Quick test for individuals and companies

By answering the following questions you will be able to determine if a business meets the criteria to qualify for turnover tax registration.

If the answer to any one of the questions is “NO”, the business will not qualify for turnover tax registration for that year of assessment.

A partner in more than one partnership will not qualify for “turnover tax”. The other partners may still qualify if they are only partners in a single partnership and do not answer “No” to any of the questions below.

Please refer to the Tax Guide for Micro Businesses for assistance with completing the test.

Questions
Will the “qualifying turnover” of the business be less than or equal to R1 million for the year of assessment?
Do you declare that the business is not a “personal service provider” or a “labour broker” without a SARS exemption certificate?
Does the business trade in one of the following forms: sole proprietor, partnership, close corporation, co-operative or company?
If the business is a partnership, do you declare that all the partners will be individuals throughout the year of assessment?
If the business is a close corporation, co-operative or company, do you declare that all of the shareholders/members will be individuals throughout the year of assessment?
Do you declare that the business is not a public benefit organisation, recreational club, association of persons or a small business funding entity?
Does the business have a year of assessment that ends on the last day of February?
Do you declare that the owner, any partner, shareholders, members and the business do not hold shares/interests in a close corporation, company, or cooperative other than the following exceptions: Listed South African companies; Collective investment schemes; Body corporates and share block companies; Venture capital companies; Less than 5% in social or consumer co-operatives; Less than 5% in cooperative burial societies or primary savings co-operative banks; Friendly societies; Any other company that did not trade during any year of assessment and which did not own assets with a total market value that exceeds R5 000 during any year of assessment; Any company that has taken steps to liquidate, wind up or deregister?
a) If you are a natural person, do you declare that the income from “professional services” is not expected to exceed 20% of your total receipts during the year of assessment b) If the business is a company, close corporation or co-operative, do you declare that income from “professional services” and “investment income” is not expected to exceed 20% of the total receipts for the year of assessment?
Do you declare that the income from the disposal of assets by the business over the year of assessment and the past two years of assessment is not expected to exceed R1.5 million in total?
Do you declare that the business was not previously registered for the Turnover Tax?

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