Business – Page 4 – KRUGER & CO

Jan 06

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Before You Start a New Small Business in 2020…

By Kruger & Co | Business

“Just do it!” (Nike)

You and your fantastic business idea can’t wait to chuck up the 9 to 5 job and launch your own new venture. 2020 here we come! But is this the right time to do it?

Of course no one knows for sure whether 2020 will see our economy glide happily into recovery mode or continue bumping along in the mud at the bottom. But one of the great things about starting a new small business is that it doesn’t really matter. Provided, that is, that you plan carefully and remain agile and adaptive to whatever may come our way.

Here are some thoughts on how to get that planning underway…

1. Line up the right professional help

Quite apart from all the many legal, accounting and tax-planning issues you will face, bouncing your ideas off your professional advisers is a no-brainer here. Just do it before you put too much time, effort and money into your new venture.

2. Ask yourself “Am I an entrepreneur?”

Not everyone is suited to the cut and thrust of running a small business. On one side of the coin you can look forward to a good dose of exhilaration and excitement, but on the other you are in for more than your fair share of work-life balance challenges, risk, fear and stress. The personal and financial rewards can be enormous, but the spectres of disruption, decline and failure will haunt you at every turn (if they ever stop haunting you, something’s wrong – nothing is certain, and nothing lasts forever!).

Bring your family in on this from the very start – they will be walking this road with you every step of the way!

3. Quiz yourself online

Spend 10 minutes answering the questions in an online quiz like the Business Development Bank of Canada’s “Entrepreneurial potential self-assessment” on its website – then book appointments with your professional advisers to see if they agree (back to 1 above).

4. Decide on a business structure upfront

This is critical; the tax, financial, legal and practical issues of getting it wrong can be substantial. And whilst you can change from say sole proprietorship to a company/trust structure down the line, the consequences are best avoided. Rather get it right from the outset with professional advice (1 above again).

5. Figure out the financing

Whether you will need a lot of money upfront or not, your business idea is a non-starter without finance. First, figure out how much you will need – crowdfunding site Kickstarter has a useful planning checklist on its “Funding” webpage.

Next think about where that money is coming from. Can you finance the startup yourself; and if you can, should you? Will you ask friends and family or a bank for a loan? Perhaps you can find a rich partner or an angel investor? Crowdfunding may be worth a look – apart from Kickstarter and many others like it, consider local platforms – Google “Crowdfunding in South Africa” for a list, and read Jumpstarter’s “Crowdfunding in South Africa!” here. The State also comes to the party here – read “Where do I get assistance to establish a small business?” on the South African Government Information website for a list.

Last but not least, specific professional advice is once again a no-brainer.

6. Build a strong, dynamic team

Your staff will be the backbone of your business so whether your team will be big or small, in-house or out-sourced, management-heavy or mostly there in a support function, put your heart and soul into choosing wisely. Recruit wherever you can from diverse backgrounds and a range of specialties for a dynamic team that is agile and adaptable, and has the creativity that flows from constant cross-pollination of ideas.

7. Market, market, market!

No matter how brilliant your product or service, it is worth absolutely nothing to you until your target market pays you for it. Which it will only do if it knows what you do and how you benefit them. As obvious as that sounds a lot of startups fail for lack of planning around how to achieve the necessary exposure.

With all the marketing noise bombarding us all these days you have to find a way to be heard – prioritise marketing or fail.

8 . For a company get cracking with Biz Portal’s ‘One-Day, One-Stop’ online platform

The CIPC (Commission for Intellectual Property Commission) has just launched its “Biz Portal” online business registration platform. In collaboration with SARS, UIF, the Compensation Fund, B-BBEE Commission, the .za Domain Name Authority, and banks, the platform says it will help you register your new company in just 1 day (it normally takes 40!), plus assist with tax registrations, domain names, bank account, BEE certificate and so on.

Time will tell how effectively this (very welcome!) new initiative will actually work, but remember that by its very nature it cannot give you that essential individualised input we keep mentioning. Take professional advice as above before using this platform!

9. The bottom line: Just do it!

To quote Richard Branson: “Screw it – just do it!”

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

Aug 28

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Your Website of the Month: Video Guides to Starting Your Own Business

By Kruger & Co | Business, Website of the Month

“A journey of a thousand miles begins with a single step” (Laozi)

Many of us dream of starting up our own thriving businesses. But it’s an ambition that few actually attempt, let alone achieve, and no wonder – it’s scary going out on your own, and there are many challenges awaiting you on the long road ahead. And we all know how that first step on the road to success is often the very hardest to take.

So where to start? The Internet has a wealth of useful resources for entrepreneurs and would-be entrepreneurs. The general principles of entrepreneurship apply universally, so the American website BusinessTown, with its extensive library of easily-digestible video content, is a great place to take that first all-important step. Customise a list of videos relevant to your particular needs under headings such as –

Start a business
Run a business
Increase sales and profits
Ramp up to the next level.

There are videos there covering everything from “5 myths about starting your own business” in the “Should You Start a Business?” section to “Finding new business ideas in the everyday” in the “Hundreds of Business Ideas – Which One Is Right for You?” section.

A final thought – before you actually launch, get proper legal advice. Ask questions like “what vehicle should I choose to house my new venture?” “What formalities must I comply with?” “What agreements should I have in place?” And so on…

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

Jun 26

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Your Website of the Month: Business Email Dos and Don’ts

By Kruger & Co | Business, Website of the Month

“The email of the species is deadlier than the mail” (Stephen Fry)

Do your business emails enhance your brand or tarnish it? It’s a critical question, particularly for businesses with high email volumes (that’s most of us these days) and it’s entirely up to you what the answer is.

On the one hand it’s all too easy to jeopardise an entire business relationship by hitting the “Send” button on a badly considered, written or configured email. On the other, it’s easy to turn every email you send into a powerful projection of all the good things you want everyone to know about your business and about you personally.

Get started with “The dos and don’ts when sending a business email” on BusinessTech, a 13-point checklist of things to watch for, from “Subject Line” to “Conversation Closer”.

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

Apr 29

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Expats and Employers: Plan Now For the New Expat Tax Changes

By Kruger & Co | Business, Employment and Labour Law, Tax

“An income tax form is like a laundry list – either way you lose your shirt” (Comedian Fred Allen)

This article is important to you if you are either a South African working abroad or an employer of one. If you don’t fall into either of those categories, but know someone who does, please think of passing this on.

As an employee earning foreign remuneration (salary, leave pay, bonuses, allowances, commission etc), you currently enjoy an uncapped tax exemption (on that remuneration only, not on other foreign income) provided that you work overseas –

For more than a total of 183 days during any 12 month period, and
More than 60 of those days are consecutive.

That however is set to change from 1 March 2020, when only the first R1m p.a. of your earnings will be exempt – you will pay tax on anything over that. With the Rand’s weakness showing little sign of abating, a lot of expats and their employers are going to be affected.

Are you a “tax resident”?

Only “tax residents” are affected, so the first thing you should establish is whether you are still a tax resident or not. That’s not always easy, so take professional advice in any doubt.

To illustrate some of the complexities involved, both physical emigration/relocation and “financial emigration” are different concepts to “tax emigration”. Moreover the Income Tax Act’s tests for tax residency are hardly a model of clarity – you are a “resident for tax purposes” if you are either an “ordinary resident” or a resident in terms of the “physical presence test” –

You are, says SARS, an “ordinary resident” if South Africa is the country to which you “will naturally and as a matter of course return after [your] wanderings’, your “usual or principal residence”, or your “real home”.
Even if you aren’t an “ordinary resident”, you will still be a resident under the “physical presence test” if you are physically present in South Africa for more than –
1. “91 days in total during the year of assessment under consideration; and
2. 91 days in total during each of the five years of assessment preceding the year of assessment under consideration; and
3. 915 days in total during those five preceding years of assessment.”
  Under the physical presence test however if you are outside the country for a continuous period of at least 330 days you are not regarded as a tax resident.

Should you “tax emigrate”?

If you are indeed a tax resident, don’t think of changing that status without taking full advice. “Tax emigration” and “financial emigration” are complicated processes and full of pitfalls. For example you could be entitled to foreign tax rebates or other relief on your taxable (i.e. +R1m) foreign earnings, or there may be other benefits to remaining a tax resident. So it is important to have an expert look at your specific situation and determine what is best for you overall.

The big thing is to be aware that change is coming. Some long-range planning is the only way to be certain that there are no unpleasant surprises waiting to spring out on you down the line.

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

Mar 27

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Your Website of the Month: Music for Productive Work

By Kruger & Co | Business, General Interest, Website of the Month

“If I were not a physicist, I would probably be a musician. I often think in music. I live my daydreams in music. I see my life in terms of music.” (Albert Einstein)

Music, science tells us, really can help us work, and learn, and be creative.

Earphones mean you can listen to your favourite tunes all day with zero disruption to your fellow employees (and clients waiting in Reception!), and you’ll never be short of new music with a streaming service and a high-memory smartphone. But what should you listen to?

“Create the perfect playlist for productive work” on Quartz discusses how music can enhance workplace performance (employers take note!), and what musical tempo (beats per minute) can help induce the alpha state in your brain so that your mind becomes calm and alert, with heightened concentration.

Different types of music, it turns out, are ideal for particular tasks in four categories –

Simple tasks
Learning
Work you love
Creative work.

Happy (and productive) listening!

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.