Van Zyl Retief

Estate Planning: Preparing for the Digital Afterlife

The emergence of digital ghosts on social media Social media platforms have become integral to our daily lives, but what happens to these digital profiles when a user passes away? Research by Carl J. Öhman, a doctoral candidate at the Oxford Internet Institute, sheds light on this evolving issue. Öhman’s study, titled “Are the Dead Taking over Facebook? A Big Data Approach to the Future of Death Online”, reveals a startling projection: if Facebook’s growth continues at its current rate, the number of deceased users’ profiles could surpass 4.9 billion by 2100, potentially outnumbering living users​​​​​​. This phenomenon underscores the rapid pace at which digitally stored information is outgrowing the world economy, including the accumulation of what Öhman refers to as “online ghosts”​​. The legal and ethical implications As the digital remnants of deceased individuals grow, they present unique challenges in the realms of privacy, estate planning, and digital heritage. Traditional notions of estate planning are now expanding to include digital assets and social media profiles. Facebook, Twitter, and other social networks have developed specific procedures for handling the accounts of deceased members. For example, Facebook offers options to delete or memorialise accounts, allowing for tribute messages on memorial pages. Users can direct their executors to manage their digital presence posthumously, either by maintaining a memorial status or ensuring prompt deletion of their accounts​​. Social media platforms’ policies on digital legacies Each major social media platform has its own approach to handling the accounts of deceased users. Facebook’s memorialisation feature and the option to select a legacy contact provide a way for loved ones to manage the profile of the deceased. Instagram, owned by Facebook, follows similar policies. Twitter, on the other hand, does not currently offer memorialisation but allows family members to request the deactivation of a deceased user’s account. Google has an Inactive Account Manager feature, enabling users to decide what happens to their data if they become inactive for a specified period. Apple also allows users to add a legacy contact to their Apple ID, providing an access key for data retrieval after the user’s passing​​​​​​​​. Practical steps To navigate the digital afterlife effectively, it is recommended that individuals include digital assets in their estate planning. This process involves deciding who will have access to passwords and account management and specifying the desired handling of social media profiles and data. Setting up legacy contacts or inactive account managers on supported sites can greatly assist personal representatives in managing digital assets posthumously. When dealing with the closure of a deceased individual’s social media accounts, it’s important to protect sensitive information and be mindful of the content shared on memorial pages​​. Embracing our digital heritage The ongoing expansion of our digital footprints, coupled with the inevitability of human mortality, necessitates a re-evaluation of how we handle our digital legacies. As social media platforms continue to evolve, so too must our approaches to digital estate planning, privacy, and the ethical management of digital afterlives. By proactively addressing these concerns, we can ensure that our digital heritage is preserved or managed according to our wishes, reflecting the growing intersection between our online and physical existences. Reference list: https://journals.sagepub.com/doi/full/10.1177/2053951719842540#:~:text=We%20project%20the%20future%20accumulation,9%20billion https://arxiv.org/abs/1811.03416 https://www.nvrlaw.co.za/OurInsights/ArticleDetail.aspx?Title=To-Facebook-out-of-the-grave-or-not https://www.ictc-ctic.ca/articles/the-digital-afterlife-an-interview-with-carl-ohman#:~:text=Digitally%20stored%20information%20already%20grows,the%20century%2C%20outnumbering%20living%20users https://www.justia.com/estate-planning/end-of-life-decisions/planning-your-digital-legacy/ https://www.findlaw.com/forms/resources/estate-planning/how-to-handle-social-media-accounts-after-death.html While every reasonable effort is taken to ensure the accuracy and soundness of the contents of this publication, neither writers of articles nor the publisher will bear any responsibility for the consequences of any actions based on information or recommendations contained herein.  Our material is for informational purposes.

The seven myths of investing

The misguided assumptions that exist in financial markets. Myths are widely held beliefs that are mistaken as truths. For example, for long periods of time, people believed (and acted) as if the world was flat. Below are similarly misguided assumptions that exist in the financial markets that I have come across during my investment career. I have found the reality that lies behind these to be invaluable in guiding my investment decisions. Myth 1: There is no free lunch: While I subscribe to the aphorism, “If something is too good to be true, it probably is”, I believe there is one free lunch in the financial markets, the impact of which is often understated. This has often been referred to as the eighth wonder of the world. You’ve guessed it – it’s compounding. Everyone can benefit from compounding. It is not a zero-sum game, and it does not require any special insight.  The benefit of compounding can best be illustrated by the following example. If you can achieve a return of, for example, 12% a year from your equity portfolio, it will effectively double in value every six years. This means that for every R100 you put away at age 25, you will have R5 279 when you retire at 60. If you delay your savings until you turn 30, your R100 will only be worth a comparable R2 674. So, you see, it’s the last double that has a material impact on your pension savings, which means that you should start saving as early as possible to benefit from the impressive power of compounding. Myth 2: Earnings drive share prices: While this may be true in the short term, valuation ultimately trumps short-term earnings expectations. On their own, earnings do not create value for shareholders dividends do. I have seen several companies that have consistently grown earnings but at the expense of shareholder value creation, which comes from generating cash and reinvesting the cash back into the business at returns that are above the cost of capital. Sometimes it takes years for the market to recognise that the emperor is in fact wearing no clothes (i.e. earnings are growing, but not shareholder value). Myth 3: Active managers outperform the market: This is a highly contentious issue and while some managers do outperform their benchmark, they are certainly in the minority. If you look at the data over a particular year, you’ll sometimes find that active managers have done quite well.  Unfortunately, as one increases the time horizon, the statistics get worse. Over any 10-year period, you’d be hard-pressed to find more than one-third of all active managers beating their benchmark index. Investing in the market is a zero-sum game half will outperform their benchmark index, and the other half will not. After taking fees into account, roughly only half of the remaining group (i.e. roughly one quarter) actually beat their benchmark index. While there is no magic formula for beating these odds, a detailed, disciplined, and value-oriented approach to investing should swing these odds in your favour. Myth 4: You can make money in the long run by investing in initial public offerings (IPOs): This is one of the biggest myths of all time. If you look back to the 1998 IPO listings boom, there are very few companies that are still listed today. We conducted a study of all the new listings that took place in 2007. Of all the companies that were listed in 2007 and 2008, the average return they have delivered is negative 45% on an equal-weighted basis. In fact, only two companies are trading above their IPO price. With this track record, you would be much better off just investing in the JSE All Share Index rather than speculating on IPOs. The main reason that IPOs perform so poorly is that often the reason for listing is that the current owners of the unlisted business believe they can get more for the company by listing it than it is actually worth. Of course, there are some management teams that list for the right reasons and with good intentions, but these tend to be in the minority. Myth 5: Volatility = risk: As investment managers, we believe that our goal is to ensure that we achieve our client’s financial objectives by taking on the least amount of risk. In our view, the risk does not reside in share price changes, and cannot be summarised into a single number, such as the traditional measures used in portfolio management theory. The only risk that really matters is the prospect of a permanent loss of capital because portfolio management theory says nothing about the fundamentals of the companies you are investing in, their business risk, or their balance sheet risk. Myth 6: Markets are efficient: As an active manager, you would, of course, expect us to believe the equity market is inefficient. Most of the time, however, the market is probably efficient. If you view the market as a complex adaptive system, consisting of many participants all pulling in different directions, then on average prices will generally trade at close to fair value. It’s only when the market mechanism breaks down and the scale tips to either side that mispricing opportunities arise. Two examples of this over the past 25 years have been the IT bubble in 2001, and the commodities bubble in 2008. Myth 7: We can accurately forecast the future: This may seem obviously false, but many economists, analysts, and fund managers spend a large portion of their time trying to forecast the future. Many of these professionals earn large salaries and bonuses irrespective of the accuracy of the outcome of their predictions. I have seen numerous examples of analysts who calculated valuations on companies based on short-term earnings forecasts that never materialised. When the future turned out to be different, so did their forecasts and valuations. What they thought was a bargain, turned out to be a lemon. WRITTEN BY RICCO FRIEDRICH Ricco Friedrich is

Travel claims, but no allowance?

For commission-earners and the self-employed, the rules are slightly different but travel costs can be claimed. The common mistake that I make when writing articles about travel allowances is that I tend to forget that not all of us are ‘wage slaves’. Indeed, there are many taxpayers for whom the saying, “If a man will not work, he shall not eat1” is a daily reality those who are self-employed, as well as those who derive their earnings from commission. But the very fact that they don’t earn a regular salary means that they also do not receive a fixed travel allowance.  And the general rule when it comes to travel claims is: No allowance, no claim. That’s the bad news. The good news is that commission-earners and the self-employed may claim the cost of their business travel against their income under Sections 11(a) and 11(e). General deductions Section 11(a) Section 11(a), the so-called ‘general deduction formula’, provides that for an expense to qualify for a tax deduction, it must be (i) incurred in the production of the income; (ii) not of a capital nature; and (iii) in the furtherance of the taxpayer’s trade. Put in lay terms, this means that, firstly, there must be a direct link between the expense and the potential production of income. I say ‘potential’, since the courts have held that a deduction can be claimed even if no income is actually produced, provided that the purpose and intention of incurring such expenditure was to produce taxable income. Relief indeed for salespeople, who know all too well that not every call will result in a sale! Secondly, the expense may not be of a capital nature. This means that if you incur expenses that are connected with your income-earning structure (as distinct from generating a direct income flow) for example, flying to Germany to look at a machine that you wish to purchase for your business such cost is not deductible from your income. All is how-ever not lost, for costs of this nature can be added to the base cost of the asset concerned helpful for reducing your Capital Gains Tax bill when the as-set is eventually sold. Finally, the expense must be incurred in the furtherance of your trade. In other words, you need to be seriously in business. Full-time self-employed people and commission-earners can satisfy this requirement fairly readily; those who dabble in the occasional business activity will find it much harder. Having said that, the owner of a block of flats who uses their private vehicle to go and collect the rent each month will be able to justify claiming the costs of such travel as a deduction. Capital allowances Section 11(e) Because an expense incurred that is of a capital nature is disqualified as a tax deduction under Section 11(a), one would wonder whether there is any tax relief that takes into account the reduction in value of an asset over time while it is in use. The good news is that Section 11(e) allows taxpayers using assets for business purposes to claim in respect of such devaluation, or ‘wear and tear’ to use the correct tax term. The amount that one can claim varies from asset to asset, and while in practice any method can be used, SARS places its reliance on the write-off periods contained in Practice Note 19. This Practice Note lists a number of different types of assets, together with their write-off period in years. For example, a passenger vehicle may be written off over five years by claiming 20% of the cost thereof as a deduction each year. Note however that the Practice Note provides that where the asset is acquired part-way during the tax year, the write-off must be reduced proportionately for the appropriate number of months for example, if a vehicle is bought on 1 December, the write-off for the first year would be 20% of the cost, multiplied by 3/12 (being the three months of the tax year that the vehicle is owned. Putting it all together turning theory into practice (and cash) So how does this all relate to travel deductions? Unlike an employee who receives an allowance, where the tables as set out by SARS would normally be used, a self-employed person or commission-earner must base their claim on actual costs. And contrary to popular belief, there is no specific cost that is excluded. In other words, while most people would probably be aware that they may claim the cost of fuel, oil, services, and insurance, there are other expenses such as the interest paid on the instalment sale agreement, tyres, annual licence, tolls, parking even the cost of having your car washed qualifies for deduction. And here’s a tip when it comes to maintenance plans if your vehicle’s plan covers a period that is less than five years, ask the dealer to show it separately on the invoice. They may be reluctant to do so for fear that you may somehow discover how much those ‘free’ services are actually costing you, but be insistent about this. I see no reason why a three-year maintenance plan cannot in fact be written off over the three years, as against the five-year write-off period that would apply if it were to be included as part of the cost of the vehicle. As far as claiming wear and tear is concerned, remember that you are entitled to claim the wear and tear each year, provided that you actually own the vehicle (whether purchased for cash or under an instalment sale agreement). Many people get confused in this area, thinking that they can claim wear and tear on a vehicle that has been loaned to them.  Unless you are physically paying the owner for the wear and tear on the vehicle, you have not incurred this cost as an expense, and therefore would not be able to claim. The same goes for vehicles that have been leased. If you are leasing a vehicle, legally

Who is held responsible for payments lost due to cybercrime?

This is exactly what happened in Fourie v Van der Spuy and De Jongh Inc. and others. The First Respondent was a law firm and the Second and Third Respondents were practising Attorneys. The Applicant claimed payment of R1 744 599.45 from the Respondents. The First Respondent had a mandate to deal with money paid into Trust by the Applicant. The Second Respondent, upon receiving instructions to make payments via email, paid the money into a banking account belonging to an unknown third party who fraudulently hacked the email server of the Applicant and sent emails to the First Respondent containing the wrong instructions and the wrong banking details. The Court held that the nature of a trust account imposes very strict obligations on the Trust Attorney and a very high degree of care and skill is required from Attorneys dealing with a client’s Trust account.  The Attorneys could have easily avoided the situation if they acted diligently and verified the banking details before transferring money out of the Trust account. The Court held that they failed to act with the required skill and diligence and were therefore held liable to pay the Applicant. In another matter, a sales agreement was concluded between the Respondent and a car Dealership. The Respondent transferred the funds for a motor vehicle into a fraudulent account and sent proof of payment to the Dealership. He collected the vehicle soon thereafter. Neither the Applicant nor the Dealership checked that the proof of payment reflected the correct bank account number. The mistake was discovered when the funds did not reflect in the Dealership’s bank account. The Respondent raised the defence of estoppel. He held that the Dealership’s normal procedure was to release the motor vehicle after receipt of money and not just receipt of the proof of payment. He further held that the Dealership was negligent in that they failed to check that the proof of payment contained the correct banking details, which resulted in a delay that would otherwise have been flagged by the bank and the transaction blocked. Again, the Court decided in favour of the Dealership and held that a Debtor (The Respondent in this case) always bears the duty and risk when payment is due to the creditor. The new Cybercrimes Act (the Act) might bring some relief to the parties involved. The Act aims to criminalise unlawful access, use and distribution of data and data messages. It will also regulate the power to investigate and adjudicate cybercrimes. Section 8 in particular relates to the above-mentioned cases, where it aims to create statutory offences of Unlawful Access (hacking) and Cyber Fraud. It reads: “Any person who unlawfully and with the intention to defraud makes a misrepresentation by means of a data or computer program or interference with a data or computer program is guilty of an offence.” A fine and/or imprisonment of up to 5 years for a conviction of Unlawful Access is possible, and for “Cyber Fraud” the Courts have the discretion to impose a penalty appropriate for convictions under S 276 of the Criminal Procedure Act 51 of 1977. From the above cases and the many others not mentioned in this article, it is clear that the courts will not be in favour of a party that was deemed to be negligent. It is of paramount importance, when dealing with invoices and payments from an online source, to be vigilant and always have checks in place to reduce the chances of being a victim of cybercrime. References:  Fourie v Van der Spuy and De Jongh Inc and Others (2019) JOL458L8 (GP)  Galactic Auto (Pty) Ltd v Venter (4052/2017) (2019) ZALMPPHC 27 Cybercrimes Act 19 of 2020 This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

The Subdivision of Agricultural Land Act No. 70 of 1970 explained: Part 1

The subdivision of agricultural land or “farmland” is regulated by the Subdivision of Agricultural Land Act No. 70 of 1970 (hereafter “the Act”) which came into operation on 2 January 1971. Baker J, in the case of Van der Bijl v Louw, stated that the Act has its purpose in preventing the situation where farming units are created which are not economical or could be described as non-viable subunits. This prevention objective is achieved in essence by the Minister of Agriculture, Land Reform and Rural Development of South Africa, who has to give their consent before any subdivision may lawfully be effected. Section 2 of the Act will be the topic of discussion in Part 1 of this series of articles and encompasses actions which are excluded from the application of the Act. These actions include the scenarios as follows: Firstly, the application of the Act is excluded where any portion of agricultural land is subdivided in order to transfer a portion thereof to the State or a statutory body, or a transfer to the State or statutory body of an undivided share in land, or the selling or granting of any right to any portion of agricultural land to the State or statutory body. The meaning of “right” in the latter scenario is defined in Section 1 of the Act as not including any right to minerals or a prospecting or mining right, but merely a right in relation to agricultural land. The second exclusion to the application of the Act is where a person had died before 2 January 1971,which is the commencement date of the Act, and there was a consequent passing of an undivided share or any subdivision of land due to a provision in the deceased’s last will and testament or due to intestate succession where the deceased had not left a will. The third exclusion to the application of the Act is where a contract was entered into before the commencement of the Act, and such contract made provision for the passing of an undivided share in any agricultural land. The fourth exclusion is where a surveyor has completed and submitted to the surveyor-general the relevant subdivisional diagram and survey records to be examined and approved prior to the commencement of the Act. The fifth and final scenario that is excluded from the application of the Act is where a lease agreement for a portion of agricultural land had been concluded in writing before the commencement of the Subdivision of Agricultural Land Act Amendment Act, 1974 and such lease was registered with its provisions similar to Section 3(d) of the Act. Such provisions are lease contracts where the lease period amounts to 10 (ten) or more years in total, or, when consecutive lease contracts  entered into did not amount to a total time period of less than 10 (ten) years. Thus, if a person who finds him or herself in circumstances where they are dealing with the subdivision of agricultural land and such circumstances are alike with any of the five scenarios above, then the Act will not be applicable. This means that such subdivision of farmland can be effected immediately without compliance to any other conditions and/or provisions as contained in the Act. In Part 2 of the series on “The Subdivision of Agricultual Land Act No. 70 of 1970 Explained”, we shall look at actions that are prohibited in the subdivison of agriculural land or actions amounting to such subdivison and consider any available remedies. Recources: CJ Nagel “The Subdivision of Agricultural Land Act 70 of 1970, Options to Purchase and Related Matters” 2016 (79) THRHR p 276. 1974 2 SA 493 (C) 499. T Sewapa “Subdivison of Agricultural Farmland” 2016 p 1. This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

The Subdivision of Agricultural Land Act No. 70 of 1970 explained: Part 2

In this Part 2 of the series of “The Subdivision of Agricultural Land Act No. 70 of 1970 Explained”, we shall look at actions that are prohibited regarding the subdivision of agricultural land or any actions amounting to such subdivision and if there are any available remedies. Once again it is reiterated that The Subdivision of Agricultural Land Act No. 70 of 1970 (hereafter “the Act”) has its purpose to prevent the subdivision of farming units or the creation thereof, and such units not being economical in their nature. This objective is essentially achieved through the Act as the Minister of Agriculture, Land Reform and Rural Development of South Africa has to give his or her consent before any subdivision may lawfully be effected. The first three actions which are prohibited by the act are that agricultural land may not be subdivided; no undivided share in agricultural land shall vest in any other person if such undivided share is not already held by a person, and no part of such undivided share in agricultural land shall vest in any other person if such part is not yet held by another person. The fourth action which is prohibited concerns the leasing of agricultural land and the renewal of such lease. The Act states that no one may enter into a lease for which the period of such lease is 10 years or longer. Neither may the length of the lease be the natural life of the lessee and/or the life of any other mentioned person in such lease. Further actions which are prohibited surrounding the leasing of agricultural land by the lessee, is the renewal of such lease either by the continuation of the original lease or by entering into a new lease and such continued and/or renewed lease being for an indefinite period or the combined period of 10 (Ten) years. The following actions are prohibited by the Act, except where such actions relate to the purposes of a mine as defined in section 1 of the Mines and Works Act. These actions include the selling or advertising for the sale of a portion of agricultural land, whether or not the latter is surveyed or contains any building thereon. Furthermore, the selling or granting of a right to such portion is not allowed if it is: for more than 10 years; or for the natural life of any person; or to the same person if such consecutive periods amount to more than 10 (Ten) years. Section 3(f) of the Act states that no area of jurisdiction, local area, development area, peri-urban area, or other area referred to in paragraphs (a) and (b) of the definition of “agricultural land” in section 1 of the Act, shall be established on, or enlarged to include any agricultural land. Lastly, the action of giving public notice that a scheme relating to agricultural land, or any portion thereof has been submitted or prepared under the ordinance in question. Thus, if a person finds him or herself in circumstances where they are dealing with the subdivision of agricultural land and such circumstances are alike with any of the scenarios above, then such dealings will be prohibited in terms of the Act and will be null and void. This means that such actions will need the prior consent of the Minister to comply with the Act. In Part 3 of the series on “The Subdivision of Agricultural Land Act No. 70 of 1970 Explained”, we shall look at the procedure on how to apply for consent as required by the Minister. This will include the imposition, enforcement, or withdrawal of conditions by him or her, as well as any miscellaneous provisions. T Sewapa “Subdivison of Agricultural Farmland” 2016 p 1. Section 3(a)-(c) of the Act. Section 3(d) of the Act. No. 27 of 1956. Section 3(e)(i)-(ii) of the Act. This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

Passing off: When your business’s reputation is threatened

Passing off is a delictual remedy that is derived from English law and has been implemented in South African law. The most authoritative definition of passing off was given in the Capital Estate and General Agencies (Pty) Limited v Holiday Inns Inc. case (“the Holiday Inns case”) as when a person represents his business or merchandise as the business or merchandise of another person. An example of passing off is depicted in the Holiday Inns case. In this case, the Supreme Court of Appeal confirmed the High Court’s decision interdicting Capital Estate and General Agencies (Pty) Limited from using the words “Holiday Inn” in the course of, or in relation to its business, or to any business with which it is concerned or connected, in such a manner, form or context as is likely to lead members of the public to believe that such business is, or is connected with, the business of Holiday Inns Inc. Accordingly, the Holiday Inns case tells us that for a representation to be considered as passing off, one must enquire whether there is a reasonable possibility that the relevant section of the public may be confused between the businesses and believe that one business may be connected with the other. In the English Jif Lemon case, the Court determined certain factors that must be considered to succeed with a passing off claim. These factors are sometimes referred to as the “classical trinity”, namely: goodwill or reputation; a misrepresentation; and damage. South African Courts prefer the word “reputation” to “goodwill”. In the Herbal Zone v Infitech Technologies (2017) ZASCA 347 (SCA) case, it was held that in order to prove passing off, it must be proved that: the business has a reputation; there is a misrepresentation that is likely to deceive the relevant section of the public into believing that the business, goods or services of one business is that of another’s; and .there is damage, in the sense that the misrepresentation must damage, or be likely to cause damage to, the aggrieved business’s reputation. “Reputation” for the purposes of passing off in South Africa was defined in the Premier Trading Company (Pty) Ltd & Anor v Sportopia (Pty) Ltd 2000 (3) SA 259 (SCA) case. The Court held that reputation is the opinion of the relevant section of the public regarding your product. In Caterham Car Sales and Coachworks Ltd v Birkin Cars (Pty) Ltd & Anor 1998 (3) SA 939 (SCA), the Supreme Court of Appeal provided guidance on the difference between goodwill and reputation. The Court held that it is incorrect to equate goodwill with reputation. It was held that goodwill is the “totality of attributes that lure clients”. The Court further held that, in order to determine passing off, the Courts must ask whether, in a practical and business sense, a sufficient reputation exists amongst a substantial number of persons who are either clients or potential clients of the business. The Court went on to hold that a reputation must exist where the misrepresentation occurs. In other words, there must be a threat to the business’s reputation in the country or area to be sufficient to prove passing off. If you are of the opinion that another business is passing off, you are entitled to seek a court order against it compelling it to refrain from representing its business or merchandise as your business or merchandise. You will also be entitled to claim for the damage or loss sustained by virtue of the passing off. The Court concerned will consider the factors and guidelines provided in the abovementioned cases, amongst others, in reaching its decision. Reference List: Capital Estate and General Agencies (Pty) Limited v Holiday Inns Inc. 1977 2 SA 916 (A) Reckitt & Colman Products Ltd v Borden Inc & Ors [1990] RPC 341 (HL) Herbal Zone v Infitech Technologies (2017) ZASCA 347 (SCA) Premier Trading Company (Pty) Ltd & Anor v Sportopia (Pty) Ltd 2000 (3) SA 259 (SCA) Caterham Car Sales and Coachworks Ltd v Birkin Cars (Pty) Ltd & Anor 1998 (3) SA 939 (SCA) This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

What to do if you suspect credit card fraud

Anyone who’s ever had the misfortune to fall prey to credit card fraud, knows that it’s a huge hassle. If you’re running a business, you should be aware that your business may be at an even greater risk of having its financial data compromised, which can have much more serious implications compared to that of an individual consumer. Unfortunately, even the most diligent business owner can become a victim. When illegal credit card transactions are performed, it is you who suffer the consequences. Not only do you have to foot the bill, but you also have to deal with the loss of potentially valuable business. While there is no way to guarantee that your business will never be targeted by fraudsters, there are, however, several steps that you can take to minimise the damage and put yourself in the best position possible to recover if the worst happens. If you want to limit the losses and protect your bottom line, it is crucial that you act quickly and follow a responsible process, which will also improve your chances of avoiding liability for the fraudulent charges. Reducing the damages and protecting your business against further fraud The following steps can help you keep your business afloat when a card breach occurs: 1. Stop the card and notify your bank immediately Your first priority should be to contact your bank or credit card provider as soon as possible to stop the card and notify them of the suspected fraud. Many cards can be frozen or deactivated through modern banking apps. Your bank will then ask you what transactions have been made on your account, so be prepared to give them details of all transactions on the card since it was last used. If you notice any suspicious activity online, check your statements immediately so that you can provide this information. Although the bank won’t necessarily be able to track down your money immediately, they can freeze your account and make sure that no more transactions go through. 2. File a police report Contacting the police and filing a report will help establish a timeline of events and can reveal patterns or commonalities between different instances of fraud. it is important for them to have an accurate record of your dealings with them and to preserve any evidence that may be required for investigation purposes down the line. Having a formal police report may also make it easier for you to get reimbursed for any losses incurred through card fraud if the criminal is identified later. 3. Contact SARS  You will also need to contact SARS with the information obtained from the police and request for an investigation into the matter. During the investigation process, you need to make sure that you provide as much detail as possible about the fraudulent transaction and those involved. If you have any documentation, such as contracts, photographs, and agreements – provide them with these as well. It’s important to note that if you fail to report the matter immediately, it is likely that your business will be held liable for any losses when SARS conducts an investigation. 4. Inform your clients You would want to inform your business partners and clients about the situation that has occurred on your end. This way, they may be prompted to check for any fraudulent transactions made through their cards as well. You could send them a message through email, letting them know about the issue and how it occurred. Remember, being transparent is one of the cornerstones of good business practice, so it is important to disclose how the information was obtained and advise your clients on the steps they can follow to protect themselves against similar attacks in the future. 5. Tighten up your online security The best way to avoid being targeted is to ensure that your website and servers are secure. By changing your passwords regularly and keeping your online security up to date, you can reduce the chances of a hacker gaining access to your financial information. You can claim a loss if you can establish that the fraud was not caused by dishonesty or carelessness on your part. If you have been told that you are liable for charges because of negligence, including failing to protect your personal details, such as your PIN and 3-digit CVV – it is worth seeking independent legal advice before accepting this liability. 6. Monitor your accounts regularly Finally, it is advisable to check all your bank accounts frequently in order to avoid similar problems in the future. Regularly reviewing your statements and checking if everything is fine will help you identify suspicious activity faster and report it right away, which will save you a lot of time and money when it comes to repairing the damage caused by fraudsters. A scrutinising eye from your accountant every month may also help identify any irregularities in your transactions As a business owner, knowing how to deal with card fraud will save you time, money, and a lot of frustration, and having a policy of regular checks and balances can serve as a fail-safe if your security measures are compromised. This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

Avoid overworking your staff – here’s how

Everyone handles life’s pressures differently, which is no exception at the workplace. Some job-related stress may be unavoidable, such as leading a meeting for the first time, pitching new ideas to a client, or handling a difficult customer. However, as an employer, you might unintentionally contribute to your employees’ stress by overworking them, resulting in low staff morale, poor performances, fatigue, and more serious health issues. Unfortunately, many companies overlook these telling signs and act surprised when workers perform poorly due to exhaustion. If you want to avoid burnout among your staff and create an overall happier work environment, here are some causes of employee burnout, how it will affect your business, as well as solutions to prevent or fix these problems. What causes overworking? There can be many causes of overworking, but here are some of the most common practices that burn out your human resources: 1. Expecting employees to exceed the 9 to 5 Having an overtime payment policy in place could ease your conscience, but when your employees work long, irregular hours for an excessive period, it will damage their health and the business. 2. Creating a hostile work environment Being underpaid, having to endure long commutes, annoying co-workers, unapproachable managers, and unreasonable workloads can cause employee stress levels to rise. 3. Lacking growth opportunities When you’re not implementing career-advancement opportunities, incentives, performance bonuses or promotions at your company, your staff will become increasingly worried and stressed about their current positions and their future at the company. 4. Tipping the scales of the work-life balance Overloading your staff’s plates with work will force them to work overtime, leaving little or no time for family, holidays, or hobbies. Your employees will quickly notice that their lives are unbalanced, which will increase their unhappiness. How does overworked staff affect your business?  Exhausting your staff can cause several serious issues for your company, such as: 1. Productivity and work quality will decrease When your staff is overworked, their concentration isn’t what it’s supposed to be, which can lead to costly mistakes. Common examples are packing or shipping incorrect orders, deleting important files, frequent accidents while operating machinery, or an inability to serve clients professionally. 2. Employee morale will plummet It’s no surprise that your staff’s morale will take a hit when they have to carry excessive workloads in a stressful environment. When the mood in the office is down, it will cause the tension to rise even higher. 3. The company image will be diminished By rewarding overwork, you’ll likely create a culture of overwork. Personnel will feel inclined to put in more hours to cope with their workload, enabling them to earn more money. The overworking culture will become synonymous with your company and might cause issues when you’re recruiting new staff. 4. Staff turnover will skyrocket  A rise in your employee turnover rate, especially among your most talented and experienced members, is one of the most telling signs that your staff is unhappy, likely because they’re overworked, underpaid, and undervalued. 5. Health issues will arise Stress is the root cause of many health issues. When your staff is stressed due to long work hours and unreasonable deadlines, their health will deteriorate. The most common symptoms are insomnia, anxiety, panic attacks, fatigue, excessive weight loss or gain, high blood pressure, or even heart diseases. You’ll start to notice this in an increased number of leave days taken, as well as in your staff’s appearance. Tried and tested solutions to combat overworking It’s vital to have proven strategies in place to avoid overworking your staff or to fix the damage already done. 1. Lead by example When you’re in a leading role and burn the midnight oil every week, your staff will feel pressured to follow suit. By creating an environment based on trust, transparency, and open communication, your staff will feel more comfortable approaching you when they feel overworked or need more time to complete tasks. As an empathetic and involved leader, you’ll also get a better understanding of staff morale and learn more about your employees’ daily struggles. 2. Encourage a balanced lifestyle An unhealthy work-life balance negatively affects the overall wellbeing of your employees and your company’s growth. It’s crucial to spend enough time away from work, and as an employer, you can help improve your staff’s lifestyle, whether it be by implementing regular coffee breaks throughout the day and flexible hours to accommodate those commuting from different towns or encouraging them to take a day off or a long weekend now and then, and plan a proper holiday at least once a year. By respecting your employees’ need to have a work-life balance, they’ll automatically start respecting it themselves. 3. Create a caring culture If it has become normal for your staff to work after hours, on public holidays and during the festive season, something needs to change. Start by introducing one-on-one meetings with each staff member to understand their needs, goals, and expectations. These meetings can be held at least twice a year. You can also introduce a suggestion box in which staff can leave anonymous suggestions that can be implemented. Encourage your staff to give their inputs and show them that they’re taken seriously. Even though changing your company culture from overworked to caring is a long-term project, you’ll also reap long-term rewards, as the work environment will become healthier, and your staff will feel valued and heard. 4. Offer incentives Most companies with a culture of overworking don’t offer any perks apart from monthly salaries and leave days required by law, despite their employees overworking themselves constantly. A happy employee has high morale and is motivated to deliver high-quality work. You can boost your employees’ moods by offering benefits, like performance bonuses, travel and cell phone allowances, medical aid, and free health snacks (fruit) and quality coffee. If done strategically, the money spent will be recuperated through the efficiency and performance of your staff. Is a happy work environment possible? Meeting deadlines and keeping

Improving corporate image by going green

As the risks of climate change become more intense and prevalent in today’s world, businesses are feeling the pressure to adapt and rethink their business models, making sure they align with the needs of clients, employees, as well as the environment. The Main Advantages of a Green Office Why should you invest in a greener business? Well, the benefits to implementing more sustainable practices are numerous. For instance, you will be cutting down on a ton of unnecessary costs around the office, as sustainability is aimed at energy optimisation and a conscious use of natural resources. In other words, you will be saving a substantial amount on your water and electricity bills. Furthermore, creating a greener workplace will also boost your employee performance as working in a pleasant environment is often associated with better concentration and higher performance, leading to successful results, and an increase in profits. In addition, you can be sure that opting for an eco-friendly business model will also improve your corporate image and expand your client base, considering more and more people are becoming aware of the importance of addressing sustainability and care for the environment. If the above-mentioned benefits aren’t convincing enough, the possibility of obtaining tax deductions will certainly boost the business case for the deployment of sustainable business practices. What can you do to help your business become more sustainable? Establish a green team: Identify a few individuals from your workforce who are willing to form part of a sustainability committee and who will take responsibility for implementing eco-friendly initiatives at the office. The committee can encourage their colleagues to adapt their behaviours and adopt new, eco-sustainable habits. Choose to reuse: We all know recycling is a great practice, but even recycling waste has to be kept somewhere. So, ask your staff to bring their own reusable water bottles and coffee mugs, which they can reuse and wash every day. Investing in reusable silverware and cutlery is another way to reduce plastic and paper waste in the workplace. Add some green to your view: Decorating the office with plants is not only aesthetically pleasing, but it also improves the air quality, which helps people think more clearly and boosts productivity. In addition, adding a touch of green to your office setup reduces your employees’ stress levels, and ultimately creates a more comfortable and pleasant work environment. Support local: Sourcing your business’ goods and products from local vendors is a formidable way to help the environment and improve client and consumer satisfaction, as people often prefer knowing where their products are coming from and the idea of supporting small businesses. Not to mention, it’s quite a savvy financial incentive. When you choose to buy from local businesses, you are reducing miles – consequently cutting down on shipping costs and reducing harmful carbon emissions. Cut down on car journeys: As we all know, choosing to use public transport or making use of lift clubs can also help reduce emissions and pollution. Your sustainable committee can encourage employees to use greener forms of transportation, including riding a bicycle or walking to the office if they are fortunate enough to have their workplace close to home. Aside from making a positive impact on the environment, employees will also be shedding calories and improving their health and overall wellbeing. Business leaders can also consider limiting in-person meetings and enabling staff to work from home when appropriate. Choose alternative energy sources: Tired of load-shedding? Well, then it might be time to go solar. If you choose to switch to renewable energy sources, your business won’t have to rely on Eskom’s erratic power supply, and you will reduce overhead costs – all while doing your part in the fight against climate change. Tax Incentives for Saving Energy Over the last few years, a multitude of fiscal measures have been put in place to encourage businesses to switch to green energy. One of these measures has been the implementation of financial incentives. As mentioned earlier, these incentives are one of the main advantages of developing a greener business. In South Africa, the government has been using section 12B of the Income Tax Act (the ‘Act’) to support the deployment of energy-efficient technologies and practices – by businesses, in particular. The Act initially provided for a three-year (50/30/20) accelerated depreciation allowance in respect of movable assets owned by the taxpayer. From 1 January 2016, the Act was amended to make provision for the depreciation of the full cost of a grid-tied solar PV system smaller than 1MW in the year of its commissioning . This means that a grid-tied PV system smaller than 1MW can effectively be purchased by a company (if paid in full) at a discount equal to the company tax rate since there is a 100% tax-deductible depreciation allowance on that purchase. For those purchasing larger systems, the standard depreciation allowance in the year of commissioning (equal to 50%) still applies. If you are looking to invest in renewable energy to reduce your business’s environmental impact on the planet, improve your green corporate image, or simply want to save money in the long run and want to know more about depreciation allowances – contact your tax adviser for detailed information. This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

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