Spectra Bookkeeping Services Pty Ltd

13/01/2015

Seven Accounting Controls That Will Guarantee Your Company Doesn't Make a Financial Loss You Can't Explain.

1. Authorisation

Set up a system that stops anyone from making entries in your accounting records or changing them without your authorisation.

2. Request supporting documents

Tell your management team to show you their receipts or invoices to confirm every income or expense amount.

3. Cross checks

Cross check your accounting data with your bank statements every month. Check every entry in your accounting records matches the information on your bank statement.

4. Sign in sheet

Create a system where employees sign a form before making an entry into your accounting records. You can also create a digital system that links entries to the account or computer they came from.

5. Keep backup copies

Keep backup copies of all your supporting documents and accounting spread sheets. This way you can see if anyone changed your accounting data from one week to another.

6. Make sure everything balances

At the end of every month, do all your calculations to make sure everything balances. This will help you see if there's any money missing.

7. Set up an alert system with your online banking

Set up a system on your online banking to get notifications when money comes in or goes out of your company's account. Keep these notifications and use them to fill in your accounting data in real time. These are a great way to make sure you put the right amounts into your accounting records. It also cuts out the chain of supporting documents that can get lost.

25/11/2014

SARS ALLOWS INPUT TAX ON PROMOTIONAL GIFTS

SARS will allow input tax on the acquisition of certain promotional gifts. For example, golf shirts, t-shirts, umbrellas, pens, calendars, desk pads, calculators etc. These are gifts.

So next time you give your clients gifts, rather opt to give them a promotional gift. Put your branding on the gifts and you can claim the input tax.

WHAT ABOUT OUTPUT TAX?

So if you can claim the input tax, how do you treat the output tax?

Well, when you give promotional gifts to your clients, you don’t levy output tax. This is because you don’t charge or receive any payment for the supply!

Be sure to write it up in your books as “promotional gifts”. So with the savings you’ll get this festive season, you can afford to give your clients superior gifts every year.

17/11/2014

•21-11-2014 - End of Tax Season for Individuals

31/10/2014

NOTIFICATION FROM SARS

The old power of attorney forms will not be accepted at SARS branches if they were completed and signed after October 2013. The old form will only be accepted if it was completed and signed before October 2013 and has not yet expired as per the 2 year limit. Tax practitioners are thus urged to have their clients complete the new power of attorney (TPPOA) form as any old forms signed after October 2013 may not be accepted at the branches. Additionally, tax practitioners wishing to delegate an employee to act on their behalf at a SARS branch must also make use of the ASPOA form.

It is possible for practitioners using the old forms signed after October 2013 to be assisted at certain branches due to the differing practices across the SARS branches. Notwithstanding that, at least have your clients complete the new TPPOA forms so as to eliminate the risk of being turned away at the branches.

24/10/2014

ORDER YOUR UPDATED BCEA AND EEA WALL CHARTS TODAY, FOR ONLY R300 PER WALL CHART (POSTAGE & PACKAGING INCLUDED). SIMPLY EMAIL [email protected]

24/10/2014

TAX EXEMPTION ON FOREIGN EMPLOYMENT INCOME

A thing that all employees are well aware of is that at the end of every month, they don’t receive the gross amount of their remuneration, but rather a reduced amount which was derived by deducting employees’ tax, skills development levies and unemployment insurance contributions from the gross amount of the remuneration. There are, however, special concessions in which the employer would not be required to reduce the employees’ gross salaries with employee’s tax and where the salary may be totally exempt from Income Tax.

One such concession would apply where remuneration is paid to an employee that is a resident for tax purposes for services rendered outside of South Africa, where the employee was physically absent from South Africa for certain periods. The general rule is that income earned by a tax resident of South Africa from the rendering of services anywhere in the world will be included in his/her gross income. This means that the amount may be potentially subject to income tax if a special concession like an exemption does not apply thereto and if the employee does not have a numerous deductions to reduce his/her income that will be subject to Income Tax. However, notwithstanding this general rule, the special exemption for services rendered outside of South Africa may apply to the salary paid to the individual which would cause the salary to be free from Income Tax.

This exemption will apply for services rendered outside South Africa for or on behalf of any employer, as long as the individual is outside South Africa for a period or periods exceeding 183 full days (calendar, not working days) in aggregate, during any twelve month period commencing or ending during a tax year. In addition, the exemption will only apply if, during the 183 day period, there was at least a 60 day continuous period of absence from South Africa.

The taxpayer must be able to prove his absence from South Africa as per the periods above, as well as the fact that such absence was attributable to him rendering services outside of South Africa. But what about periods spent voluntarily abroad, even where the individual was in full employment? A situation that often arises is where employees render services on a rotation cycle, for example two weeks offshore and two weeks onshore having regard to the specific type of industry the employer operates in. The employer may require, due to health and safety concerns, that employees take time off (outside of normal leave days), which the employees may decide to spend offshore rather than returning to South Africa. In spending the voluntary days offshore, the employee may ensure that the 60 day continuous period for purposes of the exemption is met.

It is SARS practice to treat weekends, public holidays, vacation and sick leave spent outside the Republic as part of the days during which the services were rendered during the 183 day or 60 day continuous periods of absence. Should this practice be correct, it should be irrelevant as to whether an affected individual decides to spend a voluntary period abroad and, in so doing, complies with the requirements of the exemption. Any rest period (whether voluntary or compulsory) will be deemed to be included in the calculation of the 183 day or 60 day continuous periods for purposes of the exemption.

Taxpayers making use of this exemption are reminded to exercise caution in ensuring that all requirements are met and possible future changes are taken cognisance of.

24/10/2014

HEALTH & SAFETY

CAUTION: Your employees are your company's biggest health and safety threat.

If your employees don't comply with your health and safety rules, you'll still be the one who faces penalties.

It doesn't matter if you've done everything legally required to keep your employees and workplace safe.

Don't let your employees be your downfall!

Follow these five steps to get your employees to comply and uphold your health and safety compliance...

Step 1: Involve your employees in discussions on health and safety issues. If your employees feel they have a say when it comes to your health and safety, they're more likely to follow the rules.

Step 2: Create a health and safety policy that outlines the health and safety rules you expect your employees to follow. Include the punishment for not complying with these rules.

Get all your employees to read and sign a copy of this policy so you can verify they're all aware of these rules.

Step 3: Create an open door policy in your workplace and tell employees to speak to you if they have a problem with your health and safety procedures.

Step 4: Ensure your health and safety representative is doing his job in terms of conveying your employees' health and safety problems to you.

Step 5: Hold regular toolbox talks on different safety issues with discussion sessions at the end. This will help you get to the bottom of why your employees don't want to comply with your rules.

These five simple steps will help you fix and enforce your health and safety rules. But remember, if your employees still refuse to comply, the only solution left is to discipline them.

24/10/2014

COMPLETING YOUR IT14SD?

Most company owners panic when SARS asks them to complete the Supplementary Declaration (IT14SD form) in order to reconcile annual financial statements and to verify eFiling submissions for the company.

Most of the panic is caused by the fact that these company owners don’t know where to start. For example, they don’t know which documents they need to complete the IT14SD form.

Don’t panic like these employers.

1. Your IT14 (company Income Tax) return showing income for your company in the year of assessment;

2. Your trial balance;

3. Signed financial statements;

4. General ledger; and

5. Employer reconciliation declaration (the EMP201 and EMP501 forms).

It’s also a good idea to have SARS’ employee tax codes available. Remember, you don’t need to submit the documents, SARS just wants to check your calculations.

24/10/2014

23/10/2014

NEW JUDGEMENT RULES THAT PROPERTY OWNERS ARE NOT LIABLE TO PAY FOR RATES AND TAXES INCURRED BY PREVIOUS OWNERS

Municipalities have recently been claiming rates and taxes and other charges from owners of properties, who were not the owners of the properties on the date that the rates and taxes and other charges were incurred. This creates difficulties and uncertainties within the property market as to whether, following transfer of a property, the rates and taxes and other charges may have been considered to have been paid to date.

In the past, a rates clearance certificate would be issued by the municipality certifying that all amounts due under in connection with property have been paid. This certificate would be relied on by purchasers of property, that indeed all such amounts have been paid.

However, due to inefficiencies within municipalities, it appears that amounts due on the property are not always accounted for when an amount is given as payable for a clearance certificate to be issued. Following a wrong interpretation of a judgment in the case of City of Tshwane v Mathabathe, the municipalities have seized upon the opportunity to require owners of properties to pay for rates and taxes and other debts not incurred by them, but by a previous owner.

The Mathabathe Case correctly held that the municipalities have a lien against the property for debts due to them. However, the Court, did not go so far as to suggest that a successor in title to a property was liable for the debts of a previous owner of the property. Some municipalities nevertheless interpreted this to mean that a property owner is liable for the debts of his predecessors in title because of the lien.

If the interpretation of the municipalities was correct, then, apart from the injustice of it all, the practical consequences would be that property owners would never have peace of mind when taking transfer of a property that all rates and taxes had been paid to date, or if they had not been paid, they are immune from the municipality proceeding against them for debts incurred by a previous owner. Similarly banks and other lenders to property owners would never have the certainty that a rates clearance certificate indicated that all rates and taxes have been fully paid, or if not paid, that the municipality would proceed against the current owner of the property for debts incurred by a previous owner.

Fortunately, the Gauteng Division of the High Court has now confirmed that the interpretation of the municipalities is incorrect in handing down a judgment in the matter of Perregrine Joseph Mitchell v City of Tshwane Metropolitan Municipality. The judgment, handed down on 8 September 2014, said the following:
• A successor in title to a property does not become a co-principal debtor regarding the principal debt to the municipality and is not liable for the payment of historical debts incurred by previous owners or occupiers of the property. In other words current owners are not liable for the debts of previous owners;
• The security of the lien held by the municipality was extinguished by the transfer of a property to a subsequent owner;
• The outstanding debt owing by the previous owner, remains owing by that owner. It is unaffected by the transfer of the property to a new owner. So it remains due by the owner that incurred the debt to the municipality.

Accordingly, unless and until this judgment is reversed, the equitable situation, as property owners would reasonably expect, has been restored. Any person who has been forced to pay a debt incurred by a previous owner should immediately be refunded by the municipality concerned.

Municipalities have recently been claiming rates and taxes and other charges from owners of properties, who were not the owners of the properties on the date that the rates and taxes and other charges were incurred. This creates difficulties and uncertainties within the property market as to whether, following transfer of a property, the rates and taxes and other charges may have been considered to have been paid to date.

In the past, a rates clearance certificate would be issued by the municipality certifying that all amounts due under in connection with property have been paid. This certificate would be relied on by purchasers of property, that indeed all such amounts have been paid.

However, due to inefficiencies within municipalities, it appears that amounts due on the property are not always accounted for when an amount is given as payable for a clearance certificate to be issued. Following a wrong interpretation of a judgment in the case of City of Tshwane v Mathabathe, the municipalities have seized upon the opportunity to require owners of properties to pay for rates and taxes and other debts not incurred by them, but by a previous owner.

The Mathabathe Case correctly held that the municipalities have a lien against the property for debts due to them. However, the Court, did not go so far as to suggest that a successor in title to a property was liable for the debts of a previous owner of the property. Some municipalities nevertheless interpreted this to mean that a property owner is liable for the debts of his predecessors in title because of the lien.

If the interpretation of the municipalities was correct, then, apart from the injustice of it all, the practical consequences would be that property owners would never have peace of mind when taking transfer of a property that all rates and taxes had been paid to date, or if they had not been paid, they are immune from the municipality proceeding against them for debts incurred by a previous owner. Similarly banks and other lenders to property owners would never have the certainty that a rates clearance certificate indicated that all rates and taxes have been fully paid, or if not paid, that the municipality would proceed against the current owner of the property for debts incurred by a previous owner.

Fortunately, the Gauteng Division of the High Court has now confirmed that the interpretation of the municipalities is incorrect in handing down a judgment in the matter of Perregrine Joseph Mitchell v City of Tshwane Metropolitan Municipality. The judgment, handed down on 8 September 2014, said the following:
• A successor in title to a property does not become a co-principal debtor regarding the principal debt to the municipality and is not liable for the payment of historical debts incurred by previous owners or occupiers of the property. In other words current owners are not liable for the debts of previous owners;
• The security of the lien held by the municipality was extinguished by the transfer of a property to a subsequent owner;
• The outstanding debt owing by the previous owner, remains owing by that owner. It is unaffected by the transfer of the property to a new owner. So it remains due by the owner that incurred the debt to the municipality.

Accordingly, unless and until this judgment is reversed, the equitable situation, as property owners would reasonably expect, has been restored. Any person who has been forced to pay a debt incurred by a previous owner should immediately be refunded by the municipality concerned.

20/10/2014

Do medical certificates issued by traditional healers have to be accepted by employers? While there does not appear to be an obligation to do so at present, indications are that it will soon become a reality.

As of 1 May 2014 certain provisions of the Traditional Health Practitioners Act (“the THPA”) came into effect. The most important development is the establishment of the Interim Traditional Health Practitioners Council of South Africa (“the Council”).

At first glance it would seem that the door is now open for registered traditional healers to issue medical certificates as proof of incapacity in terms of Section 23(2) of the Basic Conditions of Employment Act of 1997. (In terms of this section, a medical certificate will only be valid if it has been issued and signed by a person who is certified to diagnose and treat patients and who is registered with a professional council established by an Act of Parliament.) However, it would seem that employers do not have to recognise a medical certificate issued by anyone purporting to be a traditional healer at this stage. The reason is that the THPA envisages several regulations to be made by Minister of Health in consultation with the Council. These regulations would deal, amongst other things, with the management and control over the registration, training and conduct of practitioners.

The administration of health care by traditional healers is very different to that of conventional Western medical practitioners. This raises the question as to what extent this will be apparent in the way traditional healers are regulated. It would be interesting to see what standards are set for a person to qualify for registration, as well as how their conduct would be regulated. There is cause for concern if one considers the extent to which sick leave is abused despite the relatively strict requirements surrounding the registration and conduct of medical practitioners currently registered in terms of the Health Professions Act of 1974 (the “HPA”).

There is also the question as to whether the content of a certificate would be prescribed in accordance with a set of ethical rules, as is the currently the case with health practitioners registered under the HPA. If not, the potential for abuse is even greater.

So what should employers do while we wait for the regulations to be promulgated? An employer who receives a medical certificate issued by person who claims to be a registered traditional healer does not have to accept it as proof of illness in terms of s 23 of the BCEA. Once registration with the Council becomes possible, however, employers should insist that certificates from traditional healers, like those from medical practitioners generally, contains a registration number with the Council itself (not with any associated body). This may then be verified with the Council if there is any doubt about its authenticity.