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Tax liability for an Independent Contractor

Posted 25 April 2016 under Tax Q&A


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Soraya says:
23 April 2016 at 15:54

My son started as a independent contractor March 2015 and has not paid tax. He earned R10k for 2 months and R5k for the rest of the year. He got paid a lump sum of R80k when the job was done. He is going to SARS but what tax or penalties can he expect

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TaxTim TaxTim says:
25 April 2016 at 10:59

When did he receive the R80K?

Soraya says:
25 April 2016 at 11:11

June 2015

TaxTim TaxTim says:
25 April 2016 at 11:24

Please use our SARS income tax calculator and enter his gross earnings for the year (i.e. R95,000) in order to see the tax due. For the purposes of this calculation, you can ignore the UIF deduction.

He should be registered as a provisional tax payer and pay tax twice a year on his earnings. Please read our blog on What is Provisional Tax? How and when?

SARS will probably impose Provisional Tax Penalties but he should discuss this with the SARS consultant when he visits the branch.


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