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Chairperson tax explained

Posted 15 February 2016 under Tax Questions



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HRP says:
11 February 2016 at 18:05

Please explain the following to me:
1. The taxation of non-executive chairpersons of small companies earning a monthly amount in directors (Chairperson) fees. (They work full time earning a salary from a different Company. )
2. Should the non-executive chairperson be treated as an employee on the payroll of the small Company whilst working for another company or can it be treated through normal finance department transactions?
3. Should the normal statutory deductions like SDL and UIF be deducted from chairperson/director fees?

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TaxTimTaxTim says:
12 February 2016 at 10:05

It depends very much on how many hours a month you work for the small companies, and if you are under their supervision and control and are therefore perceived to be an employee or not.

Please describe the hours and nature of the work you do for them.


HRP says:
12 February 2016 at 22:14

Hours worked is a maximum of 2 -4 hours per month and not under their supervision since the person is the chairperson of the board of directors.


TaxTimTaxTim says:
15 February 2016 at 11:33

Based on what you have described, it would be appropriate for you to invoice each company for your gross fees and for you to handle the taxation of your income yourself.
UIF is only deducted if you work more than 24 hour per month for an employer.

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