A Practical Guide for South African Small Business Owners
As a small business owner, compliance with tax regulations is an unavoidable part of running a company. With SARS’ new requirements regarding beneficial ownership, many small businesses are facing yet another layer of complexity. But what does “beneficial ownership” mean, and what actionable steps can you take to meet these requirements efficiently? Let’s break it down into simple terms—and if you’re looking for a stress-free solution, Zaccheus Accountants is here to make compliance easy for you.
What Is Beneficial Ownership and Why Does It Matter?
In plain English, beneficial ownership refers to the person (or people) who ultimately owns or controls a company. SARS now requires small businesses to disclose this information as part of their corporate income tax return (ITR14) submission process, starting from the 2022 tax year.
Why the change? South Africa, as a member of the Financial Action Task Force (FATF), is committed to transparency and fighting financial crimes. The goal is to ensure adequate and accurate information about the actual owners of companies is available to the authorities.
What You Need to Know as a Small Business Owner
- Who Qualifies as a Beneficial Owner?
Beneficial ownership is about control, not just shareholding. An individual who materially influences your company’s management or holds substantial shares may not automatically qualify unless they ultimately own or control the business. - Complex Ownership Structures? No Problem.
Chains of ownership can be tricky, and tracing ultimate control may involve navigating through multiple layers. This complexity might seem daunting, but it’s a legal requirement that all businesses must comply with. - Listed Companies and State-Owned Enterprise (SOE): Different Rules Apply
If your company is listed on the stock exchange or is a state-owned enterprise, the rules are slightly different. For example, SOEs rely on their founding documents to clarify beneficial ownership.
Actionable Steps to Meet SARS’ Beneficial Ownership Requirements
Small business owners, here’s how you can tackle this new requirement:
- Familiarise Yourself with SARS’ Corporate Income Tax Guide
The updated guide provides clarity on how to complete the ITR14 form. While it’s a hefty document (163 pages), focusing on the sections about beneficial ownership will save you time. - Identify Your Beneficial Owners
Examine your company’s structure and determine who ultimately owns or controls the business. Be prepared to trace through chains of ownership if necessary. - Document and Submit Beneficial Ownership Registers
Compile accurate records of your beneficial owners and include them with your ITR14 submission. Ensure your registers meet SARS’ standards for adequacy, accuracy, and timeliness. - Consult Experts if You’re Unsure
The process can be complex, and mistakes in compliance might lead to penalties. Engaging experts, such as Zaccheus Accountants, can save you from unnecessary headaches.
Why Choose Zaccheus Accountants?
At Zaccheus Accountants, we specialise in simplifying tax compliance for small business owners. Here’s why we’re your best ally for navigating beneficial ownership requirements:
- Expertise in Tax Regulations: Our team stays updated on the latest SARS requirements, so you don’t have to.
- Personalised Support: We tailor our services to meet the unique needs of your business.
- Time and Stress Savings: Let us handle the paperwork while you focus on growing your business.
Making the choice to partner with Zaccheus Accountants means choosing peace of mind. We’re here to ensure your compliance is accurate and timely, allowing you to avoid penalties and concentrate on what you do best.
The Bottom Line
SARS’ new requirements for beneficial ownership may seem overwhelming, but with the right approach—and the right partners—compliance doesn’t have to be stressful. By taking these actionable steps or relying on Zaccheus Accountants for expert assistance, you can make this process straightforward and hassle-free.
Contact us today to learn more about how we can help you navigate these changes effortlessly. Your compliance journey starts here
