Companies

What are your terms and conditions?

They are quite uncomplicated.
  • We are a cash practice and require payment in full before we start any job.
  • If you decide that you no longer want the product/service and advise us of this before we have started on the job, we will refund your payment.
  • Except for the above, we do not give any refunds. We will, however, complete the work subject to the next condition.
  • We require that you respond promptly to our requests for information, documents or signatures. If you do not do so within 3 months of our request, we will cancel the job without notice or refund.

How long does it take after I’ve paid and given you all the required information?

  • Shelf company registration document – almost immediate
  • Share transfer – almost immediate
  • B-BBEE certificate – almost immediate
  • General Power of Attorney authorising you to act on behalf of the company – almost immediate
  • Letter stating that we are in the process of registering the change of directors – almost immediate
  • Bank account – about 4 days
  • Change of Directors - about 2 weeks
  • Name change - about 2 1/2 weeks (either before or after the change of directors is registered)
  • Workmen's Compensation Registration - about 6 weeks
  • Registration for PAYE - almost immediate
  • Tax Clearance - almost immediate if clean
  • UIF registration - about 5 weeks
  • VAT registration - about 1 week once you have done R8 400 turnover within the preceeding two months
  • CIPC Annual return - almost immediate

Why are older companies more expensive than new ones?

Largely because of their rarity value but also because we have had to submit two provisional tax returns each year plus an annual tax return and a CIPC annual return with the CIPC fees.

Why does it cost more to form a new company than buy a shelf company?

Because we form about 30 shelf companies at a time and this is much more efficient than forming one on its own. You do, however, get the name of your choice.

Why are VAT registered shelf companies so expensive?

Because it is near impossible to register a shelf company for VAT.

How does “Trading as” work?

In terms of the Consumer Protection Act, trading names have to be registered with CIPC. However, CIPC issued a notice to the effect that they do not have the capacity to register trading names until further notice. That was about four years ago. So in the meantime, you can design your letterhead to say “Xyz (Pty) Ltd trading as” in very small letters then “Abc” (your trading name) in very large letters underneath. Do not say “ABC (Pty) Ltd”. But don't forget that we'll do a name change free if you request it when you buy the company from us. We only require that you pay the CIPC fees of R300, we do the work for nothing.

Why are companies cheaper to maintain than CCs?

A CC is always owner managed. An owner managed company is not required to be audited or to produce formal financial statements each year whereas a CC must produce financials that comply with International Financial Reporting Standards and are signed off by an Accounting Officer and these are expensive.

So why are CCs so popular?

Because people are still under the misconception that they are easier and cheaper to run. This is simply not the case.

What is the difference between the four types of company?

(Pty) Ltd is a normal private company – the sort that we are all most familiar with.

NPC is a non-profit company (the old s21). You can pay yourself a salary but the shareholders cannot receive dividends.

Ltd is a public company which can offer its shares for sale to the general public (but is not necessarily listed on a stock exchange).

Inc is a professional practice that has incorporated as a company rather than a partnership. These would be typically, medical practitioners, auditors, attorneys.

Trusts

How long does it take after I’ve paid and given you all the required information?

  • Copy of original Letters of Authority – almost immediate
  • Copy of original Trust Deed – almost immediate
  • General Power of Attorney authorising you to act on behalf of the trustees – almost immediate
  • At this stage you will have enough to start using the trust
  • Registration of the new trustees – about 8 weeks
  • Changes to the trust deed – 8 weeks (concurrently with above changes)

What does a trust protect?

It protects the growth in the value of an assets from the value at which it first acquired the asset.

What does a trust protect the growth in value from?

The founder’s creditors cannot attack the growth in the assets of the trust and when the founder dies, the trust does not die so its assets are protected from Estate Duty and CGT on death (which together would have amounted to between 1/3 and over ½ of the estate if we ignore the allowances which are there to cater for personal rather than investment assets).

Can I still control the assets of my trust?

Yes, partially as a trustee who has a vote. But, technically, completely if you are the sole director of the company that owns the assets and the company is owned by the trust. However, we recommend that the director gets the trustees to agree to any significant decisions made by the director.

Trusts and Companies

When should I buy a trust and a company?

When you plan to hold investment property (i.e. property earning rental) or financial investments and to recycle the income to build the property or investment portfolio. The trust would be taxed at 41% on the taxable income so it would only be able to re-invest 59%, but if the investments are owned by a company, then it is taxed at 28% and can re-invest 72%.