The Impact of Covid-19 on Small Business and Families

Irrespective of your present or upcoming health impacts of COVID-19 on your family or yourself, this pandemic has placed a strain on your household and business finances and will most likely continue to influence your income in the coming years.

Planning, prioritizing your spending, and utilizing resources appropriately will be essential to your future financial stability.

COVID-19 has had a substantial impact on the economy of numerous countries even if some household budgets have not felt the economic crunch yet.

From cancelling sports events, religious gatherings, and live events to closing the borders and airports between the various provinces and countries, international trade has been substantially disrupted.

Impact on Small Business

COVID-19 has had a substantial impact on the economy.  Has your small business been hit?  How about your household finances? How are you coping?  #theimpactofcovid19onsmallbusinessandfamilies #financialimpact #lockdown #quarantineWhile many small business owners are doing their best to pivot at this time, many small businesses have had to shut down and many more are expected to close in the years to come.

According to McKinsey, 30 million small business jobs are at risk in the United States alone – a higher percentage than at larger companies.

More than 50% of job losses will affect these industries:

  • Accommodation
  • Food Services
  • Customer Services
  • Sales
  • Construction
  • Retailing
  • Health Care
  • Social Assistance

Moreover, the danger is that loss of work affects those who can least afford it – workers who earn less and are less educated.

Impact on Major Events

With all major spot seasons and events being cancelled (NCAA tournament, the NHL, the NBA, Olympics, and MLB) have far-reaching effects, not just on the teams or employees at the venues, but also workers of agencies that rely on these events. This includes retail shops and vendors, airline companies, hotels, and taxi drivers that will have no income at all.

Travel Bans during Lockdown

The temporary travel bans announced during lockdown in some countries might appear to many as merely an inconvenience that affects their family holidays. However, it has an immense effect on many companies who are dependent on the exchange of information and knowledge that happens during in-person business travels.

Besides that, many college research trips and association conferences have been cancelled and remain so until the end of 2020.

While many companies have virtual meetings and this trend is expanding, the loss of personal income for individuals in the convention and travel industries will continue to decline for months to come.

Impact on Families

Those who work for companies that are primarily involved in the international trade have been directly impacted, with loss of incentives and bonuses, lower salaries followed by unpaid leave, or worse, temporary or permanent employment losses.

With the economic recession that most countries are facing, higher unemployment figures can be expected. Some individuals may still have employment but at a lower salary.

There is some relief given to agencies that do provide support, for instance, the Donald Kasdon T1 Payments initiative that donates to non-profit institutions like Safenest Las Vegas who are helping residents, clients, and families during this time of isolation.

Sadly, domestic violence has increased during lockdown and Safenest provides shelter and crucial necessities like disinfecting wipes, diapers, hand sanitizer, body wash and other essential toiletries for babies, teens, and adults. They also raise awareness about problems that arise in the home during this difficult time.

COVID-19 and School Closures

Many households have been affected with schools closing due to the COVID-19 pandemic. School-aged children are at home full-time. While most households today are reliant on two incomes, this has become a major headache for parents.

Most parents are still left with having to pay school fees plus additional day-care if both parents are still working. Some parents are forced to take paid time off because they have no other choice.  This, in turn, impacts business.


The COVID-19 virus has spread with distressing speed, impacting millions of people, resulting in an almost complete financial standstill when countries imposed strict limitations on movement to prevent the spread of the pandemic.

As the human and health toll increases, the economic impairment is evident and epitomizes the most significant shockwave the world has had in many years.

Only time will tell when this virus will be contained and how long it will take countries to recover from the financial shock it sustained due to the pandemic.

How has the Covid-19 pandemic impacted your small business or home life?  How are you coping?  Do you have a pandemic-proof business or are you afraid you might lose your business over the coming months or years?

9 Pieces of Advice for Investment Trading

If you’ve read this blog before, you know the value that is put on being a top earner, especially when it can be done all online, from the comfort of your own home.

It can be easy to think that if you really want to “make it” that you have to put in years and years working for a corporation in which you slowly climb the corporate ladder.

Sure, some people obviously do find a lot of success in that, but it takes decades, and for much of that, you’re earning a lot less than you could be, and working longer hours than you need.

If you want to work remotely, while still being a top earner, one way to do this is by investment trading.

Below are resources, tips, and advice on how to make the most of your online investment trading so that you can be knowledgeable before dipping your toes into the waters of investment.

Resources, tips, and advice on how to make the most of online investment trading before dipping your toes into the waters of investment. #InvestmentTrading

1. Brush Up on Investing for Beginners

Check out this earlier blog in which the basics of investing for beginners is discussed.

2. Read the Top 10 Books

Available online are multiple books that can help you narrow down what kind of investment trading you would like to do. Investopedia has a list of top 10 books you should read before investment trading, but many are fairly outdated when it comes to online trading, so take that into consideration when reading them.

3. Budget

Set a daily, weekly, and monthly budget.

4. Source the Best Tools

Use tools that make it straight-forward to invest; if you’re a PC user versus an Apple-fanatic, the tools you use may differ. Check out metatrader 4 for mac.

5. Source the Best Apps

Check out various apps, and if you’re a beginner, use a straight-forward no-fee app to begin with, such as Nutmeg. This is great for a long-term stock investment, but if you’re keen on day trading, you may want to opt for something like Ameritrade or Robinhood.

6. Detach

This is a tip that you need to absolutely abide by, and every professional broker will agree with it. Leave your emotions out of it. If you tend to be a highly emotional person who makes judgements based on the heart, day trading is not your forte.

It can be scary to see a stock plummet, but if logic says it will recover, you’ll need to be aware of that. Don’t use emotion when purchasing or selling stocks or options.

7. Be Present

Investment trading is not something to necessarily set it and forget it. You need to be able to have time set aside for it, especially if you wnat to consider short-term day trading.

8.  Start Small

Invest in just a couple of stocks when you are a beginner trader, and focus on learning how a stock traditional increases and decreases.

9. Listen to Earning Calls

If you are only investing in two or three stocks, it should be pretty easy to keep track of when each of their quarterly earnings calls is.

Additionally, listen for specific information in each earning call to help influence your decision on the stock.

Here is a short YouTube video on what to pick out of an earnings call.

If being a top earner is important to you, don’t think that you need to put in 12 hour days at the office, five days a week.

You can make a great income, all while working remotely, for yourself.

Image Credit:  Pixabay

Are you considering becoming an investment trader?  Which of these tips is your favourite?

How to Clear Credit Card Debt with Cobalt Advisors

While it is human to want to do something to fight or flee in the face of a dangerous threat, doing nothing in the face of historical volatility can be a challenge.

But you are not alone in this.

As the world grapples with the personal and financial constraints of the coronavirus pandemic, financial advisors are figuring out how best to help their customers affected by the health crisis and resulting economic devastation.

Cobalt Advisors Offers Finance Support When You Need it Most

It can be difficult to find and meet a financial advisor face to face, especially in times of crisis when it can be crucial to get help with money. This is why many financial advisors have switched to digital platforms to meet new clients, and digital tools allow advisors to stay in touch with their clients.

As businesses closed their doors and lay-offs spread across the country, finance firms like Cobalt Advisors have launched online campaigns to offer free personal financial advice to anyone struggling with the effects of the coronavirus pandemic.

As the world grapples with the personal and financial constraints of the coronavirus pandemic, financial advisors are figuring out how best to help their customers affected by the health crisis and resulting economic devastation.   Here's how a firm like Cobalt Advisors can show you how to clear credit card debt.   #howtoclearcreditcarddebt #sponsoredpost #cobaltadvisors #howto #debtmanagement

Here are 3 ways to clear credit card debt during this trying time.

1. Debt Management Plan

In the midst of a pandemic, consultants create fresh financial plans for a new client and help the client cope with the effects of the coronavirus pandemic.

With a debt management plan, your credit advisor can reduce the number of payments you have to make each month.

In addition, they can negotiate with your creditor to:

  • reduce the payment amount
  • reduce your interest rate, or
  • reduce your overall balance sheet.

Then you can pay the credit counselling organization a recurring monthly amount that it will distribute to your creditors.

By pooling your payments, you save yourself time, money and potential frustration and reduce your credit card debt.

If you really want to tackle your credit card debt, you should consider this method to get to your destination faster. Concrete repayment targets and strategies will help to keep them in check.

If you have difficulty paying your current bills, lowering your monthly payment obligations can be a big win for your budget.

2. Consider a Personal Loan 

If you have high-interest credit card debt or have difficulty coping with multiple credit card payments, a personal loan is a viable option.

You can use the money you receive from your personal loans to repay your outstanding credit card balances. If you add new debt to your credit card, you risk digging yourself into a hole that you will have to climb out of later.

Deciding to apply for a personal loan can help you combine your credit card payments into a monthly payment.

If you have a good or excellent credit rating, it is possible to obtain more credits than you currently have with your creditors. When purchasing personal loans, care must be taken to compare the interest rates, terms and conditions of the loan and the associated additional fees and penalties.

Many personal loans offer flexible repayment terms that can help you choose a loan that suits your budget. Although you do have to pay interest, personal loan rates tend to be lower than credit cards, which can still help you save some extra money.

Some lenders also offer pre-qualification or pre-approval applications, which allow applicants to see if they can qualify before applying.

Consumers often use this option to afford higher expenses, such as debt consolidation or home renovations.

Financial Institutions will look at your income, level of education and other factors as well as your creditworthiness.

3. Fixed-Rate Loans

One way to deal with your debt quickly is to use a form of credit card debt consolidation. You can take out a fixed-rate debt consolidation loan while paying off your debt.   Usually, these offer fixed interest rates that can help with your budget because your payments stay the same while you repay the loan.

Get in touch with your creditors to negotiate payment terms with them and push for lower minimum payments and lower APR (annual percentage rate).

You are Not Alone

And remember, you don’t have to do this alone.  Debt regulators and debt relief firms are helping consumers settle or modify their debts with creditors.  And non-profit credit counselling organizations are there to offer money management counselling and help consumers develop a budget, create a debt management plan and identify the primary cause of debt.

Wishing you all the very best as you pinpoint your primary cause of debt and create the perfect budget and debt management plan to finally clear your credit card debt forever.

This post was sponsored by Cobalt Advisors. This is one of the ways I monetize my blogs. 

The Best Way for a Novice to Invest in Silver

What is the Best Way to Invest in Silver?

There are many different ways that we can invest our money for our futures and those of our family, and they all have different levels of risk.

If you are looking for an investment vehicle that can offer stable returns and is protected from inflation, then silver is an excellent investment option.

Below you will find out the information that you need to start saving for your future by investing in silver.

If you are looking for an investment that offers stable returns and is protected from inflation, then silver is an excellent option.  Here's how to get started. #bestwaytoinvestinsilver #investingInvesting in Silver is for Everyone

A significant benefit of investing in silver is that it is something that almost anyone can start as the price of silver is much cheaper than other precious metals, such as gold or platinum.

Silver is an affordable precious metal, and it is also easy to buy silver bullion to get you started. Many companies sell all types of silver for investment, and the only difference between all of them is the commission and other charges that they have.

The Practical Investment that is Easy to Liquidate

If there comes a time when you need to liquidate a small part of your investment, then silver is much easier to sell for a small amount of money than other precious metals.

With the price of gold and other metals much higher than silver, you may find it not as easy to sell the amount of metal that you need to cover your expenses.

Selling the same amount of gold, although simple, may mean that you have to sell more than you want to.

Related:  Asset and Wealth Management Advice for Expats

Silver Can Outperform Gold

Something that many people do not realise is that silver can outperform other precious metals such as gold when there is a bull market.

A bull market is where the value of commodities and stocks and shares increases, steadily going upwards during a set amount of time, just as a bull thrusts its horns up in the air.

The opposite of the bull market is a bear market, which just as with a bear’s paw, swipes downwards, meaning the value of stocks, shares and commodities decreases.

Industrial Uses for Silver is Increasing

There is only a finite amount of silver available in the world, just as with gold and other precious metals. The industrial uses for silver are increasing every day, which means demand also increases.

By investing in silver early, you can watch your investment grow as demand also grows. Silver is used in many different ways, including in jewellery, medical uses, and there are also uses in electronics, solar panels, and batteries.

What You Need to Consider before Investing

There are some considerations that you will need to take account of before diving in and investing in silver. As with other precious metals, it is only worthwhile investing in physical metal, rather than paper silver, and this means that you will need somewhere to store it.

Whether you use the services of a bullion company to store your investment, or you install a safe in your home, these are other expenses you will need to cover when you first get started with your investment.

You will also need to consider the different charges and commissions that each dealer has.

Taking these factors into consideration, silver is still an excellent investment, and if it is something that you have not considered before, you may wish to look into it further.

This post was published in partnership with MediaBuzzer.

Pin Image Source: Freepik

Getting Out of Debt Faster with Polk Partners

Making the decision to get out of debt is already a step in the right direction. You’ve set the tone towards planning a better financial future.  Generating a repayment plan can keep you focused and will help to motivate you even before you start to notice real progress.

Besides, paying off more towards a singular debt at a time can significantly speed up the process and before you know it your debt will start disappearing before your eyes.

Have a look at these five steps for setting up a repayment plan.

Making the decision to get out of debt is already a step in the right direction. Here are 5 top tips for getting out of debt faster. #personalfinancetips #gettingoutofdebtfaster #debtrepaymentplan #budgeting #sponsoredpost #polkpartners

5 Tips for Setting up a Repayment Plan and Getting Out of Debt Faster

Sponsored by Polk Partners

1. Draft a List of all Your Debts

Before creating a strategy, it’s useful to know exactly what you’re owing.

The list must entail your minimum monthly payment total, interest rates and the entire amount that you’re owing.

Make a list of personal loans, credit cards, mortgage and student loans (if applicable).

Also, include any monies that you owe to friends and family.

Try to save a small amount towards an emergency fund to avoid using your credit cards again.

2. Rank Your Debts

Decide which debts you’d like to pay off first, preferably those with the highest interest rates.

Some people pay off smaller debts first to start gaining momentum to pay off the bigger ones.

The decision is ultimately up to you, just remember to stick to your decision once you’ve begun.

3. Locate Money to Pay off Debt with the Help of Polk Partners

It can be incredibly useful to try and find extra ways of boosting your income to pay off the debts faster.

Maybe consider cutting back on certain areas like social activities to have extra money that can be allocated to certain debts. It helps to set up a strict budget and stick to it.

Using extra money from tax returns, bonuses or monetary gifts and applying it to paying off debt faster can also go a long way.

Some people look into financial offerings from institutions with once-off monthly fees and low-interest rates to help them with settling debt faster.

4. Focus on One Debt at a Time

Try to emphasize on paying off the debt that appears on the top of your list first. Allocate a larger amount towards this and only pay the minimum payable amounts on the other payments.

This way you’ll be paying more towards the principal balance and less on interest.

Once the first debt on the list is paid off, start moving towards the next and continue the process until all the debts are crossed off your list.

Once you’ve gained momentum, you’ll be amazed at how quick your debt starts disappearing.

5. Building up Savings

When you’ve accomplished paying off all your financial obligations, it’s time to start emphasizing on building a savings account. This can assist with falling into the debt trap again in future.

An emergency fund can help with paying for expenses that are out of your control and avoid getting yourself into financial trouble again.

If you must use your credit cards again, try using them responsibly and paying them off as quickly as possible.


Thank you for reading our tips on setting up a repayment plan and getting out of debt faster. We trust this post was insightful and will help you plan smarter financially for the future.  Wishing you all the very best as you work towards paying off your debt.

Good Strategies Behind Making Money From Properties

There is a lot of money to be made all over the world, yet there are only a handful of people who go and chase it. Most people settle with the jobs they have and the standard money that it brings in.

There are some people who are so career hungry that they chase more money and progress to higher roles. But the problem with this is that you’re always working for something that someone else wants you to do.

There is only so much money you can make when you’re working for someone else, and there’s only so much fun that you can have when doing it. Often, people get to the top of their careers and spend their time completely miserable because of how much work there is to do.

So, rather than letting you feel like that, we’re going to show you how there is plenty of money that can be made through property around the world. Whilst it might not be enough to allow you to leave your day job, it’ll give you a financial boost either in the short term or in the long term.

All you have to do is keep on reading to find out what you can do with property around the world.

Are you ready to start investing money into the property market? Here are some good strategies behind making money from properties. #makingmoneyfromproperties Long Term Investments

Sometimes you have to play the long game with your investments, and there is one big long game that suits property investments. All you have to do is secure a deposit on a location such as the Meriton Apartments, and then rent it out.

The reason it’s so long term is that you need to wait until you have rented it out for long enough to be able to sell it again when the mortgage is paid off. Think of the profit that you would have made on the property if you can find a way of being able to do this.

Property Flipping

Property flipping is an art that’s hard to master, and is often one that people are too fearful to get into. It’s the process of taking a run down home and turning it into something amazing that can be lived in.

The potential to earn a lot of money through this is high, you just need to make sure you pick the right home. A lot of it is to do with location and the amount of work that needs doing. There is no point going for a completely derelict home in a run down area and turning it into a palace, the potential to earn bigger amounts just won’t be there, and you may even find that you lose money.

You need to find a prime location and a home that’s looking a bit worse for wear. Put a deposit down on it only once you have figured out the renovation costs and the resale value it would hold. You then sell it on and make a profit on everything you’ve spent. But you need to have that initial pot of money to invest first of all.

Are you making money from properties? What’s your favourite strategy?  

What’s the Next Step in Your Accounting Career? (Infographic)

Becoming an Accountant takes dedication to learn what you need to know, explore the available certifications, and gain the experience that you need. When you’ve been working as an accountant for a while or even if you’re newly qualified, you should think about where you’re taking your career.

What’s the next step that you should take if you want to take your career to the next level?

Find a Niche/Specialism

If you haven’t already, choosing a specialism or niche to work with can be a smart way to take the next step in your career. It can help you to develop skills and knowledge that are in demand, and you might be able to choose a career path that allows you to earn more.

Become a Freelancer

Once you have some experience in accounting, you could also consider being a freelance accountant. Working as a self-employed accountant means you can have control over who you work with and what services you offer. It can also mean putting in a lot of work to find clients, but many of your clients will be repeat customers who need regular support.

Get a Master’s in Accounting

If you want to level up your education, a master’s degree could help you to build on your knowledge. It could present a variety of career opportunities for you, and help you to earn more money if you’re looking for a way to improve your earning potential. You can even gain your degree online if you want to study around other commitments.

What's the Next Step in Your Accounting Career? (Infographic) | UAB MACC Level Up FINAL Compressed 5.30.19
Infographic Design By University of Alabama Birmingham

Tips and Strategies for Buying Physical Gold Bars

Purchasing physical gold might be easier than you may have thought. If you are just starting out the journey, then you may be attracted to the security and associations behind owning tangible gold and the wealth or freedom it can bring.

Tips to Buying Gold

There are so many benefits to buying gold online, not to mention its robustness in the unlikelihood of economic collapse. Gold holds its own value no matter what so reading more about how you can turn this investment goal into a reality is a great first step.

Want to buy gold bullion? Discover the best ways to do it.

Where do you invest your money? Have you considered buying gold bullion? Here are some tips and strategies for buying physical gold bars. #tipstobuyinggold #howtobuygold #buyinggoldbullion

The Process of Buying Gold

Purchasing gold is pretty simple and straight forward. All you need to do is find a reliable and trustworthy website or source to purchase gold bullion and know exactly what you want to buy in terms of weight, quantity and budget.

If you are planning to purchase in a bigger amount, it’s worth shopping around for the best deals as retailers will give discounts for buying bulk.

If you want to buy gold Brisbane retail specialists offer, we suggest reputable stores such as City Gold Bullion who have been operating for decades and have plenty of trading experience. You will be able to buy gold bars and sell your gold if and when you feel the time is right.

Here are a few starter-pack tips we have put together to help you on your way:

Only Buy Pure Gold

You want 99% pure gold, if it’s any less then the mixture of other metals will be too high and make your investment questionable and not as valuable as it could be. You should see a stamp on the face of the bullion saying ’99.99% of pure gold’.

Understand Differences Between Bars And Coins

Even though every form of pure gold will have great value, they aren’t all equal for investment.

If you are hoping to invest, then it may be best to avoid gold coins and go straight to bullion as it is higher of value historically and more attractive for ROI.

You’ll also find that gold coins also lessen the value of an investor’s portfolio, so it’s best to stick to bars if you’re planning to convert the gold to cash over the long term.

Remember to Research

Shopping around is a key part in the bullion buying process as you want to get the best price for your gold.

Finance websites that give stock tickers will normally show you the fluctuations in the prices of gold on a daily basis.

Even though gold is fairly simple to buy and in demand, you want to always research before purchasing. This is because the prices will vary massively and if you aren’t careful, you could be getting much less than what you bargained for.

Where do you invest your hard-earned cash?  Have you ever considered buying gold? 

This post was published in partnership with Mediabuzzer.

Featured  Image Source: Unsplash         Pin Image Source: Pexels

Lessons in Debt Collection – Pacific Collection Group

Transitioning from consumer to business owner is an interesting path. There are so many things you don’t think about when you first start out as an Entrepreneur.   One of those things for me was debt collection.

Debt Collection – the Flip Side of Debt for Business Owners

I knew about debt from a personal perspective -from the consumer’s perspective.  I lived through the pain of being deep in credit card debt and I know just how long it took me to climb out of that hole.

What I hadn’t thought of, until today, was that one day soon – when I start selling more digital products, when I create a membership site, I may have customers owing me money – who can’t afford to pay.

As a business owner, debt collection can become a thing. 

Debt Collection Assistance

This post was sponsored by Pacific Collection Group, specialists in managing and collecting debt for businesses. Their goal is to simplify the financial settlement process in order to improve financial stability for both the business and the consumer.

Keeping it Simple – Cash Upfront

I’ve always loved the idea of simple transactions in business.

I started out in business as an Aromatherapist.  My clients were wealthy – most of them could afford to have a treatment once or twice a week.

My payment plan was super simple.  Clients paid me upfront for 8 treatments in order to get a discount.

It was a win-win.  They got a great deal and I got assured monthly income.

Cash upfront vs Accounts

The first time I discovered how damaging it can be to move away from the cash upfront model was a few years later when I was Head of Network Marketing.

The company had started out purely as a Network Marketing company but at this stage of their business journey, they had chosen two routes to market their nutritional supplements.

One was through Network Marketing (my division).

This was a pure cash upfront model and marketing was free because it was by word-of-mouth.

The other was through Retail.  The Retail division sold products to Wholesalers, who in turn sold into Pharmacies and Health Shops, who in turn sold to customers.

Margins were small and income was slow because the wholesalers insisted on paying in 30, 60 or 90 days.

Reaching the end consumer became an expensive exercise because most of it was above-the-line advertising – TV, Radio and Print Media.  What made matters worse was that it took months before we knew the results of these marketing efforts.

If there was little to no pull-through in the pharmacies, some of the stock would come back months later from the wholesalers, in damaged containers, close to expiry.

Moving over to Retail was one of the main reasons this company went into liquidation. The cash side of the business couldn’t cover all the costs of maintaining the retail side of the business.

Big lessons learned in this business and not an experience I would ever want to go through again.

How do you handle debt collection in your business?     These are lessons I've learned in debt collection over the years.     Post sponsored by Pacific Collection Group.     #DebtCollection #DebtCollectionAssistance #PacificCollectionGroup

Debt Collection in My Online Business

Back to the present and my business as a Digital Entrepreneur.

As I plan out my strategy for my online business, I am mindful of these important business lessons.

So far, debt collection in my business has been straightforward. I’ve mostly sold freelance services (sponsored posts and content writing) and been paid per job as I complete it.

There’s been the odd slow payer here and there and one customer who requested a refund on Paypal (a story for another day) but mostly payments have been almost instant or on-time.

The huge benefit of a digital business is that there are no physical products and therefore no returns and no consumable goods that can expire.

The problem with this model?  I’m still being paid by the hour.  There’s no passive income.

Which is why this year, I’m focusing more on Affiliate Marketing (write one post or create one video that goes viral, get paid for life).  I don’t handle the debt collection in this model, the Affiliate Marketing company pays me once they know their payment is secure.

I’m also trying my hand at Dropshipping (eek, physical products!) but again, the Dropshipping company handles the debt collection and returns (not me – yay!).

And planning to develop and sell my own digital products – online courses, virtual summits and ebooks. This is where I may need to some debt collection savvy.

How can I keep things simple?

Can I stick to either cash or upfront payments?

Is there a way to generate guaranteed monthly income as I did in my Aromatherapy business?  Is a membership site the answer?

Do I have a 30-day refund policy?  And if so, how can I keep refunds to a minimum?

These are the questions I will keep top of mind this year.

How do you handle debt collection in your business?

Thanks to Pacific Collection Group for requesting this sponsored post and inspiring me to think all this through.

*Writing and publishing sponsored posts is one of the ways I earn income online. All opinions are my own.

Taking the Stress out of Selling Online and Sales Tax

I’m busy setting up my dropshipping store at the moment. Having such fun choosing products to sell. One thing that never crossed my mind until today, though, was Sales Tax.

Actually, I’ve been selling online for a while and it never occurred to me to charge Sales Tax on the products and services I sell in my shop. Not until I was asked to write this sponsored post on Sales Tax Compliance, which sent me into deep research mode.

Well, let’s be honest… at first, it sent me into a flat panic.   Eek!

Then I did the research and figured out that I don’t have to stress about this, at least not yet –  not when I’m just starting out with an online store (and dropshipping on a small scale).

It’s not that I mind paying tax, it’s just that it’s so much work figuring out how much to pay, which is why I outsource this kind of stuff to a good Accounting firm.

So I guess this would be a good time to add a disclaimer:

I’m not an Accountant or a Tax Consultant, I’m a Digital Entrepreneur. All the information below is from my perspective as an online business owner who’s about to become a drop shipper.

If, after reading this post, you are still in doubt about whether you are liable to pay Sales Tax or not, I recommend you get a sales tax audit.

Here’s what I uncovered in my research.

Let’s start by drawing a line between Income Tax and Sales Tax.

What is Income Tax?

Income tax is the money you pay to the government on your taxable income.

We all know (as business owners or employees) that we have to pay income tax and, of course, I’ve been doing that.

The way income tax works is you pay tax to the government of the country you live in, no matter where your customers are in the world or where your income is derived from.

Do I have to pay Income Tax as an Online Seller?

Generally, the answer is yes – especially if you have an online business.

Most countries have a tax threshold, which means that you only have to register to pay income tax once you earn a certain amount annually.   However, earning foreign income may have different tax implications.

South African Income Tax

So in my case, I live in South Africa, I’m a Sole Proprietor and am registered as a Provisional Tax Payer.

I pay provisional tax here in South Africa on the profit I make as a business owner, even though most of my income comes from the USA, UK and Australia.

I convert all my income into Dollars (USD) before I transfer it from Paypal and then it’s converted into Rands (our currency) when I transfer it in my South African bank account. Then I work out my income tax based on the Rand value of my business earnings less my business deductions.

Twice a year I submit Provisional Tax and once a year I submit an income tax return (so far there’s been no money to pay out on the income tax return because it’s been covered already in Provisional Tax).

Who is liable to pay income tax in South Africa?

In South Africa, the income tax threshold for 2020 is R 79,000 a year for people under the age of 65 and R 136,760 for people over the age of 65.  If you earn less than R 500,000 a year (from one employer), you don’t have to submit an income tax return.

However, there are a couple of important considerations.

1. If you receive income from many sources (not just one employer) you have to register to pay tax.

2. If you receive income from outside the country (remuneration for foreign services rendered), you have to submit a tax return (even if you’ve earned less than R 500,000).

So in my case, I’m liable to pay income tax on both counts.  I earn from multiple sources and I earn foreign income.

What are the Tax Laws in my Country?

It’s really important that you research the tax laws in your own country of residence because tax laws differ from country to country.

In America, for example, the tax laws even differ from State to State.  US residents pay Federal Income Tax to the US Government as well as State taxes in some States.

Do you have to pay sales tax as an online seller or dropshipper? The short answer, not when you're first starting out. The longer answer in this post. #sellingonlineandsalestax #dropshipping #ecommerce #salestaxcompliance

What is Sales Tax?

Sales Tax is the tax placed by a Government or a State on certain goods sold.

If you’re selling products or services, some governments and some States in the USA request.

In the UK and South Africa, it’s called VAT (Value Added Tax), in New Zealand and Australia, it’s called GST (General Sales Tax).

Some States in the USA are Sales Tax Havens.

Do I have to pay Sales Tax as an Online Seller?

Most dropshippers don’t have to pay sales tax when they purchase goods from a manufacturer, wholesaler or dropshipping supplier.

in the States, when you buy something for resale, you qualify for a sales tax exemption but to take advantage of this, you need to apply for an official exemption license (or resale certificate).

Do I have to charge Sales Tax as an Online Seller?

Here’s where things get a little complicated, but let me just say, right off the bat, that in most cases you will not have to charge sales tax when you’re first starting out as a Dropshipper.

If, however, you build a very successful online store, you’ll probably be liable for sales tax (just as any other store owner).

Sales Tax Regulations

Again, sales tax regulations differ country by country but I’m going to focus on the USA (as that’s where most of my audience is) and South Africa, as that’s where I live.

Do I have to collect and pay Sales Tax in the USA?

Before June 21, 2018, when the Wayfair Act was passed, you only had to collect tax from your customers in the United States if you had Nexus in a State that levied sales taxes.

What is Nexus?

Nexus is a legal term meaning you have a sufficiently large physical presence in a State that requires you to pay sales tax.  For example, if you live in the State or have an office property in the State.

So for dropshippers who don’t live in the USA, like me here in South Africa, or someone in the UK, Australia, Europe or anywhere else in the world, this means we were not required to collect sales tax from US customers or pay sales tax in the US.

What is Wayfair Nexus?

However, there was a new Supreme Court ruling on 21st June 2018 known as the Wayfair Ruling.

The new law says that Sales Tax Nexus can be applied if you don’t have a physical presence in a state but are making $100,000 in Sales or making 200 Sales in a State.

Which means that any US State can now require that remote retailers collect and pay sales tax. Fortunately, most States have not passed this legislature.

For now, if you’re new to dropshipping, sales tax will not apply as this bill was aimed mainly at large online retailers.

Mostly, you’ll only have Nexus if you live in a State or have property in it and the law is not going to affect you until you start making lots of money.

If you’re confused by any of this, I found a brilliant video on YouTube by Sarah of Wholesale Ted.

Do I have to collect and pay Sales Tax in South Africa?

So my next question, of course, do I have to register as a VAT vendor and start charging VAT?

Yes and No.

If you own an online store, and South Africans buy products from your store, you have to charge 15% VAT on all VAT-able products.   However, you don’t have to charge VAT if your customers buy from anywhere else in the world.

Yet again, the answer for me is no, for now, because I don’t have to register as a VAT Vendor until I’m doing over R 1 million in sales a year.  I’m guessing that’s going to take a while.

So what I discovered in my research is that I’m in the clear when it comes to Sales Tax, for now.

Phew! One thing less to worry about.

And by the time I’m selling that many goodies in my dropshipping store, I will happily be able to afford a brilliant Accountant to handle all my tax submissions for me.

Hope when you do your research on your countries tax laws, you find happy news too.

Let’s do a quick poll.  In the comments below, let me know which country you come from and whether you have to collect and pay Sales Tax to your government on the goods you sell online.

*This post was sponsored by Tax Connex, who take the headache out of Sales Tax in the United States. Writing sponsored posts is just one of the ways I earn income from my blogs. All opinions are my own.