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Regulations of opening up an investment company?

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Not applicable
Hello Simon or anyonw else who can help me, i would like to open up an investment company,i'm 22years old and currently studying Bachelor of accountancy 2nd year in Wits, do you guys know of any requlations i must comply with in regard to these or any advice on how to go about starting up my company.
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8 REPLIES 8
Super Contributor
There is a difference betweeen forming a company to make investments and forming a company to give investment advice. Which are you planning as there will be totally different rules and regulations. I presume that it is the former. Will it be a private company (less than 20 shareholders) or public unlisted company with more than 20 shareholders?
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Not applicable
Well, i want an personal investment "vehicle" for now, but plan to be a fund manangement company in future, but i have realised that it's better to act in my own capacity, as from a tax point of view i have a lot of allowances and my tax rate is lower than an entities.
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Super Contributor
If its a personal vehicle, then u better of in a CC where there is much less admin compared to a pty.
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Not applicable
Should it be a business of giving personal advice, what regulations would have to be complied with. It is a question i have always wanted to know. What qualifications etc are needed to be allowed to say charge for investment advice.
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Super Contributor
did you think of the SBC - Small Business Corporation laws on such investment vehicles? I think this could benefit ones investments, especially trading short term, less than R43k (i think) is tax-free, and 10% for anything below R300k(could be wrong on the exact amounts). So did anyone try this yet? is it possible to qualify as a SBC when trading Warrants and/or SSF's?
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Super Contributor
Werner, you don't qualify for SBC if ur sole operations are share,ssf,warrants trading and/or investing. There is a long list of specific exclusions.
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Super Contributor
can you show me where that list is on the internet?
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Highlighted
Super Contributor
Werner, you can look at the link below. http://www.sars.gov.za/it/Brochures/Other%20Brochures/Tax%20Guide%20for%20Small%20Businesses%202005%... It opens up a PDF on the SARS website. Look at actual page number 15. In short (items relevant to this discussion): Not more than 20% of the total of all receipts of the company/close corporation may consist collectively of investment income and income from rendering a personal service. OR you can read the actual Income Tax Act.
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