About PATAX

About2019-01-12T08:16:35+00:00

PATAX do professional Accounting and compile Annual Financial Statements in accordance with the International Financial Reporting Standard for Small and Medium-sized Entities.  We also do all tax related services inter alia returns, registrations, tax audits and remissions.

Tax calculations and submission are done by qualified Tax Practitioners in order to entitle your company to a tax clearance status.

Tax debt, we may help in suspension of payment or compromise. Tax Audits or Objections can be resolved effortless by our tax team. We do Company registrations, CIPC annual filing, CIDB, BBBEE, Close Corporation and Private Company (Pty) Ltd amendments such as name change, member or director changes. We also act as company secretaries that keep record of shareholding, share and equity transactions and share certificates.

We also do Trust registration and administration as well as last will and testaments, acting as executors of deceased estates. Problem solving such as difficult account reconciliation example bank recons etc. resolved in a breeze.

87%

Successful penalty remissions

94%

Funding/Financing application support.

100%

Client satisfaction

Any Questions?

  • Medical deductions explained 

Firstly, you are entitled to a Medical Aid Tax Credit, (a deduction in your tax payable), equal to a certain amount times the main member and numbers of dependents times months contributed.

  • R310 (2019) per month each for the main member and the first dependent (in 2018 this was R303 p.m.)
  • R209 (2019) per month for each additional dependent (in 2018 this was R204)

 

EXAMPLE: For a main member with a spouse and 2 children for eleven months in the year the deduction will be:

R310+R310+R209+209) X 11=R12 456.

Secondly, your Medical Aid Contributions are used to calculate, together with other medical expenses, your Other Medical Tax Credit (a deduction in your tax payable).

This calculation for persons under 65 years is as follow:

A = medical aid contributions – (4 X medical Aid Tax Credit) as per above.

B = other qualifying medical expenses not paid by the medical aid.

C = taxable income X 7.5% THUS:

Other Medical Tax Credit = (A-B+C) divided by four (4)

 

EXAMPLE: For a total medical aid contribution of R60 000 and other medical expenses of R 5 000 and taxable income of R 150 000 the Other Medical Tax Credit wil be calculated as follow:

A = R 60 000 (4 X R12 456) = R 10 176

B = R 5 000

C = R 150 000 X 7.5% = R 11 250

Other Medical Tax Credit = (R 10 176 + R 5 000 – R 11 250)                                                    ÷ 4 =    R 981

 

For persons over 65 years or under 65 with a disability the calculation is as follow:

A = medical aid contributions – (3 X medical Aid Tax Credit) as per above.

B = other qualifying medical expenses not paid by the medical aid.

THUS:

Other Medical Tax Credit = (A + B) divided by three (3)

EXAMPLE: For a total medical aid contribution of R60 000 and other medical expenses of R 5 000 and taxable income of R 150 000 the Other Medical Tax Credit wil be calculated as follow:

A = R 60 000 (3 X R12 456) = R 22 632

B = R 5 000

Other Medical Tax Credit = (R 22 632 + R 5 000)

                                                   ÷ 3 = R 9 210

NB: Only payments made to doctors, nursing homes, hospitals & pharmacies for prescribed medicine will qualify for “Other Medical Expenses”.

A certain portion, as per “inclusion rates” below, of the gain / profit  made on capital transactions are added onto your taxable income and together are taxed according to the applicable tax table.

Samples of capital transactions will be the sale of your house or other fixed property, the sale of shares in a company, the sale of members interest in a close corporation, the sale of a boat (longer than 10 m), the sale of an aircraft (heavier than 450kg), the sale of financial instruments etc.

Important to note that personal used assets does not attract capital gains tax. Personal use assets are, except the above mentioned assets, assets NOT used in the process of carrying on of a trade.

Capital Gain is calculated by deducting the base cost from the proceeds. The base cost is normally the cost of the asset i.e. the purchase price and the proceeds is normally the amount you are receiving in exchange for the asset.

Capital gains tax was introduced on the 1st of October 2001 and therefore the base cost of assets acquired before then need to be determined. There are three methods used, you will use the one that is the most favorable to you (the one resulting in the highest base cost).

  1. Official Valuation on 1 Oct 2001
  2. 20 % of proceeds
  3. Time apportionment base cost (TABC Calculator Link)

Inclusion rates are applicable i.e. only part of the capital gain is included in your taxable income.

  • Individuals and special trusts it is 40% and
  • Companies and Trusts it is 80%.

 

Annual Exclusions are, for natural persons R 40 000 per year and R300 000 in year of death.

Other exclusions are R 2 000 000 of the proceeds on the sale of your primary residence, R 1 800 000 of proceeds in the sale of assets of a Small business or shares in a small business.

Companies and Close Corporations (cc’s) are taxed at a rate of 28% BUT, in order to incentives small businesses, Companies and Close Corporations who’s shareholders is natural persons and;

  • the gross income does not exceed R20,000,000
  • the shareholders does not hold any shares in another company or close corporation excluding companies listed on the stock exchange, non-profit  company, a body corporate or a company that did not trade and have assets worth less than R5 000
  • the company is not a personal service provider
  • not more than 20% of its income consists of investment income and capital gain

The tax of a Small Business Corporation is calculated based on the following table for 2019:

  • R NIL       to  R 78 150      =  Nil
  • R 78 151    to  R 365 000    =  7% of amount over R  78 150
  • R 365,001 to  R 550,000    =  R 20,080 + 21% of amount over R 365,000
  • R 500,001 and môre          =  R 58,930 + 28% of amount over R 550,000

South African Dividends are taxable in  the hands of the receiver of the dividend at a rate of 20% BUT this tax is withheld and paid over by the company paying the dividend thus should not be included in the tax calculation.

Donations up to R30 million are taxed at a rate of 20% donations more than that at 25%. Exempt from donation tax includes the first R 100 000 per year donated by natural persons and the first R 10,000 donated by corporate entities also donations between spouses.

Estate duty is calculated at a rate of 20% on estates valued up to R30 million and 25% on estates valued above R 30 million

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Contact Info

68 Southwell road, Port Alfred, 6170

Phone: +27 46 624 1000

Web: http://www.patax.co.za