Online digital accountant Osidon, focused on supporting entrepreneurs and small business owners through accounting/tax/payroll and company registration services, has won a huge victory for small business owners and entrepreneurs in South Africa.
Following pressure in the media from Osidon, the Companies and Intellectual Property Commission (CIPC) agreed to abolish the mandatory compliance checklist for small businesses, which came into effect on 1 January 2020.
The checklist required all companies to answer a 24-question compliance list when they submit their annual returns. This list would increase accounting fees as the average business owner does not have adequate knowledge of the Companies Act, leaving accountants to complete the list on their clients’ behalf.
When the list was first introduced, Osidon CEO and small business champion, Hennie Ferreira, said the list would first undermine the rest of the country’s drive to attract investment to South Africa.
“Overregulation flies in the face of government’s plan to turn the economy around. Investors will look at the over-regulated environment and decide to invest elsewhere,” Ferreira said.
Following a meeting between Osidon and the CIPC Commissioner, Advocate Rory Voller, and his management team, the CIPC has agreed to abolish the mandatory compliance checklist for small businesses that do not require audits. According to Ferreira, the list would have amounted to an estimated R1.2 billion in extra fees to be paid by small businesses to ensure their businesses are compliant.
Ferreira said this was a massive feat for entrepreneurs in South Africa: “Small businesses are drowning in compliance and red tape and cannot be subjected to any more regulation. Entrepreneurs and small business need to be empowered to boost our economy and create job opportunities. They need to be de-regulated and encouraged”.
Ferreira praised the CIPC for their responsiveness. “After our meeting, they agreed to abolish this new requirement for small businesses, saving SMMEs millions of rand. We fought and won a major victory for small business. I want to thank the CIPC for being open minded, approachable and eager to find solutions,” Ferreira says.