Page 4 - KZN Business Sense

THE COST OF A BAD ACCOUNTANT

Heather Flack, Business to review a SARS decision The Opportunities You Never See How to spot a risky accountant any ‘% of refund’ clauses for
Leader, Flair Accounting under section 9 and even (But Pay For) (and what good looks like) routine returns.
then, a written agreement and A mediocre accountant doesn’t 2. Verify your practitioner:
he wrong professional oversight apply. just make mistakes; they miss Red Flags Check registration and
accountant legal savings: ■ ‘We charge a percentage of your professional body
Tdoesn’t If someone offers you ‘we’ll refund’ for normal return work. membership.
just cost you fees. take 20–30% of your refund’ for ■ Choosing the right regime: ■ Refunds routed to the
They can cost normal return work, that isn’t Qualifying micro businesses accountant’s bank account. 3. Confirm refund banking
you refunds, compliant. Walk away. might benefit from Turnover ■ Vague engagement letters with details: SARS should have
trigger Bottom line: A legitimate Tax; many don’t even get told it no clear roles and your verified bank account
penalties and practitioner charges transparent, exists. responsibilities; no calendar for on file.
interest, and fixed or time based fees for ■ Disputes done properly: When VAT/PAYE/CIT deadlines. 4. Request your own Tax
even break return work and ensures refunds SARS gets something wrong, Clearance Certificate: Identify
the law. Here’s how to spot the are paid into your bank account, the fix is through Chapter 9 ■ Shrugging at missing yourself if all is up to date and
risks and protect your cash flow. not theirs. objections and appeals or a documents – ‘we’ll just estimate in order.
section 9 review, not through a it’.
Why This Matters Now The Price of Messy Books risky refund commission. Green Flags 5. Set up a retention system: Five
If you run a business in Poor record keeping isn’t just ■ Amazing tax benefits and their ■ Registered tax practitioner, year document archive,
properly indexed.
KwaZulu-Natal, you’re already untidy, it’s expensive. relevant requirements like SBCT member of a recognised
juggling rising input costs, (Small Business Corporations controlling body, and happy to 6. Book a disputes readiness chat:
municipal tariffs, and, at times, Administrative penalties: File Tax). show it. Understand objections/
no water! The last thing you late and SARS can levy fixed appeals and when a section 9
need is an accountant who amount penalties every month a ■ Cash flow planning: Aligning ■ Clear, fixed/time based fees review applies.
quietly drains your cash flow return is outstanding (scaled to VAT cycles, provisional for return work; written terms 7. If you do have compliance
through sloppy work or non income). These add up quickly estimates, and payroll for any dispute only issues, fix it before it gets
compliant fee practices. This (R250 – R16,000 per month) plus submissions avoids the ‘surprise contingency arrangements. expensive.
article spells out the real world interest until you file and pay. interest bill’ that wrecks month ■ A five year record keeping
costs and what you can do right Interest: Any unpaid tax end. checklist and a shared At the end of the tax year there
now to prevent them. document vault. are only two kinds of costs: the
attracts prescribed statutory Record Keeping: Your Cheapest ■ Proactive reminders, ones you planned for and the
The Refund “Commission” Trap interest until it’s settled. Miss a Insurance reconciliations, and practical ones a bad accountant donates
If your accountant proposes deadline by a few months and By law, taxpayers must keep advice you can action next to SARS on your behalf –
you’re not just paying tax -
taking a percentage of your you’re paying for the delay. books and records; generally week. interest, penalties, and ‘oops, we
tax refund as their fee for for five years from the date a missed that deduction’. If your
preparing or ‘fixing’ your Understatement penalties: return is submitted (longer if A KZN Lens: Durban’s Cash books keep throwing surprise
return, treat it as a major red If errors understate your tax, there’s an audit, dispute, or Flow Realities parties, it’s not luck; it’s lousy
flag. South African tax practice SARS can impose behaviour specific legislation that requires Manufacturers, logistics operators, accounting. 
standards, shaped by the Tax based penalties (from it). A competent accountant and retailers around the harbour
Administration Act (TAA) ‘reasonable care not taken’ to will give you a retention plan, live or die by cash flow timing.
and the rules of recognised ‘intentional evasion’). Voluntary store documents in accessible Missed VAT inputs, overdue T: +27 (0)31 207 1572
M: +27 (0)76 555 7529
professional bodies, do not disclosure can help but only if formats, and be able to put their EMP501 reconciliations, or a E: heather@flairaccounting.co.za
permit contingency fees for you act before SARS notifies hands on supporting schedules bungled provisional estimate can W: www.flairaccounting.co.za
routine return preparation or you of an audit. within minutes. choke operations when you need
correction. liquidity most. In this environment,
A quick reality check: Quick win: Implement a
There are very limited Compare your accounting fee for simple retention system today a great accountant is a cash flow
exceptions. Contingency fees meticulous bookkeeping, with a – cloud folders by tax type and partner, not a data capturer.
may be used in formal dispute year of late filing penalties and month, with bank statements,
matters (the objection/appeal interest. The saving from doing invoices, payroll reports, and What To Do Now?
process under Chapter 9 of it right dwarfs the cost almost working papers. Future you will 1. Review your engagement
the TAA) or in applications every time. thank you. letters and proposals: Remove

WHY SUSTAINED PARTNERSHIPS ARE CRUCIAL

FOR KZN’S CLASSROOMS

s the academic year The reality is that many peri- empowerment are transformative. ongoing coaching and in the modern workplace,
draws to a close, KZN’s urban schools operate with These initiatives must focus on resources, particularly in delivered by dedicated
Aschools enter a critical persistent under-resourcing, strengthening the capacity of vital areas like digital literacy educators.
period. For learners, it’s a time making the role of the educator educators through consistent, and reading for meaning, as As the year-end provides a
of final results anticipation; overwhelmingly demanding. tailored support: we do through our enduring chance to shape the next year’s
for educators, it’s a moment of When the last bell rings in partnership with The Domino strategy, we invite the KZN
exhaustion and reflection on a December, the gaps in teaching ■ PRINCIPAL AND Foundation. business community to explore
year often defined by resource capacity, subject specialisation, EDUCATOR LEADERSHIP how moving toward multi-year
gaps and capacity challenges, and professional support do not MODELS: These are essential A Call for Greater Sustained commitments can amplify
such as the educator shortage simply vanish. for strengthening the school’s Commitment the positive effects of their
previously highlighted at leadership over the long Our partnership with investments.
Amaoti 3 Secondary. At Cox Yeats, we believe term, creating stability and The Domino Foundation
moments of year-end reflection high morale. Education is a marathon,
The closing of the school year should spur greater action in ■ SPONSORSHIP OF demonstrates that by focusing not a sprint. Investing in the
offers a clear perspective: our the New Year. We cannot solve SUBJECT SPECIALISTS: on core skills and supporting people who lead and teach in
education system’s challenges KZN’s education challenges Filling critical gaps, like the people who teach them, our schools is the most powerful
are year-round, and the unless we reinforce the backbone the maths educator crisis, businesses can achieve investment we can make in
solutions require sustained of the system: the educators and through sustained funding for measurable, lasting impact. KZN’s future workforce and
commitment from the KZN principals. specialist educators or The Literacy and Life Skills society. Let us use this year-end
business community, especially One-off donations are “Educator Champions.” programmes provide essential moment to commit to deeper,
in how we support our appreciated, but long-term ■ PROFESSIONAL reading comprehension and long-term support for our
educators. digital skills, the keys to success
partnerships that target educator DEVELOPMENT: Providing educators in the year ahead. 

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