Monthly Bookkeeping and Payroll

Bookkeeping is the process of recording and organizing financial transactions of a business. It involves maintaining accurate and up-to-date records of income and expenses, bank statements, invoices, and receipts. Payroll, on the other hand, involves calculating and processing employee salaries, tax deductions, and other employee benefits. By hiring a professional firm like HDI to handle your bookkeeping and payroll, you can free up your time and focus on other aspects of your business. We use specialized software both computer or cloud based and have the necessary expertise to ensure that your financial records are accurate and up to date. We would also provide you with regular management accounts or cloud access which can help you make informed business decisions and avoid any potential financial discrepancies and penalties.

VAT201, EMP201 & EMP501 Registrations & Submissions

In South Africa, businesses are required to submit VAT201, EMP201 and EMP501 returns to the South African Revenue Service (SARS) every month or bi-monthly for VAT and bi-annually for the EMP501s. VAT201 is a value-added tax return that reflects the VAT charged on sales and the VAT paid on purchases. EMP201 is an employer declaration of employee tax and includes details such as PAYE, UIF, and SDL, EMP501 is a summary of the EMP201’s and your employees annual tax certificate, IRP5. Submitting accurate and timely VAT201 and EMP201 returns is crucial to avoid penalties and interest charges. We have the necessary expertise and knowledge to ensure that your VAT and employee tax submissions are accurate and submitted on time. We know how to minimize your VAT liability by claiming all allowable inputs and how to structure your salaries in the most tax cost-effective manner.

We can also deal with SARS on your behalf and register for company for VAT or Payroll taxes.

Annual Financial Statements and Tax Planning

Preparing annual financial statements is a legal requirement for all South African companies. These statements include a balance sheet, income statement, and cash flow statement. They provide a snapshot of a company’s financial performance and position. We can prepare annual financial statements that comply with the South African Companies Act and International Financial Reporting Standards (IFRS). We are also able to audit or independently review your annual financial statements and can also provide advice on tax planning to help minimize your tax liabilities and maximize your tax savings.

Tax Return Submissions

In addition to annual financial statements, businesses are required to submit tax returns to SARS. These returns include income tax returns, provisional tax returns, and as already mentioned VAT and PAYE returns. We can assist with the preparation and submission of these returns to ensure that they are accurate and submitted on time. It is more important than ever to ensure returns are done on time as from 2023 SARS will be issuing administrative penalties for all late submissions and this administration penalty will be levied monthly until you become compliant with SARS. We also provide advice on tax planning and assist with any tax-related queries from SARS.

In conclusion, hiring a professional firm such as HDI to handle your monthly bookkeeping and payroll, assist with VAT201 and EMP201 submissions to SARS, and offer comprehensive services such as preparation of annual financial statements and tax planning and submission of relevant tax returns is crucial for any business. By outsourcing these tasks to professionals like us, you can free up your time, reduce your financial risks, and ensure compliance with South African financial and tax regulations.

Contact Us

Telephone: 031 563 1259

Email: info@hdigroup.co.za

Address: 7 Canford Park, 53 Anthony Road, Durban North

By HDI Group
HDI Accounting and Taxation Incorporated

We want to take a moment to remind you of the importance of having a reliable and professional accounting and tax firm on your side and we are pleased to offer our services to ensure that your tax affairs are handled with the utmost care and expertise.

Our firm has a team of qualified accountants and tax professionals who are dedicated to providing you with accurate and timely accounting and tax advice. We understand that tax laws and regulations can be complex and ever-changing, which is why we make it our mission to stay up-to-date on all the latest developments to ensure that you are receiving the best possible service.

In addition to our Tax Services, we also offer a range of Audit Services and Accounting Services to assist you with your day-to-day financial needs. From bookkeeping to audited financial statements, our team is equipped to handle all your accounting needs.

If you are interested in learning more about our accounting and tax services, please do not hesitate to contact us.

Contact Us

Telephone: 031 563 1259

Email: info@hdigroup.co.za

Address: 7 Canford Park, 53 Anthony Road, Durban North

By HDI Group
HDI Auditing Incorporated | HDI Accounting and Taxation Incorporated

Who is provisional tax for?

If you earn any of the following income greater than R 30 000 per year and your total taxable income is greater than the tax threshold, then you will be a provisional taxpayer: Rental Income, Interest and Investment Income, Business Income, Capital Gains etc. Provisional tax is also payable by all companies which automatically fall into the provisional tax system. A provisional taxpayer is defined in paragraph 1 of the Fourth Schedule of the Income Tax Act, No.58 of 1962.

When do I have to submit and pay provisional tax?

Provisional taxpayers are required to submit provisional tax returns also known as IRP6’s twice a year, the first provisional return needs to be submitted 6 months into the financial year and the second provisional return needs to be submitted at financial year end. There is also an optional third provisional return, also know as a top-up return. If you are an individual provisional taxpayer or a corporate taxpayer with a 28 February year end, your first provisional return will be due by 31 August 2022 and the second by 28 February 2023.

What happens if I am supposed to file a provisional return but don’t?

We are talking about SARS and tax here so, yip you guessed it – interest & penalties!! … and to make things even worse there is no longer a registration or de-registration process to be a provisional taxpayer. The onus is on the taxpayer to determine if he or she is liable for provisional tax, and to request and submit an IRP6 return via eFiling.

What penalties do provisional taxpayers face and how to avoid them

• Late Payment Penalty

If you file your provisional tax return and pay after the deadline SARS will automatically raise a 10% penalty on the balance due and also raise interest at the prescribed rate which is linked to prime.

• Under-Estimation Penalty

SARS expects you to accurately calculate your estimate, there is however some parameters your estimate can fall within to be safe. To prevent taxpayers from reporting lower numbers or incorrect numbers SARS imposes hefty penalties for understatement. This penalty is calculated at 20% of the difference between the normal tax payable for your estimate and tax you should have paid on your actual taxable income.

• Late Submission Penalty

SARS does not take late submissions of tax returns and/or payments lightly! Even one day late is considered late enough to make you pay a penalty. If you miss the deadline or do not file at all SARS will consider you submitted a NIL return and this will result in a 20% under-estimation penalty being imposed.

Reversal of Provisional Tax Penalties – Is it possible?

These penalties may seem harsh, but they exist to discourage taxpayers from deliberately underpaying their tax or postponing paying it so it is extremely hard to object and get these reversed.  If you have a genuine reason for paying or submitting late, and you can provide detailed evidence to back it up then it is possible to get SARS to reverse your penalty – or at least part of it.

We know it is painful and time consuming but it is very necessary to do your provisional return accurately if you do not want to be lumped with penalties and placed in SARS bad books ….. and believe it or not there is actually such a thing! Repeat offenders get less leniency from SARS when it comes to disputes and objections!

If you need assistance with any of your tax compliance, contact us.

HDI Accounting and Taxation

Telephone: 031 563 1259

Email: info@hdigroup.co.za

Address: 7 Canford Park, 53 Anthony Road, Durban North

Photo by Nataliya Vaitkevich: Pexels

By HDI Group
HDI Auditing Incorporated | HDI Accounting and Taxation Incorporated