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BEE Exempt Certificates

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The Rules for BEE Exempt Certificates

If you reside within South Africa, then you have more than likely heard about BEE (Black Economic Empowerment). This is the system that the government has put in place to attempt to uplift the formerly disadvantaged black population. A part of the BEE system is the requirement for a business to obtain a BEE certification.

A BEE certificate will give you a competitive edge and ensure you comply with the Preferential Procurement policies of corporates and the public sector which require that their suppliers be BEE certified. It will enable you to tender for Government projects and allows your corporate clients to earn Preferential Procurement points on their BEE Scorecard. Of course, a few businesses are exempt from having to work on their own BEE rating and can qualify for BEE Exempt Certificates in order to ensure that they still qualify for these tenders.

At Taxleaders.Net, our BEE certificates are aimed at Exempt Micro Enterprises who qualify for BEE Exempt Certificates. An Exempt Micro Enterprise is any enterprise with an annual total revenue of less than R5 million. A recently incorporated entity that has been in operation for less than one year (start-up enterprise) would also qualify for Micro Enterprise BEE Exempt Certificates.

About BEE Exempt Certificates

If your company makes less than five million Rand a year, then you’re automatically exempt from the BEE system and are automatically granted a BEE Exempt Certificate rating of four. This may make life much easier for Micro-Enterprises as it can be fairly expensive to obtain a BEE certification.

If you wish to obtain BEE Exempt Certificates you will have to have your company audited by an organization that is authorized to do the relevant assessments. In terms of the codes of good practice, sufficient evidence of qualification as an Exempt Micro-Enterprise (EME) is an auditor’s certificate or similar certificate issued by an accounting officer or verification agency (BEE EME Exempt Certificate).

The Rules For BEE Exempt Certificates?

As a South African employer you now have a great opportunity to boost the employment of young work seekers.

According to paragraph 4 of the Codes of Good Practice for Black Economic Empowerment, the rules for BEE Exemption Certificates are as follows:

  • Any Enterprise with an annual Total Revenue of R5million or less qualifies as an Exempt Micro-Enterprise.
  • In terms of the BEE Code of Conduct, EME’s automatically have B-BBEE procurement recognition of 100% and are deemed to have B-BBEE Status of “Level 4 Contributor”.
  • Exempted enterprises DO qualify for a promotion to the next B-BBEE status level under certain shareholding conditions.
  • If an EME is more than 50% black owned, its rating is increased to that of a “Level 3 Contributor” having BBBEE procurement recognition of 110%.
  • The number of employees of the business also has no impact on exemption.
  • Start-up enterprises are Exempted Micro-Enterprises for the FIRST YEAR following their formation or incorporation regardless of their expected revenue. Tendering for contracts above R5 million does require scorecard submission.

As a South African employer you now have a great opportunity to boost the employment of young work seekers.
We at Taxleaders.Net are an accounting and tax company who can assist with BEE Exempt Certificates for companies with a turnover of less than R5million. From Exempt Micro Enterprise (EME) and Qualifying Small Enterprise (QSE) to Generic Enterprise BEE-Ratings, we have the knowledge, qualification, and expertise to help you get certified. Let us assist you in getting your BEE Exempt Certificates hassle-free. Call us for a competitive quote today!

 

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