I guess I'm used to more features.
It should be enough to keep you out the clutches of a book keeper though. The Quickbooks method of input forms should really help the non-accountant to produce a fairly error-free set of books.

I added a post earlier on but clicked on REPLY WITH QUOTE by accident and I cannot see that post on this forum. Do you know where it would have been posted to?

There's nothing in the moderation queue.
It might well be lost

[Ice]

Mostly I'm doing well with it - just things like the depreciation of an asset is difficult to enter in. Where do our postings on this forum go to if we "reply with quote"? I'm trying to find a posting I made which hasn't appeared here?

[Ant15]

Hi there

REALLY HOPE YOU CAN ASSIST ME ON THIS

I currently work at a school doing teaching, but after hours I do private work as a physio for the disabled children for a maximum of 2 hours a day.

I have bought my own equipment and using one of the schools rooms to do my practice.

What I need to make 100% sure about is what tax I am liable to pay? I earn an income from the school (salary = R9500 p/m) and an income from my practice ( roughly R4000 p/m).

Do pay seperate tax per income or must I combine the two incomes?
Secondly the income from the practice, at what tax rate must I pay it, or since its only
R48,000 p/y do I even have to pay tax on it?

Another thing is, can I charge VAT on the practice invoices and how would I go about that?
Can I claim back for the equipment bought?

Please can someone urgently assist me on this. It would be highly appreciated. Thanks

[Mark Atkinson]

Hi Ant15,

First of all, yes you would have to pay tax on the income earned from the practice.

I am assuming you run the practice as a sole proprietorship.

You need to declare income from all sources in your tax return, so you would list both your salary and your income from your physio practice as separate line items on the same tax return. (It just adds to your total tax payable.) I'm not 100% sure but you may be able to register as a provisional tax payer for your practice income, and make half-yearly provisional tax payments.

You may also claim any expenses which are used in the production of that income as deductions. (For example, if you buy massage oil to treat customers, you may claim that as a deduction).

The fact that your income from the practice is only R48000 p/a is inconsequential as your total income combined is over the tax threshold. If you only earned R48000 p/a from the practice, then you would be below the tax threshold and not have to pay tax.

One thing that I think you might have an issue with is the fact that you use one of the schools rooms to do your practice. Do you pay rent to the school for this? If you do, you may claim that as a deduction. If you don't, however, (and this is where I need somebody to back up my opinion) you might have to declare a reasonable rent for that room as an income. My tax knowledge is a bit rusty, but I seem to remember something about if an employer gives you the use of an asset for free or for less than a reasonable payment, you need to declare the difference as an income.

As far as VAT is concerned, I'm not sure whether I would bother registering for VAT at that sort of turnover. (I'm not even sure you would be able to in the first place.) You don't charge or claim VAT until you are registered as a VAT vendor. You only need to register as a VAT vendor once your turnover reaches R1 million per annum. My advice would just be to save yourself a whole lot of effort and steer clear of VAT altogether.

Hope that helps.

[BusFact]

I second Mark's answer above. Although I don't have any knowledge about the deemed rental either.

[Dave A]

My tax knowledge is a bit rusty, but I seem to remember something about if an employer gives you the use of an asset for free or for less than a reasonable payment, you need to declare the difference as an income.

The employer is supposed to declare the deemed value as a fringe benefit in the IRP5 they issue.

Thinking about all the possible catches, it certainly wouldn't hurt to have written permission to use the classroom for this little venture.

[tax$$$]

Hi

I have a company (Comp A) which holds longterm fishing rights (ie 15 years hake longline etc). Comp A originally bought the quotas from another company after the Minister gave the necessary approval for the transfer.

The fishing rights were accounted for as intangible assets and are written off over the remaining 'lifetime' of it. Are these amounts tax deductable or not? And does it form part of A11(gC) / A23I?

Your help would be much appreciated. Thank you.

[Mike Simmonds]

No it does not fall under Section 11 (gC) or Section 23I of the Income Tax Act, the reason being that it does not fall within the definition of 'intellectual property'.

It appears that these rights are actually goodwill and therefore not tax deductable.

However if these rights actually cost 'another company' money to acquire, and in their hands it was an normal expense or a Section 24 C expense then that portion should rightfully also be tax deductible in your hands.

[dewmap]

Hi

Would appreciate some help with First Provisional submission that has to be made. The question relates to the estimated taxable income. Do I calculate that figure by using the first 6 months estimated income or do I have to estimate the income for the full year and then divide that figure by 2.

The problem I have is that we have been abroad and have only been back in SA from the 1 Aug, therefore only one month salary before the first submission. If I have to estimate on the full year the estimated income will be high compared to the tax that the employer deducted which will only be for 1 month. This will result in us having to pay in a huge amount on the first provisional submission. Am I right in this assumption or do I have it totally wrong.

Any help would be appreciated, Thanks

[Mike Simmonds]

If I have to estimate on the full year the estimated income will be high compared to the tax that the employer deducted which will only be for 1 month. This will result in us having to pay in a huge amount on the first provisional submission.

Do you receive any other income besides your salary? In other words, why are you registered as a provisional taxpayer?

[dewmap]

yes, rental income

[Mike Simmonds]

OK, what you really need to do is calculate what your total taxable income for the year will be. Then calculate the tax payable on that. Then estimate if the tax that is being deducted on your salary for the year is going to cause a shortfall or a refund. If there is a shortfall then this is the amount that needs to be paid over to SARS.