Wind Up Wind Down

Understanding the tax implications during sequestration in South Africa is an important part of the insolvency process. Sequestration affects more than your assets and debts — it also changes how the South African Revenue Service (SARS) administers your tax affairs. This includes your tax status, outstanding tax debt, income tax and, in certain circumstances, Capital Gains Tax (CGT). Here is what you need to know.

A company experiencing financial difficulty does not automatically make its directors personally liable for its debts. However, personal surety, reckless trading, SARS debt and certain transactions can create personal exposure. Understanding when company debt can become a director’s personal responsibility is an important first step when a business is facing insolvency.

Worried about losing your house or car during sequestration? We explain what happens to financed assets, outstanding balances and shortfalls, and how these assets can form part of resolving your debt.

What happens to personal assets during business liquidation in South Africa? Personal assets do not automatically form part of a company’s liquidation. However, if you signed personal surety and company assets cannot settle the debt, you may be personally liable for the shortfall.

If you think you don’t need a team of professional insolvency experts standing with you as your business heads towards a potential liquidation, think again. At this stage, the decisions you make can either protect what’s left of your business or make a difficult situation far worse. Consulting a professional can help you avert a calamity and reach a proper conclusion for your business. But there are more reasons why you should seek professional advice on liquidation in South

Running your own business brings freedom, but it also comes with financial risks. When cash flow strains or debts pile up, many self-employed individuals face a harsh reality: insolvency. If you work as a sole proprietor, understanding how insolvency works can help you make informed decisions and protect your future. So, what does insolvency mean for a sole proprietor or a self-employed person in South Africa?