Private Company (Pty) Ltd

[Emulov]

Good day all,

I would like to ask the experts some advise/questions.

I have registered a Private Company about two years ago but never did anything further.

The time has now come where I want to start doing something on the side and I thought I might as well use that company that I've registered to trade under. I still have my day-job.

I would like to know..

1. Can I trade under a private company and only be myself ( one man show ) ?
2. Do i have to open a business bank account or can i just use my own personal bank account for now ?
3. When will I have to start paying VAT ? (I am starting off very small and wont make a lot for now)

Any accurate answers will be very much appreciated!

 

[qwertydudeza]

Good day all,

I would like to ask the experts some advise/questions.

I have registered a Private Company about two years ago but never did anything further.

The time has now come where I want to start doing something on the side and I thought I might as well use that company that I've registered to trade under. I still have my day-job.

I would like to know..

1. Can I trade under a private company and only be myself ( one man show ) ?
2. Do i have to open a business bank account or can i just use my own personal bank account for now ?
3. When will I have to start paying VAT ? (I am starting off very small and wont make a lot for now)

Any accurate answers will be very much appreciated!

Firstly check the company status with CIPC that it is still registered, have you done zero annual return?

Yes you can be a "one man show" under a company
Business Bank Account is advised to keep things simple with the auditors/accountants and SARS
VAT is payable when turnover exceeds R1 million per annum. There is some exceptions and voluntary. Read the VAT guide on SARS website.

 

[Species8472]

Check your work contract, some companies have a clause that you either cannot do any work on the side, or if you do they "own" it.

Just make sure you don't go through all the hard work only to have someone else take it from you.

 

[Raphael123]

Before you get to the questions you may want to contact http://www.cipc.co.za/Companies.aspx to see if the company is still registered.

 

[Greig Whitton]

To echo what others have shared: check with the CIPC that your company is still registered (they can deregister companies that don't submit annual returns).

Definitely open a bank account exclusively for your business. It will be easier for you to separate personal and business expenses while reinforcing the mindset of a proper business owner instead of a fly-by-night chancer. A separate business account can also bolster your credibility (clients may be concerned about doing business with a supplier that is trading through a personal bank account). And, as qwertydudeza pointed out, a separate business banking account will make things easier when dealing with SARS, book-keepers, auditors, etc. (and you really, REALLY want to keep that side of your business as simple as possible!)

You have to register for VAT if your annual turnover exceeds R1 million. However, I would recommend registering voluntarily as soon as your business starts to take off so that you can familiarise yourself with your VAT responsibilities well in advance and not rush around sorting this out at the last minute when it is compulsory to do so. Furthermore, depending on your market, some clients may regard suppliers who aren't registered for VAT as less credible. (Note: you can only register for VAT voluntarily when you have achieved an annual turnover of at least R50,000).