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Sole Proprietor - PAYE - IRP5

Posted 18 March 2016 under Tax Questions



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Sandy says:
16 March 2016 at 14:33

If I am a sole proprietor and am registered for PAYE/UIF, as I employ one individual, and have paid PAYE for myself during the 2015-2016 tax year so that I don't get hit with a big Income Tax bill at the end (this is over and above the two provisional tax amounts I have paid) - how do I declare this tax paid on an IRP5? Do I declare an income amount even though my accounts have not been finalized or do I leave the income amount blank but complete the 4102 PAYE code on Easyfile?

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TaxTimTaxTim says:
17 March 2016 at 12:59

Do you work through a company?


Sandy says:
17 March 2016 at 13:20

No, as I said I am a sole proprietor registered for PAYE as I employ one person.


TaxTimTaxTim says:
17 March 2016 at 14:05

You actually should only be paying PAYE for your employee. Since you are a sole proprietor, you are not an employee yourself and should be paying provisional tax (and not PAYE) on your earnings.
Since you have paid tax for yourself, you could declare the income amount on which the tax has been paid.

Please make use of our SARS income tax calculator to work this out.

For example, if you paid R4,743 tax for the year, you could declare a salary of R100,000.


Sandy says:
18 March 2016 at 8:56

Thank you!


TaxTimTaxTim says:
18 March 2016 at 11:57

Only a pleasure!


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