June 28, 2022

Individual filing opening

Taxpayers, your turn to file your tax return started on 1 July this year. The good news is that a significant number of individual taxpayers will be auto-assessed again this year, and this process will start in July.  No need to call us, we will send you an SMS if you are selected to be auto-assessed.  However, we have made it much easier this year. When you receive the SMS, log into eFiling or MobiApp to view your assessment. If you agree with the assessment there is nothing more to do – if a refund is due, we will pay […]
March 9, 2022

How to become a DTMC

In 2013, the South African government introduced the Domestic Treasury Management Company (DTMC) regime to allow South African companies that are registered with the Financial Surveillance Department (FinSurv) of the South African Reserve Bank (SARB) to expand into the rest of Africa and abroad. The DTMC Regime, in essence, allows unlisted companies to establish one subsidiary within the group as a DTMC, not only to hold offshore operations for foreign direct investment purposes but also domestic treasury management operations, without being adversely restricted by the exchange control regulations of the SARB. Incorporating a DTMC allows South African groups to avoid having […]
January 26, 2022

Retirement saved from controversial tax proposal

When an individual ceases to be a South African tax resident prior to retirement from a South African retirement fund and becomes tax resident of another country, that individual’s interest in a retirement fund may, on payment of a lump sum or monthly pension, be subject to tax in the other country. The application of a tax treaty between South African and the country of tax residence may, in some instances, result in South Africa forfeiting its taxing rights – while the taxpayer benefited from tax concessions for contributions. Taxpayers who remain residents, only have access to their retirement interest […]
January 26, 2022

Is your disclosure “voluntary”?

In December 2021, the Supreme Court of Appeal (SCA) handed down a judgment dismissing an appeal against a decision of the Tax Court. The issue before the SCA was whether the South African Revenue Services (SARS) was correct in rejecting Purveyors South Africa Mine Services (Pty) Ltd’s (Purveyors) Voluntary Disclosure Programme application (VDP application) for non-compliance with the requirements for VDP relief, more specifically on the ground that it was not made voluntarily. In 2015, Purveyors entered into a dry lease agreement, in respect of an aircraft registered in the United States of America. Purveyors entered into an aircraft management […]
November 15, 2021

Marriage may finally become equal for all

Being a person’s spouse could have varying tax consequences, particularly where they are married in community of property. Currently, for income tax purposes, you are deemed to be a person’s spouse in the following instances: (a)  A person who is in a marriage or customary union recognised in terms of the laws of the Republic;  (b)  A person who is in a union recognised as a marriage in accordance with the tenets of any religion; or  (c)  A person who is in a same-sex or heterosexual union which is intended to be permanent…” In May this year, Government published a Green Paper on marriage […]
November 15, 2021

Tax costs of barter transactions

Barter transactions are commonplace in today’s commercial environment. Parties exchange goods or services without a cash transaction underpinning it. The question is, “What happens when I sell the asset in future? Do I have a tax cost for it?” Paragraph 20(1)(a) of the Eighth Schedule to the Income Tax Act refers to ‘the expenditure actually incurred in respect of the cost of acquisition or creation of that asset’. The word ‘expenditure’ includes expenditure in cash or in kind. In ITC 1783 the court established the following about the meaning of the word ‘expenditure’: “Expenditure” in its ordinary dictionary meaning is the spending of money or its equivalent e.g. time or labour and a […]
October 14, 2021

Disputing SARS decision and assessments

A taxpayer who is aggrieved by an assessment or decision of SARS against that taxpayer has the right to dispute that assessment or decision. If an original assessment has not been issued, SARS may request a taxpayer to submit an amended return to correct an undisputed error made in the prior return. In the case where an assessment has already been issued, the dispute resolution rules in the Tax Administration Act provides the legal framework to be followed by both SARS and the taxpayer to resolve any disputes. Section 93(1)(d) of the Tax Administration Act provides an alternative to the […]
May 4, 2021

Value Added Tax and its application on general and specified-use vouchers

On 12 January 2021, the Gauteng High Court delivered judgement in the matter of MTN (Pty) Ltd v CSARS (79960/2019) [2021], in respect of a declaratory order that MTN sought to confirm their interpretation of the VAT treatment of certain airtime vouchers. The VAT Act distinguishes between two types of vouchers – those that can be used for unknown goods and services at the time of issue (consider, for example, a retail shopping voucher); and those vouchers that can be spent on specific goods and services (in other words, not able to be used for goods and services other than those specified). […]
April 19, 2021

It’s hunting season! Are you ready?

As the traditional winter hunting season approaches and South African borders are (somewhat) more open after the stricter COVID-19 lockdown, it is important revisit the Value-Added Tax (VAT) impact of the various goods and services generally supplied to foreign hunters. The general rule is that the supply of goods or services in the Republic by a vendor to a foreign hunter is subject to VAT at the standard rate on the basis that the goods or services are consumed in the Republic. There are, however, certain exceptions to this rule. Accommodation The supply of “commercial accommodation” (lodging or board and lodging together with domestic goods […]
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