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IQuote Wealth Smart accounting

IQuote Wealth Smart accounting. T2 and T4. Fact. The average household earns 100% income Pays 30% to tax Pays 30% to debt They try and live off 40% of their income which is why most people have more month than money.

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IQuote Wealth Smart accounting

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  1. IQuote WealthSmart accounting T2 and T4

  2. Fact • The average household earns 100% income • Pays 30% to tax • Pays 30% to debt • They try and live off 40% of their income which is why most people have more month than money. • Simple solution= reduce your expenses or increase your income. Why not do both? • Wealth comes from what we keep not what we earn.

  3. Smart accounting • If your expected to pay tax on earnings, anything that costs money to make money is taxable. • If your paying tax, this should be seen as a good thing as this means your making money. • Some people seem to be making money as they are paying tax, however, they don't know that they can claim for certain costs if they owned a business. • We are not accountants, this is a simple guideline to the logic of being smarter with your income, always consult a professional to assist you to execute this correctly.

  4. The difference Salary earner Business owner Income R 50 000 Car R 5000 Fuel R 2000 Rent / Bond R 10 000 (3000) Cell R 1500 Stationary R 200 DSTV R 650 Internet R 200 Laptop R 200 PM Net R 37 250 Tax 30% = R 11 175 Saving R 4325.00 X 12 = R 51 900 PA • Income R 50 000 PM • Tax 35% Gross = R 15 500 • Net = R 34 500 • Car R 5000 • Fuel R 2000 • Rent / Bond R 10 000 • Cell R 1500 • Stationary R 200 • DSTV R 650 • Internet R 200 • Laptop R 200 PM (FINANCE) • Net R 14 750

  5. Other benefits • When a person owns a company, the company pays tax on profits, so all personal business costs can be moved over to the company. • If a person has a wife that is unemployed or a son, that lives in the family home, one can employ them for R 5000 per month tax free if they help in the business. • The company pays 30% TAX on profits, so all costs can be deducted and pay on the net, not gross. • When you want to withdraw the profits, you can take a dividend per annum at a tax rate of 15%.

  6. Earnings • Company R 100 000 PM • Expenses R 80 000 PM, including Wife salary R 5000, two unemployed children R 5000 each who now work for you. Tax on net R 20 000 = 30% R 6000 Tax on dividend R 15% = R 2100 Net dividend withdrawal R 11 900 Tax free.

  7. Current • What could you justify currently that your not deducting for? • We are not tax specialists, but there are other things that can be structured by taking on a professional tax consultant. • The first step, own a business, the second start earning an income. • The third structure yourself to be tax efficient.

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