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Tax breaks for small business

Feb 22 2012 14:31
Mzwandile Jacks

Pretoria - Finance Minister Pravin Gordhan on Wednesday said there would be further tax relief for small businesses and micro-enterprises.

He said the tax-free threshold for small business corporations would be increased to R63 556, adding the 10% rate would be reduced to 7%.

“The threshold up to which this rate applies is increased to R350 000. For taxable income above R350 000, the normal 28% corporate rate applies,” Gordhan said.

He said with effect from next month, qualifying micro-businesses (within the R1m turnover limit) would be able to pay turnover tax, VAT and employees’ tax twice a year.

This meant the number of returns and payments a year would be reduced from about 18 to just two.

Several reforms of the turnover tax for micro-businesses (with annual turnover below R1m) were announced in 2011.

The businesses would be given the option of making payments for turnover tax, VAT and employees’ tax at twice-yearly intervals from March this year.

It was further envisaged that a single combined return would be filed on a twice-yearly basis from March 1 2013.

The number of returns required for these taxes would fall from about 18 to only two a year in 2013.

pravin gordhan  |  sa economy  |  smmes  |  budget 2012



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