Page 5 - Companies & Dividend Tax
P. 5

COMPANIES & CLOSE CORPORATIONS





            SBC – Definition (Section 12E(4)(a) and SILKE chapter 19.5.4)







            • Certain service industries may qualify as a small


                business corporation (20% limit for investment

                income together with income from rendering a

                personal service (note 1 below)).



            • Remember:


                    • Investment income includes income from the rental of

                       immovable property (not movable property), but

                       excludes interest earned by a co-operative bank.

                    • If a company/cc throughout the year of assessment

                       employs three or more full time employees (other than

                       a holder of a share/members or its connected persons),

                       it will not be a personal service as defined.







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