Right Direction Services Offered 28 Feb 10

Consulting services offered

RIGHT DIRECTION

What do we do?

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Right Direction is a consulting firm that deals with three services, namely:

Broad-Based Black Economic Empowerment (BBBEE) consulting.

Employment Equity (EE) consulting. Government Incentive consulting.

We prepare BBBEE Scorecards, EE Reports, Incentive Applications and Incentive Claims on behalf of clients.

Why use our services?


We have the expertise. Experience. Vast industry exposure. We have the necessary intellectual properties. We remove the hassle. Reduces the use of internal resources. We have the industry contacts.

Broad-Based Black Economic Empowerment (BBBEE)


What is BBBEE? BBBEE is a set of codes released by the government outlining seven (7) elements under which companies score points on a BBBEE Scorecard. The point allocation is dependant on the company size and the total points achieved determines the companies BBBEE contributor status.

A minimum of 30 points is required in order to be BBBEE compliant. Level 8 is the lowest compliant status, while Level 1 is the highest compliant status attainable.

The seven (7) elements are: Ownership, Management/Control, Employment Equity, Skills Development, Preferential Procurement, Enterprise Development, and Socio-Economic Development.

Companies with a Turnover below R5m are Exempt Micro Enterprises (EME’s) and automatically receive a Level 4 BBBEE contributor status. Companies with a Turnover above R5m but below R35m are Qualifying Small Enterprises (QSE’s) and only select four (4) elements under which they would like to be measured. Companies with a Turnover above R35m are Generic Enterprises and must be measured under all seven (7) elements.

Please note: The above conditions may change if any of the gazetted sector charters apply to your company.

Broad-Based Black Economic Empowerment (BBBEE) cont.


Verification:

As of 1 February 2010 all scorecards need to be verified by an Accredited Verification Agent in order to be valid. The Verification Agent verifying your Scorecard may not be the same company that prepared the Scorecard.

There are two possible options for obtaining a valid BBBEE Scorecard:

Option 1: Hire a company to prepare an Assisted Self-Assessment Scorecard on your behalf. This Scorecard then needs to be verified by an Accredited Verification Agent.

Option 2: Your company internally prepares a Self-Assessment Scorecard. This Scorecard then needs to be verified by an Accredited Verification Agent.

Broad-Based Black Economic Empowerment (BBBEE) cont.


We provide two services which apply to both Option 1 and Option 2:

Option 1: We prepare a BBBEE Scorecard on the clients behalf based on the information provided by the client. This option saves the client time and reduces the use of internal resources. The Fee is based on the size of the company and the number of suppliers. Fees are payable based on progression of work.

Option 2: We provide BBBEE Training to a clients. The training covers the Codes of Good Practice and includes the necessary software to prepare a self-assessment. After the training the client will be fully capable of preparing a self-assessment. The fee is R5,000 per delegate. We also offer consulting services after the training at an hourly charge of R500 per hour.

Employment Equity


We prepare Employment Equity Reports (namely, EEA2 & EEA4) on the clients behalf.

Using Right Direction saves the client time and reduces the use of internal resources.

Any company with more that 150 employees must submit an EE report every year.

Any company with more that 50 employees but less than 150 employees must submit an EE report every second year*.

Large employers must submit their first report within six months of being designated, and thereafter annually on the first working day of October.

Small employers must submit their first report within twelve months of being designated, and thereafter on the first working day of October of every year that ends with an even number.

The Fee is based on the number of employees. Fees are payable based on progression of work.

* Turnover thresholds may apply.

Manufacturing Investment Programme (MIP)


MIP is an incentive programme for manufacturing concerns. MIP aims to enhance the sustainability of manufacturing investment projects by small enterprises and to support large to medium–sized investment projects.

The benefit available is as follows:R 0 to R 5 million - 30% over a period of 3 yearsR 5 to R35 million - 15% to 30% over a period of 2

yearsR 35 to R 200 million - 15% over a period of 2 years

The benefit is non-taxable cash grant. The benefit is receivable bi annually for the duration

referred to above. The benefit is based on qualifying investment in machinery

& equipment; land & buildings; and commercial vehicles.

Manufacturing Investment Programme (MIP) cont.


The following minimum criteria must be met in order to apply:an additional investment of 35% on the cost of machinery

& equipment as reflected in previous AFS for projects above R5m;

an additional investment of 30% on the cost of machinery & equipment as reflected in previous AFS for projects below R5m (Total assets in previous AFS also below R5m);

15% turnover increase in year 1 of project;25% increase in year 2 of project;A minimum of 4 points scored for projects above R5m;A minimum of 50 points scored for projects below R5m.

Please note that applications must be submitted no later than 3 months before the commencement date

of production.

Manufacturing Investment Programme (MIP) cont.


Our service:Prepare and submit application on the clients behalf.Prepare and submit claims on the clients behalf.Follow up on application/claims and liaise with TEO and the

client. Fee structure:

The application fee is R20,000. Payable as follows:75% based on progression of work; and25% on approval of application by TEO.

A performance fee of 4-15% dependant on project size. The performance fee is based on the value of the claims and is payable on approval of each claim.

Why use us? We have the expertise and vast experience in dealing with government incentives.

Tourism Support Programme (TSP)


TSP is an incentive programme for tourism concerns. The objective of TSP is to stimulate employment and encourage geographic spread of tourism investment.

The benefit available is as follows:R 0 to R 5 million - 30% over a period of 3 yearsR 5 to R35 million - 15% to 30% over a period of 2

yearsR 35 to R 200 million - 15% over a period of 2 years

The benefit is non-taxable cash grant. The benefit is receivable bi annually for the duration

referred to above. The benefit is based on qualifying investment in furniture

& fittings; land & buildings; and vehicles.

Tourism Support Programme (TSP) cont.


The following minimum criteria must be met in order to apply:an additional investment of 30% on the cost of furniture &

fittings as reflected in previous AFS;an increase in capacity of 30%;15% turnover increase in year 1 of project;25% increase in year 2 of project;The project must meet certain employment criteria;The applicant must be at least a level 4 BEE contributor;The project must be located outside the metropolitan areas

of Cape Town, eThekwini and Johannesburg. Projects located in marginalised areas within these metros, as determined by the dti, will be eligible to apply. In exceptional cases, projects that create new market segments, which enhance product diversity within developed areas, may be considered by the Adjudication Committee.

Please note that applications must be submitted no later than 3 months before the commencement date of business.

Tourism Support Programme (TSP) cont.


Our service:Prepare and submit application on the clients behalf.Prepare and submit claims on the clients behalf.Follow up on application/claims and liaise with TEO and the

client.Fee structure:

The application fee is R20,000. Payable as follows:75% based on progression of work; and25% on approval of application by TEO.



Critical Infrastructure Programme (CIP)


The objective of CIP is to Support the competitiveness of South African industries by lowering business costs and risks and to provide targeted financial support for physical infrastructure that will leverage strategic investment with a positive impact on the economy.

New or expanding enterprises investing in infrastructure such as roads, railways, electricity transmission and distribution, water pipelines, telecommunication networks, sewage systems etc.

CIP is available to municipalities, public sector enterprises and private enterprises.

CIP is a cash grant of between 10% and 30% based on the cost of the qualifying infrastructure. Please note that the grant is taxable.

Applications must be submitted before construction commences.

Critical Infrastructure Programme (CIP) cont.


Our service: Prepare and submit application on the clients behalf. Prepare and submit claims on the clients behalf. Follow up on application/claims and liaise with the DTI and the

client.Fee structure:

The application fee starts at R40,000 depending on project size. Payable as follows: 75% based on progression of work; and 25% on approval of application by the DTI.



Steel Rebates


The objective is to promote the development of the value added steel-processing industry in South Africa as an expanding market for locally produced primary steel products, to enhance South Africa’s foreign currency earnings and increase employment opportunities.

All exporters of fabricated steel products where 20% value has been added. The rebates are based on the value of exports, currently at R135 per ton of net

steel content (VAT exclusive) provided by steel suppliers. Companies registered for VAT in RSA may receive additional rebates based on

the current VAT rate. Our service:

Prepare and submit application on the clients behalf. Prepare and submit claims on the clients behalf. Follow up on application/claims and liaise with the client.

Fee structure: The application fee is R5,000. A performance fee of 10%. A minimum fee may apply. The performance fee

is based on the value of the claims and is payable on approval of each claim. Why use us? We have the expertise and vast experience in dealing with

incentives.

Disability Incentives


Tax incentives are available to companies that employ disabled people on training contracts.

The tax benefit: A tax deduction of R40,000 on singing of training contract for

first time workers. A tax deduction of R20,000 on singing of training contract for

all other workers. The workers salary can be deducted at a rate of 175%. A tax deduction of R40,000 on completion of training contract

for first time workers. A tax deduction of R20,000 on completion of training contract

for all other workers. The training contract must be at least two years long. The training programme must be approved by SETA. Training costs can be claimed back from SETA.

Disability Incentives


Benefits to hiring disabled staff:Improved Employment Equity Report.Improved BBBEE Scorecard.Tax benefits.

Our service:We source the necessary people for the client.The staff are hired on a outsource bases through us.We prepare the necessary documentation need to

receive the tax benefit.

Export Marketing and Investment Assistance

(EMIA)


The objective of EMIA is to assist South African exporters in establishing export markets for their products and to attract foreign investment into South Africa through the following schemes: National Pavillions, Individual Participation in exhibitions, Outward Investment and selling missions, Inward buying and investment missions, Individual inward missions, Foreign direct investment and primary market research.

All applicants must be registered with the Commissioner of Customs and Excise.

The benefit is a portion of specified costs relating to:Travel (Economy class);Daily subsistence;Transportation of samples for specific events;Development of marketing materials for specific events;Exhibition costs relating to stand rental, stand design and set up

costs; andCosts of brochures.

Export Marketing and Investment Assistance

(EMIA) cont.


Our service:Prepare and submit application on the clients behalf.Prepare and submit claims on the clients behalf.Follow up on application/claims and liaise with the DTI and

the client.Fee structure:

The application fee is R1,000.An additional application of R1,000 for export license.A performance fee of 10%. A minimum fee may apply. The

performance fee is based on the value of the claims and is payable on approval of each claim.


Research and Development (R&D) - Tax Incentives

(Section 11D of the Income Tax Act)


The objective of the R&D/T incentive is to stimulate scientific research or technological research and development.

In order to qualify the research and development must be of a scientific or technological nature.

Expenditure incurred in the discovery of novel, practical and non-obvious information or devising, developing or creating any patent, design or computer program or any knowledge essential to the use of the invention, design or computer program may qualify.

The benefit is non-recoverable. Even if the R&D is unsuccessful or not financially viable.

The benefit is as follows:Deduction increased to 150% for expenditure incurred on or

after 2 November 2006.Accelerated depreciation allowance on R&D assets

(50/30/20).

Research and Development (R&D) - Tax Incentives

(Section 11D of the Income Tax Act) cont.


Our service:Prepare and submit DST application form on the

clients behalf.Prepare report on R&D/T claim, which the client

attaches to tax return.

Fee structure:The total fee is around R20,000 dependant on project

size. The fee is payable based on progression of work.


Business Planning and Business/Project Finance

Right Direction assists companies with business planning. The business plan will be dependant on the clients needs.

Right Direction helps businesses receive finance. Our service:

Prepare business plan and financial model.Prepare and submit application on the clients behalfFollow up on application and liaise with the client.

Right Direction has contacts with DBSA, IDC, ect. Fee structure:

A fixed cost for preparing the business plan and financial model.

A performance fee of 1 -15%. A minimum fee may apply. The performance fee is based on the value of the finance required and is payable on approval of the finance.


Entity / Trust / Tax registration and amendments Close corporation registration – R500 Company (Proprietary Limited) registration – R950 Trust registration – R3000 Amendments – R350 Tax registration – R1000 VAT registration – R1000 Registration as Importer/Exporter – R1000


Contact DetailsSteven Constandinou, Business

Consultant:[email protected]: +27 74 620 4526Fax: +27 86 527 5222


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Right Direction Services Offered 28 Feb 10

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