Tax implications for offering consultations in my free time

[Praeses]

Hi everyone

I'm full-time employed, but would like to offer consultation services in my free time in my personal capacity, probably like once or twice, definitely not a long term plan.

I need to set up a formal invoice to get paid, and would like to know how this would work. I'm pretty much not clued up at all on finances and taxes, besides being able to do very trivial efiling, so any help would be appreciated!

Firstly, do I need to charge VAT and pay that to SARS?
Can I invoice someone for my services without owning a business? Do I just need to have my income tax number on the invoice?
How do I declare this additional income when I do efiling again next year?
What else should I take into consideration?

 

[Steamy Tom]

You only charge vat if you exceed the threshold to become vat registered.

You charge cash and put it under your mattress

 

[chrisc]

Operate as a sole proprietor. No need for any tax numbers. Just your name and address and bank details for payment

keep it simple

 

[Praeses]

You only charge vat if you exceed the threshold to become vat registered.

You charge cash and put it under your mattress

Unfortunately I can't get paid in cash Need to properly invoice

 

[Praeses]

Operate as a sole proprietor. No need for any tax numbers. Just your name and address and bank details for payment

keep it simple

Awesome, thanks

 

[Snyper564]

Awesome, thanks

Also all expenses related to your consultations can be deducted. As they said keep it simple as a sole prop then as little admin as possible.

 

[TheMightyQuinn]

Hi everyone

I'm full-time employed, but would like to offer consultation services in my free time in my personal capacity, probably like once or twice, definitely not a long term plan.

I need to set up a formal invoice to get paid, and would like to know how this would work. I'm pretty much not clued up at all on finances and taxes, besides being able to do very trivial efiling, so any help would be appreciated!

Firstly, do I need to charge VAT and pay that to SARS?
Can I invoice someone for my services without owning a business? Do I just need to have my income tax number on the invoice?
How do I declare this additional income when I do efiling again next year?
What else should I take into consideration?

Go to the CIPC website and register a Sole Prop

No VAT # required...sounds like you won't even get lose to that threshold.

 

[Sehcaep]

Go to the CIPC website and register a Sole Prop

No VAT # required...sounds like you won't even get lose to that threshold.

To my understanding, you can't register a Sole Proprietor with CIPC. However a sole proprietor can register the trading name with CIPC as a Defensive Name.

 

[jezzad]

Couple grand a month I would have it paid into your personal bank account and leave it at that.

If it starts getting to the point where its a sizeable chunk and you want to start allocating expenses to it (cellphone, office etc) then go and register a business via CIPC, open business bank account and setup an invoicing system. Also probably worthwhile getting a accountant sooner rather than later to take care of tax and expenses and books.

You only need to register for Vat when your earning over a million rand a year.

Do not charge Vat unless your registered otherwise big ****.

 

[Crayons]

In a sole proprietorship can they not sue your ass and take everything down to your last pair of boxers with holes in them? Is it not safer in a company?

 

[Sehcaep]

In a sole proprietorship can they not sue your ass and take everything down to your last pair of boxers with holes in them? Is it not safer in a company?

Yes

 

[Steamy Tom]

In a sole proprietorship can they not sue your ass and take everything down to your last pair of boxers with holes in them? Is it not safer in a company?

exactly why you cant register a cc anymore

 

[Alton Turner Blackwood]

Have you informed your employer?

 

[ShaunSA]

Have you informed your employer?

That he's a part time gigolo?

That won't end well

 

[GhostSixFour]

Have you informed your employer?

This. Many employers have anti-moonlighting clauses in their contracts. You'll be right stuffed if you get caught.

 

[$m@Rt@$$]

Operate as a sole proprietor. No need for any tax numbers. Just your name and address and bank details for payment

keep it simple

No

 

[gregmcc]

If the work you are offering is the same type of work as your full time job then there will be a conflict of interest. You need to inform your employer otherwise your part time job will soon become your new full time job.

 

[Snyper564]

If the work you are offering is the same type of work as your full time job then there will be a conflict of interest. You need to inform your employer otherwise your part time job will soon become your new full time job.

This it's Def in my contract one of the last clauses.

 

[krycor]

Was about to ask about the work clause thing.. it’s almost always in there that you need to inform them at minimum for tax purposes.

Ps. Any income needs to be declared surely on top of you primary work. Not sure how this would work given that you likely on paye

 

[Snyper564]

Was about to ask about the work clause thing.. it’s almost always in there that you need to inform them at minimum for tax purposes.

Ps. Any income needs to be declared surely on top of you primary work. Not sure how this would work given that you likely on paye

It's not an issue for paye, you become a provisional tax payer. The employee pays paye as normal and you pay the rest of your tax liability via your provisional returns. You can definitely not inform them as it's not a tax issue but if it's the same work there is definitely a potential issue from a conflict of interest etc.