Est. 2015 · Prosperity
Run your property portfolio like a business and everything has to be in order, from the bank account to the accounting and tax. Our team keeps your structure compliant and in good financial standing, so you can enjoy your wealth while we handle the detail.
When you run your portfolio like a business you cannot afford to have your ducks out of a row. We keep your trust structure financially sound and compliant at all times.
Your trust is legally required to keep accounting records that reflect its true state of affairs. Our accountants have the expertise and the time to prepare and submit your Annual Financial Statements, and take that load off your shoulders.
Tax can be taxing. Our tax specialists handle your annual, provisional and everything-in-between returns. Unless a trust is inactive with no bank account or tax number, it must submit returns, and if yours still needs a tax number, we arrange that too.
Thanks to proper structuring your investments should no longer sit in your personal name, but you still have personal returns to file. We look after all your personal tax needs alongside the structure.
Ideally you own your properties in a property company, and that company is owned by a Holdings Trust. You then pay tax at the company rate, which is usually significantly lower than in your own name. It also suits reinvesting profits to expand the portfolio, and because a trust owns the company you can one day sell the whole company and use the conduit principle to significantly reduce capital gains tax.
Per SAICA, if income accrues to a trust and the trustees award it to one or more beneficiaries in the same year, the income retains its nature in the hands of the beneficiary. So it is not taxed in the trust; the beneficiaries are taxed in their personal capacity after income or capital-gains splitting, where higher exemptions and lower inclusion rates apply, reducing the overall tax burden.
Make sure the correct structure is in place and properties sit in the correct entities so the lowest rates apply, record every tax-deductible expense to reduce net profit, carry accumulated losses forward to the first profitable year, and maximise unrealised gains while minimising realised gains through refinancing and expansion, keeping entities just above break-even.
Section 7C is an anti-avoidance provision. It addresses a loan made by a related person to a trust interest-free, or below the official rate of interest (Repo + 1%) defined in the Seventh Schedule. That shortfall in interest is treated like a donation, and is exempt up to R100 000 per year.
The rule of thumb is that expenses attached to the performance of a business operation carried on to earn income are deductible, whether necessary for its performance, attached to it by chance, or incurred for the more efficient performance of that operation.
The donation must go to a qualifying Public Benefit Organisation (PBO) registered with SARS and entitled to issue a section 18A certificate. That certificate reflects the PBO number, donation date, both parties' names and addresses and the amount. The total claimed may not exceed 10% of the trust's taxable income, and must be made with no strings attached.
We have helped thousands of clients prosper through proper structuring and property investment. Are you ready to do the same?
