In many businesses, compliance is overlooked. Not only does this mean that your business isn’t operating lawfully, but also that there are financial implications concerning non-compliance that have far-reaching consequences. On the other hand, good compliance keeps your business in line with legal requirements and also gives you credibility by showing potential investors and customers that you’re doing business the right way.

It’s your responsibility as a business owner to ensure that your business complies with the necessary South African legal requirements.

Here’s a guide to the regulatory bodies, and their rules, regulations, and codes of practice your business must comply with:  

• Companies and Intellectual Properties Commission (CIPC)
• Department of Labour (DOL)
• South African Revenue Service (SARS)

The Companies and Intellectual Properties Commission (CIPC)

Once you’ve registered with the CIPC, and depending on the type of legal entity you register, specific legislation then applies to that entity. Compliance is maintained by ensuring annual returns are submitted and paid timeously. If you don’t do this, your company will be deregistered and you’ll lose your company registration number.

Department of Labour (DOL)

Everything to do with the people you employ and their health and safety falls under the Department of Labour. Business owners are required to comply with the DOL’s regulations to ensure their operations are efficient, their personnel’s human rights are protected, there’s no inequality or discrimination in the workplace, and workers are safe while carrying out their duties.

Some of the regulations include:  

• The Basic Conditions of Employment Act
• The Labour Relations Act
• The Occupational Health & Safety Act
• The Unemployment Insurance Fund (UIF)
• The Workman’s Compensation Commission
• The Skills Development Levy
• The Employment Equity Act

South African Revenue Service (SARS)

Business owners must register with SARS and pay applicable taxes that include but are not limited to Company Income Tax, Provisional Tax, VAT, and Pay As you Earn (PAYE). It’s wise to consult with an accountant and/or tax practitioner to ensure you have professional advice that’s specifically related to your registration.

Compliance is maintained through your Tax Clearance Certificate (TCC), and late payments to SARS incur interest and penalties.

The cost of non-compliance

The far-reaching consequences of non-compliance range from deregistration, fines, penalties and interest, and even jail time in severe cases. As such, compliance must form part of your fundamental business activities to mitigate your risk and avoid additional financial burdens.

Can we help you?

While compliance issues in public companies are managed by a company secretary, there is no legal requirement for private companies to employ someone in this role. However, many private companies retain their accountants to carry out their compliance duties because of the complexity and onerous task of remaining up-to-date with legislative changes.    

At Counteractive, we manage your monthly bookkeeping and financial reporting, and we complete and submit all your statutory returns and remind you of important dates and deadlines. We also manage your payroll and ensure your business is compliant with current employment and labour law.