Compliancy

When must a company file audited financial statements, reviewed financial statements or a financial accountability supplement with its annual CIPC returns?

Public and State-Owned companies (SOC) must file audited AFS while a Private, Personal liability and Non-Profit company and close corporation is not required to have its AFS audited unless –

• in the ordinary course of its business, it holds assets in a fiduciary capacity  for persons who are not related to the company, in excess of R5 million in value at any time during the year;
• it is a non-profit company and was directly or indirectly incorporated by the state, a state-owned company or foreign entity;
• it is a  non-profit company and was incorporated primarily to perform a statutory      or regulatory function in terms of any legislation or to carry out a public function; or
• its public interest score in that financial year, as calculated in accordance with      Regulation 26 (2), is 350 or more or is at least 100 if its AFS have been  internally compiled.

Any other company must have its AFS independently reviewed in accordance with ISRE 2400 unless –

• it is exempt, in terms of section 30 (2A) to have its AFS audited for that year or      reviewed (every person who is a holder or has a beneficial interest in any      securities issued is also a director of the company);
• it is required by its own Memorandum of Incorporation (“MoI”) to have its AFS audited; or
• it has voluntarily had its AFS audited for that year.

A company or a close corporation that is required to have its AFS audited, as indicated above, must file a copy of its latest approved audited AFS with its annual return, while a company or a close corporation that is not required to have its AFS audited as indicated above, may file a copy of its audited or reviewed AFS. If none of the aforementioned is filed, a financial accountability supplement (CoR 30.2) MUST be filed before filing the annual return.

When must a company or closed corporation file it's annual returns?

It is an annual filing and it differs for companies and close corporations.  Companies must file (regardless as to whether it was active or not) within 30 business days starting from the day after its date of registration.  Close corporations must file (again regardless as to whether it was active or not) starting from the first day of the month it was registered up until the month thereafter. It may still file after such period, but an additional penalty fee will be applicable.  

Which set of Financial Statements should be used to determine the turnover for purposes of filing annual returns with CIPC?

A company or close corporation must use its latest approved financial statements for purposes of determining the turnover for purposes of filing annual returns.

What are annual returns?

All companies (including external companies) and close corporations are required by law to file their annual returns with the CIPC on an annual basis, within a prescribed time period. The purpose for the filing of such annual returns is to confirm whether a company or close corporation is still in business/trading, or if it will be in business in the near future.  The annual return may be regarded as a type of annual “renewal” of the company or close corporation registration.

Therefore, if annual returns are not filed within the prescribed time period, the assumption is that the company or close corporation is inactive, and as such CIPC will start the deregistration process to remove the company or close corporation from its active records. The legal effect of the deregistration process is that the juristic personality is withdrawn and the company or close corporation ceases to exist. 

What will happen if the company or closed corporation do not file annual returns? 

The CIPC will assume that the company or close corporation is inactive, and as such CIPC will start the deregistration process to remove the company or close corporation from its active records. The legal effect of the deregistration process is that the juristic personality is withdrawn and the company or close corporation ceases to exist.  

As indicated above, there are cost implications for late filings. Continuous non-filing will result in the company or close corporation being placed into deregistration and eventually being finally deregistered.  During the deregistration process or final deregistration, government departments, SARS, banks and other organizations or the service providers of the company or close corporation may refuse to do business with the company or close corporation until such time that outstanding annual returns have been submitted. 

Deregistration will be automatically triggered by the CIPC when two or more successive annual returns are outstanding.  During deregistration companies and close corporations will be notified by registered mail or alternative electronic methods of communication of the pending deregistration.  The contact details as per the CIPC records will be used to communicate the business status.  If your contact details are outdated or incorrect, you will not receive such notification.

If finally deregistered, the business will have to be re-instated first before it can continue doing business.

• Salary Taxes - 7th of each month
• VAT - Last working day of the month for submissions on E-Filing
• EMP 501 reconciliation - Salary Taxes Midyear - Normally Sept to Oct every year
• EMP 501 reconciliation - Salary Taxes Year End -  Date to be advised by SARS

• Individual Tax returns for non provisional tax payers - 1/7/2023 to 23/10/2023
• Individual Tax returns for provisional tax payers - 1/7/2023 to 24/01/2024

Corporate and Provisional Income Tax:

 Provisional Tax

• First payment – within six months after the start of the year of assessment
• Second payment – on or before the last day of the year of assessment
• Third payment – six months after the end of the year of assessment (for taxpayers with a February year-end it is seven months after the end of the year, i.e. 30 September annually.

Tax on Assessment
Payment of tax upon an assessment notice issued by SARS must be done within the period specified in such notice. For the years of assessment ending on 31 March 2023 and later the rate of Corporate Income Tax payable is 27% (previously 28%). 

Years of assessment ending on or after 31 March 2023:

 Taxable Income (R)Rate of Tax (R)

1 – 91 250 = 0% of taxable income

91 251 – 365 000 = 7% of taxable income above 91 250

365 001 – 550 000 = 19 163 + 21% of taxable income above 365 000

550 001 and above = 58 013 + 27% of the amount above 550 000 

Years of assessment ending on any date between 1 April 2022 and 30 March 2023:

Taxable Income (R)Rate of Tax (R)

1 – 91 250 = 0% of taxable income

91 251 – 365 000 = 7% of taxable income above 91 250

365 001 – 550 000 = 19 163 + 21% of taxable income above 365 000

550 001 and above = 58 013 + 28% of the amount above 550 000