December 15, 2022

The effect of past transactions on the sale of a business

The sale of a business is often a complex venture and requires consideration of various facts in examining the financial reality behind the sale. From the outset, it is important to consider historical transactions and how they may have a detrimental impact on the current sale being considered. For purposes of this article, several factors are highlighted to consider in pursuance of the sale of a business. These factors, amongst others, include: Clawback provisions of the corporate restructuring rules: These rules, as contained in sections 41 to 47 of the Income Tax Act No. 58 of 1962 (“the Act”), potentially […]
December 15, 2022

Two retirement pots: Limited access, compulsory preservation

Is the proposed two-pot retirement system ‘stirring the pot’ in the retirement fund industry? The draft tax legislation released by National Treasury on 29 July 2022 contains details of the much anticipated two-pot retirement system.  The proposed changes are quite far-reaching—although there will also be criticism that the changes do not go far enough. The intention is for the changes to address the following two concerns: The inability of households in financial distress to access their retirement savings prior to withdrawal or retirement; and The failure to preserve funds for retirement, in those instances where members withdraw from their pension […]
December 15, 2022

When performance fees punish

Six nasty hidden pitfalls that hammer your investments Performance fees are becoming an increasingly popular method of charging among asset managers—but there are nasty hidden pitfalls in calculations that can cost investors dearly. A growing number of asset management companies are turning to performance fees as an alternative to fees as a percentage of assets under management.  The latter can be a lucrative and easy way for investment professionals to make loads of money for doing very little to outpace the market. While 2% of an investment may seem like a small figure to pay for the services of a […]
December 15, 2022

Welkom 2023

‘n Voorspoedige 2023 word vir al ons T Roos  kliënte en personeel toegewens! Mag julle elkeen ‘n jaar van onvoorwaardelike liefde, nimmereindigende vrede en tonne voorspoed en geluk geniet. Mag julle elke dag God se droom vir julle lewe uitleef. ‘n Vriendelike verwelkoming aan al ons personeel, ons vertrou julle het die feestyd geniet en lekker uitgerus. ‘n Vriendelike verwelkoming ook aan die nuwe personeel wat by ons T Roos “familie” aangesluit het, ons weet julle gaan dit baie geniet hier en vertrou dat julle ‘n aanwins tot die praktyk sal wees. Hierdie artikel is algemene inligtingsblad en moet nie […]
October 24, 2022

Lenders of money are not all ‘money lenders’

Taxpayers’ actions need to back up what they claim to be In many groups of companies, intra-group loans make sense as a way of funding the operations of the group. If the funds are sourced from outside the group by a borrower entity and then on-lent to other companies within the same group as the borrower, the question is whether the interest incurred by the borrower entity is deductible in terms of section 24J(2) of the Income Tax Act No 58 of 1962 (the Tax Act)? This question was once again considered in Taxpayer H v Commissioner of the South African […]
October 24, 2022

Is your business covered for loss of income?

It’s all well and good being paid out for your assets, but what about the foregone earnings in the meantime? Small business owners who have a short-term commercial insurance policy are often not aware that they may not be covered for the loss of income, under a standard commercial policy. Although a standard short-term insurance policy can assist SMEs to replace, repair or reinstate various assets following a loss, it does not provide cover against the loss of income as a result of a business being non-operational or not being able to provide a service following a covered loss. Business […]
October 24, 2022

When SARS requests supporting documents

E-filing doesn’t allow ‘secured’ or password-protected documents to be uploaded—but there is a solution Following SARS Commissioner Edward Kieswetter’s announcement that he intends to rebuild SARS’ enforcement capabilities as part of his quest to become the scourge of recalcitrant taxpayers, there has been a noticeable increase in requests from SARS for the submission of supporting documents. However, thanks to e-filing, the days of having to photocopy reams of documents and pop them in the post, fervently praying that they will arrive at SARS’ offices, reach the right department, and be received and logged with-in the 21 working-day window, are long […]
October 24, 2022

How trusts preserve generational wealth

The estate duty savings are compounded over several generations Articles on trusts are often aimed at settlors or donors to highlight the benefit of trusts and the role they play in estate planning at the ‘first-generation’ level.  In this article, the author aims to illustrate to second-generation beneficiaries the effect of the decisions their parents took on their behalf to establish a trust in which to grow their assets. The scenario Client X retired 10 years ago, withdrew the tax-free portion of his retirement fund, and added this to other funds he held.  He then placed the total amount on […]
October 14, 2022

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 eat” 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 […]
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