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Structuring tax for a side businesses

Nathan says:
12 November 2019 at 17:08

I need some advice regarding how to structure my taxes and what ways I will be able to reduce my tax exposure through deductions, registering as a private Pty vs Sole proprietorship etc... I have a salaried job and am starting up a side business working from home as a web developer. I am also considering to start renting out our flatlet via Airbnb. The total income I am looking at includes (per month): 1) Salary: R70000 2) Airbnb: R3000 (which is a bit hard to estimate right now till we have built a track record, but this is assuming an average occupancy of 13%) 3) Web development: R5000

PS: I own the property and work from home for my side business.

TaxTim TaxTim says:
13 November 2019 at 9:52

Please read our blog on a Sole prop versus a Company set-up to find out more details about the tax implications of each. Please also read our blog on Rental property deductions and Airbnb rental income.

You can also find useful information in our Small Business eBook.

Based on the amounts you have indicated, it would probably make more sense to run your business as a sole proprietor and save yourself the administrative time and costs associated with registering and running a company.

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