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The OECD released the latest updates to the Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations on 10 July 2017. This 2017 edition incorporates the substantial revisions made in 2016 to reflect the clarifications and revisions agreed to in the 2015 BEPS Reports on Actions 8-10 Aligning Transfer pricing Outcomes with Value Creation and […]

Maggie Kgobane was interviewed on Tax related matters with SARS Manager Thokozani Mzantsi and Advocate Ombudsman Eric Mkhawane of SARS on Yilungelo Lakho on SABC 1 on the 10th of July 2017. Maggie shared her expertise with utmost confidence. She addressed questions that are frequently asked by taxpayers regarding Taxation and included useful guidelines that […]

The 2016/17 tax season is here and this is an important year of tax filing for expatriate employees, especially South Africans working temporarily abroad. We are all well aware of the tax change on the cards and this tax submission must be done bearing future tax strategy in mind. As an expatriate, there are a […]

High-net-worth individuals (HNWIs) will find themselves under greater scrutiny from SARS in the immediate future says Jerry Botha, Managing Partner at Tax Consulting South Africa. “In reviewing the SARS Annual Performance Plan for 2017 to 2018,” he states, “one will notice that they have highlighted low compliance of HNWIs as a strategic risk.” Botha notes […]

Tax Season 2017 is Open The tax season opened on the 1st of July for individuals to submit their Income Tax returns. The deadline dates differ according to the method of submission and is as follows: 2 September 2017 for manually submitted returns; 24 November 2017 for returns submitted electronically at a SARS branch or […]

In terms of section 25 of the Tax Administration Act, 2011, Commissioner for SARS Tom Moyane promulgated Public Notice 547, which sets out the requirements for which persons how to submit income tax returns for 2017 year of assessment. In terms of section 25 of the Tax Administration Act, read with section 66(1) of the […]

Employee Children Bursaries – Tax Saving Structuring The ability for employees and business owners to pre-tax structure their children’s school and university fees, remain one of the few available, but seldom used tax planning opportunities. This is the only tax break allowed on private expenses and have been extended in the 2017/18 Budget Speech. The […]

Tax Residency and Retirement Annuity considerations for Expatriates South African expatriates are reeling in response to the proposed changes to the foreign income tax exemption, so much so that many expatriates are investigating whether they can become non-resident for tax purposes. Similarly, expatriates who previously intended to retire in South Africa are now not so […]

Sayonara to Tax Free Earnings The proposed amendment to section 10(1)(o)(ii), the exemption section referred to often as the so-called 183-and-60-day rule aims to limit the current tax-free earning situation of South African tax residents working abroad. Under the current regime, taxpayers who are resident in the Republic and earn an income under a foreign […]

SARS to Exchange Tax Information with over 50 Jurisdictions The South African Revenue Service (SARS) has committed to the automatic exchange of tax information with the revenue authorities of over 50 other jurisdictions under the Organisation for Economic Co-operation & Development (OECD) Common Reporting Standard (CRS) by September 2017. This international initiative goes hand-in-hand with […]

EXPATRIATE TAX COMPLIANCE FOR SOUTH AFRICANS ABROAD STEP-BY-STEP We have received numerous requests from South Africans working abroad for a step-by-step explanation on what should be done to ensure they are fully tax compliant and optimally planned, especially with the pending tax law change. Please note the below is specifically written for South African expatriates […]

Increase of the Scale of Benefits The Unemployment Insurance Amendment Act, No. 10 of 2016 (“the Act”), is aimed at having a positive effect on the country’s labour force. Furthermore, there are likely to be positive effects on the economy as well. The Act will see those who lose their jobs receive money for a […]

TIPS FOR EXPATRIATES – BRINGING MONEY TO SOUTH AFRICA We receive many questions from South African expatriates abroad who regularly transfer money to South Africa, to support various costs or investments in South Africa. Some do this monthly and others effect larger transfers on a periodic basis. Whilst we are not a foreign exchange provider, […]

The application of double tax treaties may very well find application, and is obviously an important part of international tax planning consideration. This is, however, a complex area of tax and application of rules differ between countries. We often see even local South African tax experts getting this wrong, so please just work with caution […]

UPDATE ON SOUTH AFRICAN TAX ON EXPATRIATE EMPLOYEES AND VARIOUS CLIENT QUESTIONS / RESPONSES TO SOME SOCIAL MEDIA COMMENTARY The National Treasury announcement of taxes on expatriate employees, where no exemption under section 10(1)(o)(ii) will be allowed where there are not actual taxes paid in the host country, has resulted in considerable comment and debate. […]

On 28 October 2016 SARS published, in the Government Gazette, a notice under section 29 of the Tax Administration Act, No. 28 of 2011 which requires of selected multinational enterprises who enter into certain transactions to keep, what is effectively, a transfer pricing policy. In terms of the notice, information required to be kept in […]

Further to the Budget Announcement on proposed amendment to section 10(1)(o)(ii), the exemption section referred to often as the so-called 183-and-60-day rule; we have seen extensive commentary on social media on the impact of this section. Those who have followed the comments will resonate with the various layman views expressed. The comments have ranged from […]

OBJECTIONS AND APPEALS:THE HELPLESS TAXPAYER? Only assessments and certain prescribed decisions are subject to objection and appeal in terms of section 104 of the Tax Administration Act, No. 28 of 2011 (“the TAA”). There are a multitude of decisions that can be made by SARS and that are not subject to objection and appeal. These […]

BUDGET 2017: TAX CHANGES The 2017 budget lived up to the expectation created by the Finance Minister with the medium term budget policy statement late last year in which it was made clear that R28bn in additional tax revenue must be generated. Tax increases were announced as follows: Introduction of top marginal tax rate of […]

The position for non-executive directors remain complex, despite the recent SARS General Rulings. The general rules confirmed in these Rulings are that non-executive director fees will, with effect 01 June 2017, not be subject to employees’ tax withholding and will be subject to VAT where the non-executive director is liable for VAT, either through voluntary […]

Historically, it was unclear whether amounts paid to a non-executive director were subject to the deduction of employees’ tax and whether the prohibition against certain deductions by salaried employees applied to them. This being as a result of a non-executive directors arguably not earning remuneration as defined in the 4th Schedule to the Income Tax […]

Relocation Allowance – Complex Tax Law Change The very old and tested dispensation of paying an employee 1 month tax free relocation allowance on moving residency for employment, has been repealed by SARS. The new rule applies effective 01 March 2016 onwards and unfortunately the new rule comes with significant uncertainty in application. Where an […]

ALL eyes will be on government’s tax proposals in the upcoming national budget, to be tabled in Parliament on February 22. The minister of finance already indicated in his mini budget that the fiscal authorities will be looking for additional tax revenue of R28bn in the 2017/18 fiscal year, plus a further R15bn in 2018/19, […]

SA RETIREMENT LUMP SUMS: FULLY TAXABLE DESPITE OFFSHORE SERVICES Promulgation of the 2016 Taxation Laws Amendment Bill on 8 January 2017 brings about an impending change to the way in which South African pension, pension preservation fund, provident funds, provident preservation funds and retirement annuity fund (“hereinafter collectively referred to as a “retirement fund”) lump […]

With the introduction of Dividends Withholding Tax during the 2013 fiscal year, corporate taxpayers (effectively) saw an increase in the effective tax rate from 34.55% to 38.8% while the Royalty withholding tax was increased from 12% to 15% in the 2015 fiscal year. In the 2016 fiscal year, individual taxpayers bore part of the brunt […]

South Africa could add pure fruit juices to the list of drinks expected to face a levy under a proposed tax on sugary drinks, the Treasury has said, in a country where more than half of adults are overweight. In his budget speech in February, Finance Minister Pravin Gordhan proposed the tax on sugary drinks […]

XO AFRICA SAFARIS CC v C:SARS (395/15) [2016] ZASCA 160: Supreme Court of Appeal case dealing with whether the supply of services are to be standard rated or zero rated in terms of section 11(2)(l) of the VAT Act, following services being supplied to a non-resident of South Africa but being supplied directly to other […]

A Supreme Court of appeal case was ruled between CSARS and Morula Platinum Mines which determines whether certain mined ore should be included in trading stock or be classified as mining operations in terms of the deductibility of the costs thereof. For access to the entire case, please click here.

Binding Private Ruling 252 was issued and determines the donations tax and capital gains tax consequences of the waiver of part of a loan to an employee share trust and the reduction of the interest rate on the remaining balance of the loan to 0%. For access to the entire ruling, please click here.

The recent ruling of Masango v RAF deals with the Contingency Fee Act and how to charge VAT on fees for services rendered. For access to the entire ruling, please click here.

The recent Tax Court case 13164 gives clarity on the applicability of section 103(2) of the Income Tax Act to assessed losses carried forward. For access to the entire case, please click here.

THE “fear-mongering” tactics employed by the beverage industry against the proposed sugar tax have been “shocking” and “more than the norm”. This is according to Ismail Momoniat, deputy director-
general of the National Treasury, who was commenting on the 
industry’s reaction since Finance Minister Pravin Gordhan announced the tax earlier this year. The tax will result […]

SARS has issued their second basic guide to income tax exemption for Public Benefit Organisations to assist organisations in obtaining and retaining approval as a public benefit organisation. For access to the entire guide, please click here

A recent case before the Supreme Court of Appeal (CSARS v Marshall NO and Others (816/2015) [2016] ZASCA 158 (3 October 2016)) involved the question of whether or not actual supplies by a designated entity to the Western Cape Department of Health qualified for the zero rating under section 11(2)(n) read with section 8(5) of […]

National Treasury released the following media statement on the special VDP for offshore assets. For access to the entire media statement, please click here. SARS have also updated the guide for special VDP, please click here to access the guide. Interestingly, the last version of the bill that proposed to include to the special VDP […]

The South Atlantic Jazz festival case (“Jazz festival case”) put into a motion a series of changes to the VAT legislation, more specifically, as to when an input tax claim can be made without a proper tax invoice. In short, the taxpayer in the South Atlantic Jazz festival case was successful in a dispute against […]

When the Minister of Finance announced in the 2016 budget speech that the ability to claim input tax credits within 5 years will be revisited, taxpayers and tax practitioners alike waited with great anticipation to see if the proposal found its way into the draft bills so as to comment on why this should most […]

In the case of VAT 1247:  XYZ Company (Pty) Ltd v The Commissioner for The South African Revenue Service, the court was faced with interpreting section 22(3) of the VAT Act, notably, in relation to a period before 22(3A) was introduced. Section 22(3) of the VAT Act in essence requires a person who has claimed […]

This ruling determines the income tax consequences resulting from cash contributions to be made by the applicant to a special purpose vehicle (separate property company) established to provide housing for the employees of the joint venture and the group of companies of which the Applicant forms part. The separate property company (SPV) will obtain funding […]

This Binding Private Ruling deals with the reinstatement of a deregistered company in order to complete a transfer of immovable properties, pursuant to an amalgamation transaction. It concerns section 44(13) of the Income Tax Act, section 8(25) of the VAT Act, and section 9(1)(l)(iB) of Transfer Duty Act. Click on the button below to view […]

The recent case of D v Commissioner for South African Revenue Service (VAT 1390), which is an appeal referred by the taxpayer to the Western Cape Tax Court after being dissatisfied with the decision by the Tax Board, reconfirms that supplies made by an independent contractor to the taxpayer and recovered from customers by the […]

The tax dispute resolution process, contained in the Tax Administration Act, No. 28 of 2011 as well as the rules promulgated under section 103 of that act was designed to ensure efficient and simple resolution of tax disputes. Of late, however, our experience has been quite the opposite. It is evident that the current economic […]

Aggrieved taxpayers are provided with a legislative mechanism in order to resolve disputes with SARS, the latest version of which came into effect on 11 July 2014 and was promulgated in terms of section 103 of the Tax Administration Act, No.28 of 2011. These legislative mechanisms are commonly referred to as “the tax dispute resolution […]

SARS recently changed their dispute process on e-filing to include additional functions such as allowing taxpayers to request suspension of payments online or submitting a request for remission of interest and admin penalties. The system furthermore compiles the DISP01 on your behalf and only requires the taxpayer to select the amounts under dispute and to […]

SARS provides unhappy taxpayers with the following three ways to submit a complaint: Via E-filing; At a SARS branch; and Through the SARS Compliant Management Office (CMO) The CMO should be contacted telephonically on 0860 12 12 16 and taxpayers should only submit a compliant where they have the relevant case reference number. As the […]

In the fast-paced world of taxation it is often difficult to stay abreast of latest developments. Nico Theron’s opinion on the latest Tax Regime was mentioned in the following articles: “Nico Theron from Tax Consulting, a firm offering tax services to small accounting and auditing firms, says the rules governing the regime remain complicated, which […]

Background, aims and enactment of FATCA The Foreign Account Tax Compliance Act (colloquially known as “FATCA”) was enacted by the United States government during 2010, under sections 501-541 of the Hiring Incentives to Restore Employment (“HIRE”) Act.[1]  FATCA was implemented with the aim of counteracting tax avoidance, and aims to improve tax compliance by imposing […]

National Treasury would like to inform all members of the public that the tax harmonisation reforms of retirement funds will be implemented from 1 March 2016. This is in terms of the current law legislated in 2013, and amended in 2014 by shifting the effective date to 1 March 2016 (i.e. the Taxation Laws Amendment […]

In the fast-paced world of taxation it is often difficult to stay abreast of latest developments. From January 2016, Nico Theron will be covering changes in tax law as they happen in a monthly webinar presented on behalf of the South African Institute for tax Practitioners. Visit http://www.thesait.irg.za for dates and bookings.

It is that time of the year again when Medical Aid Schemes are releasing their premium rates for the 2016 calendar year. In a comparison, conducted by Remuneration Consultants South Africa, the 2015 and 2016 contribution rates of seven of the most prominent Medical Aid Companies in South Africa revealed an on average contribution rate […]