A small business corporation is a close corporation, private company (other than a personal service provider) or personal liability company of which:

• the entire shareholding or membership is held by natural persons for the entire year of assessment
• the gross income does not exceed R20 million during the year of assessment
• none of the members/shareholders, at any time during the year of assessment, held shares in any other company other than listed companies, collective investment schemes, body corporates, shareblock companies, certain associations of persons, friendly societies, less than 5% interest in cooperatives, venture capital company, shares in private companies that are inactive and have assets of less than R5 000 or have taken steps to liquidate, wind-up or deregister
• not more than 20% of the sum of gross income and capital gains consist of investment income and income from the provision of personal services
• if engaged in the provision of personal services, maintains at least three fulltime employees (none of whom may be a shareholder or a connected person in relation to the shareholder) for core operations