Tag: DigitalCFO

digitalcfo is a chief financial officer that works with digital financial data

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Cloud-based accounting systems and your business.

Let Technology do the work

There are still many outdated systems out there that are soon going to become redundant. In this interesting time, we found ourselves in. Many businesses have been tested in the continuity of their operations with the rise of the COVID-19 pandemic. How much anxiety did it cause you to move your staff off-site? What impact is it having on your business socially and economically? Were you able to continue? Have you considered cloud-based accounting systems as a place to start?

It is time for an update

Updating your systems can have benefits across the board and will have a larger impact than you might expect. These benefits may include cost saving, working with real-time data and systems integrating with one another. I have recently been to a potential client to conduct a systems audit. Everything was fine and dandy until all operations were disrupted. The staff could not access information from home, accounting, client service, and back-office information were all backed up on a server. Yes, information can be accessed by the VPN server, but let’s be honest. Anyone who has worked with these systems knows the shortfalls. It is slow, unstable and could cost a fortune. Your information can be lost in an instant, be it a server crash, theft or fire.

Cloud-based systems

The simple answer is cloud-based accounting systems such as Xero and SageOne. Your data is safe, secure and can be accessed anywhere in the world, as long as you have an internet connection and a computer.

The beauty of these systems is that it never stops evolving and is changing the landscape of business. Take this time at home to do some research on what systems you can use. Just in a week, you have heard about Microsoft Teams, Zoom or Google hangouts. Now is the time to make a proactive decision to protect your business in the coming months ahead. We do not know what the future holds, tomorrow is a mystery. But you can control if you want to stay ahead of the curve.

Please contact us to set up a video conference to chat about possible integrations in your business.

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Do you qualify as a Small Business Corporation & Pay less Tax

 In South Africa, a Small Business Corporation (SBC) is defined under Section 12E of the Income Tax Act (Act 58 of 1962). Section 12E provides certain tax benefits and incentives to qualifying small businesses.

To be classified as a Small Business Corporation, a company must meet the following criteria:

1. Company Size:

The company must be a close corporation (CC) or a private company, meaning it is not publicly traded. Additionally, it must have gross income of less than ZAR 20 million per year.

2. Nature of Business:

The company must operate primarily within South Africa and derive its income from trades or activities that are not specifically excluded by the Income Tax Act.

3. Shareholder Requirements:

The company’s shareholders must be natural persons (individuals) and must hold equity shares directly in the company. Certain types of shareholders, such as trusts, close corporations, and companies, are excluded from qualifying for SBC status.

The benefits of being classified as an SBC in South Africa include:
1. Tax Rates:

Small Business Corporations are subject to a reduced tax rate on their taxable income. The tax rates for SBCs are more favourable compared to the standard corporate tax rates.

2. Accelerated Depreciation:

SBCs are eligible for accelerated depreciation allowances on certain assets, which means they can claim higher deductions for wear and tear on qualifying assets.

3. Losses:

SBCs can carry forward their assessed losses indefinitely and set them off against future profits, subject to certain limitations.

It’s important to consult with a tax professional or accountant to determine if a specific company qualifies as a Small Business Corporation and to understand the exact tax benefits and requirements associated with Section 12E of the Income Tax Act in South Africa. 

For help to see if you qualify, contact us today!