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Does the tax threshold change when you quit your job and begin your own small business from home?

Posted 14 May 2014 under Tax Q&A


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Dear Tim,What happens to the tax threshold for when one is obligated to pay tax (R63k) when you work for a company for the first few months of the financial year and then you quit to start your own venture from home. Does the threshold change? Since I am working for myself my expenses will change as now I will incure the cost of running my business from home and will have to set aside money for my medical aid, retirement fund etc. as this will no longer be paid by my employer.

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TaxTim TaxTim says:
15 May 2014 at 14:50

If your business is in your name and you trade as a sole trader, then the threshold stays the same, individuals are taxed according to the tax tables on income as a whole, regardless if from a business or as a result of employment. The current threshold for the 2015 year is R70 700.


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Small
Business
Tax Returns
Made Easy


TaxTim will help you:

 Do Your ITR14 Tax Return without a Tax Expert
 Claim for all the Deductions your Business Qualifies for
 Turn your Accounting Records into a Tax Return

TaxTim asks you simple questions about your business, then processes your answers and completes your ITR14 business tax return instantly.

Get started