CATEGORIES
- (47)Accounting & Financial Reporting
- (1)Accounting for Income Tax
- (1)Application of tax rates, s6(2) rebates
- (1)Assessed losses
- (10)Blogs
- (1)Business Advisory
- (8)Capital Gains Tax
- (1)Capital Gains Tax - Individuals Tax
- (1)Capital Gains Tax Implications of Trusts
- (2)Case study: Home office expense
- (1)Case study: Travel allowances
- (1)Company Formations
- (136)Corporate Tax
- (10)Customs and Excise
- (2)Deceased Estate
- (1)Deductions Pre-trade and prepaid expenses
- (1)Deregistration
- (2)Employer and Employee (PAYE and UIF Specific)
- (1)Estate Duty
- (1)Events / Webinars
- (11)Faculty News
- (2)Farming
- (168)Individuals Tax
- (1)Input - Customs Duty
- (3)Interest
- (18)International Tax
- (1)Nature of the rights of beneficiaries
- (1)Notional input tax
- (9)Payroll
- (2)Practical Payroll
- (2)Provisional tax (Link with other Taxes)
- (4)SARS Issues
- (156)Tax Administration
- (2)Tax Administration Part 2B: Resolving Problems with SARS using the Tax Ombud
- (1)Tax Administration Part 3B Dispute Resolution - Objection and appeal
- (3)Tax Dispute Resolution
- (1)Tax Opinions
- (3)Tax Update
- (1)Tax implications of loans to trusts
- (1)Tax residence
- (1)Tax returns and payments
- (3)Transfer-Pricing
- (1)Trust Income / Gain Allocations
- (1)Trust types and income allocations
- (10)Trusts
- (84)VAT
- (3)VAT periods
- (1)Wear and tear allowances
- (13)Wills, Estates & Succession
- (1)Zero Rated
- (2)eFiling
- Show All
Sole Proprietor - Micro Business Tax
- 02 October 2023
- Individuals Tax
- The Tax Faculty Tax Specialist
This FAQ article is based on tax law for the year ending 29 February 2024.
Question:
Regarding sole proprietors projecting a loss in the 2024 tax year, are they obligated to submit a Provisional Tax return even in the absence of taxable income, and if required, should the reported taxable income be zero, while addressing Gross Income reporting requirements, especially when the combined income from the sole proprietorship business and other earnings results in a negative total income?
Answer:
For tax purposes, a sole proprietor is considered an individual, and their taxable income is calculated by subtracting allowable deductions from their total income, which includes income from their trade. If there's a loss in their trade income, it can be offset against other sources of income, like salary, to determine the final taxable income. In the case of a provisional tax return, it will show the turnover and report a nil-taxable income if the sum of all taxable components results in a negative figure.
Join Prof Jackie Arendse October 19th where she will focus on resolving the current taxpayer issues experienced by tax practitioners
- Click here to intro snippet.
- Click here to for more information