LSB2605 ASSIGNMENT 2 SEMESTER 1 2025 – FULLY ANSWERED

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LSB2605 Assignment 2 Semester 1 Memo | Due 24 April 2025. All questions fully answered. Question 1
1. Joseph runs a printer repair shop as a sole proprietor, where he services and repairs
industrial printers for printing companies. His business achieved a turnover of R2 million in the
last tax year, which was taxed as income in his hands, and his deductible expenses amounted to
R600. He is concerned that he might be paying too much tax and believes that small businesses
should not be taxed in the same manner as large businesses, especially as he wishes to spend
money on manufacturing assets in the next financial year.
1.1. Discuss the different income tax dispensations available to small in South Africa, including
the normal tax rules and turnover tax, and whether there are any requirements that businesses
need to comply with. Explain the benefits and limitations of each dispensation and provide
guidance on how Joseph can choose the best option for his business. 1.2. Explain whether Joseph will need to register as a vendor for VAT purposes, whether he will
need to levy VAT on his goods and services, whether he will be liable to pay VAT over to SARS,
and how frequently this must be done.