Is there a maximum amount of money I can loan out to friends and family? Can I loan out R2 mil without having some kind of license? Someone told me that you can only ever loan out R500 000 at a time, being broken up into maximum of 100 loans. I have loaned out more than R500 000, so I need to know if I am in the wrong here and what I can do to fix it.
Technically the new credit act speaks of loaning any money requiring a license. However you most likely will not be fined at all, do you charge interest?
Dewaldsays: 18 April 2016 at 12:14
I don't have to charge interest, but if I must for tax purposes I will. I just want to know if I could get away with loaning out say R2 mil, R40 000 to 50 different individuals. If this will get me into trouble, what is the maximum amount of money I can loan out?
TaxTimsays: 18 April 2016 at 12:22
As the law is, if you are making loans of more than R1 even then you would need a license. It is not advisable to make 50 loans of R40 000. It would be better if you loaned out R2m in one go charging interest.
Get SARS Tax Deadlines in your Inbox
We'll tell you when you need to file, along with tax tips and updates.