Ensuring that your business is fully compliant in terms of SARS’ standards can be a daunting task for any Small, Medium and Micro-sized Enterprises (SMMEs), which could be a contributing factor to the alarming number of companies with taxable income of less than R10 million closing down each year.
Research tells us that:
- There are roughly 2.25 million SMMEs in South Africa.
- Of the 2.25 million, about 652,000 are operating formally (registered, paying taxes, compliant)
- On average, 1,612 companies with taxable income of less than R10 million close down each year.
- There is a looming Tax collection shortfall of about R50bn and SARS will be receiving an additional R1bn to assist in clamping down non-compliance and combating corruption.
- As a result, SARS will be investing in Artificial intelligence to use the tax payers’ data to detect those who do not comply and make their non-compliance costly for them.
What’s clear as daylight is that in order to improve this sombre picture, it is now more paramount than ever to provide SMMEs with simple yet pioneering solutions to keep their businesses on the right side of South Africa’s arduous regulatory climate.
It is even more urgent to equip these businesses with the right tools to combat the ever-imminent threat of closing down because unlike large companies, small businesses do not have the have the luxury of dedicated departments to stay abreast of various changes in the legal and business landscape so they need to stay informed and be on top of things to avoid risks and heavy penalties.
Without a doubt, few small businesses survive these common but key reasons of failure:
- Owners trying to be Jack of all trades, even on topics that ey are not experts in, such as payroll, taxes, Human resources, accounting, etc.
- Underestimating the heaps of administrative tasks that come with running a business.
- Postponing the need to investment in systems that assist in running a business.
- Not investing in employees (Talent) who are pivotal in growing the business.
The questions that leave business owners asking themselves is: What to do in such situations? Where to go? Who to talk to?
How Ornecy is already assisting its clients:
At Ornecy, we understand the cruciality of sustainable SMMEs on our economy. Not only do these businesses possess immense potential to alleviate the country’s unemployment woes, they also can ultimately redress the crisis of a R3trn national deficit. That is why we have dedicated our resources into developing cloud-based Payroll and HR systems for small, medium and large organizations.
Some of the tools that our clients are benefiting from are:
- Payroll: Whether outsourced to Ornecy or run inhouse, the system does all the legislative calculations and creates files to upload into the Banking and accounting platforms. Production of employee payslips, IRP5 and SARS submission files.
- Performance Management: Employers are able to remotely set, monitor and measure employees’ performance against business objectives/targets.
- Business Intelligence: Organizations place more emphasis on analytics and reporting to make informed business critical decisions.
- Leave Management: Employees can apply for leave and have their managers approve/decline online.
- Organizational Charts: visually and structurally managing the company’s workforce
- Employee Documents: Electronic Employee files are easily accessible and updated
- And more
Our solutions are secure, easy to access and use, similar to logging on to a website and doing your banking. This means that business growth and expansion is no longer limited by the confinements of geography/physical presence because employees can be anywhere in the world.
We have taken away from businesses the hassle of spending on systems maintenance, big hardware investment, backups and more. We do all this for our clients and they love it.
Furthermore, we provide continuous support so as to not leave our clients in the dark.
What about the Authorities:
As we assist more businesses to digitize their admin processes, they will at the same time be able to calculate and produce compliance reports such as EMP201, IRP5, UI-19 forms, Compensation Fund reports etc.
For more information, visit www.ornecy.com
Sources: (CRA-SA, SEDA, FIN24, Business Insider)