FAQ Blog Calculators Students Logbook Contact
Do your Tax with TaxTim and WIN R10,000  More info   T&C's apply


Pay yourself a monthly salary or pay income tax on profits?

Posted 10 February 2013

My daughter has a internet buying and selling business. It is making good profits and she wants to know whether she should take those profits out as a regular monthly salary and pay PAYE or leave it as profit and pay income tax at the end of the year on it. She is operating as a sole proprietor from home.

TaxTim TaxTim says:
10 February 2013 at 22:12

If she is operating as a sole proprieter then the profits of the business are taxable in her hands as an individual so there is no need to pay a "salary" and the resulting PAYE as whatever taxable income leftover after that would be taxed at her tax rate. It would make more sense to include the taxable income as part of her tax return and she would be able to use the profits as she sees fit.

This entry was posted in Tax Q&A and tagged , . Bookmark the permalink.




Submit your tax return right here!

TaxTim will help you:

 Do Your Tax Return Easily
 Avoid penalties
 Maximise your refund
Tim uses your answers to complete your income tax return instantly and professionally, with everything filled in in the right place.

Let Tim submit your tax return direct to SARS in just a few clicks!

Get started

Blog Categories


Ask TaxTim

Got a question you want answered about tax?

Visit our helpdesk →

Get SARS Tax Deadlines in your Inbox
We'll tell you when you need to file, along with tax tips and updates.