Thread by @Andre28071990

THREAD: If you're a freelancer/small business, you may be able register for Turnover Tax.

Turnover Tax rates:
0 - 335,000 turnover = 0% tax
335,000 - 500,000 = 1% tax
500,000 - 750,000 = R 1,650 + 2% tax
750,000 - 1,000,000 = R 6,650 + 3% tax

Your turnover must be less than R 1,000,000 to qualify and it's limited to certain industries/trades.

Compared to normal tax 18 - 45% for individuals or 28% for companies or 0 - 28% for SBC's, Turnover Tax has considerably lower tax rates.

Example: Company 28%, Turnover R 300,000, Taxable profit R 50,000 = Tax R 14,000
Company on Turnover Tax would pay R 0 tax

Here's a link from the SARS website. Send me a DM if you want clarity on any confusion.

sars.gov.za/TaxTypes/TT/Pa…

A registered turnover tax entity also has very little record-keeping requirements - unless it's registered for VAT.

If it's registered for VAT, it must still comply with VAT regulations.

Finally, investment income (rental income, interest, dividends, CGT) are excluded from the Turnover Tax calculation, and will be taxed on normal tax rates.

@Yoco_ZA @Mashstartup @LeboLion_SA - I think that entrepreneurs need to know about Turnover Tax as a possible tax saving option.