Authors: Gary Vogelman and Alexa Muller (ENS) The South African Revenue Service (“SARS”) has extensive powers in terms of the Tax Administration Act No. 28 of 2011 (“the TAA”). In terms of section 46(1) of the TAA, SARS may, for the purposes of the administration of a tax Act in relation to a taxpayer (“Taxpayer”), require such taxpayer or another person (“Third Party”) to submit relevant material that SARS requires within a reasonable period. SARS may require such relevant material to be submitted orally or in writing.
Author: Nyasha Musviba
Successive corporate reorganisation transactions
Author: Andrew Lewis (CliffeDekkerHofmeyr) A number of advance tax rulings have recently been released by the South African Revenue Service (SARS) relating to the corporate tax rollover relief rules contained in s41 to 47 of the Income Tax Act, No 58 of 1962 (Act). The most recent ruling in this regard is Binding Private Ruling No 168 (BPR 168), which was released on 17 April 2014.
The Supreme Court of Appeal sets the record straight on what constitutes a simulated transaction
The decision in Roshcon (Pty) Ltd v Anchor Auto Body Builders CC & Others [2014] ZASCA 40 was handed down on 31 March 2014 as a unanimous judgment of the Supreme Court of Appeal. In fact, two separate judgments were given, but all five justices of appeal on the bench concurred in both judgments. The significance of the decision is that, to a considerable extent, it clears the fog of confusion that has prevailed since the decision of the Supreme Court of Appeal three years ago in CSARS v NWK Limited 2011 (2) SA 67 (SCA) in regard to what constitutes a simulated transaction.
Beverage tax aimed at reducing alcohol abuse
A major review of the taxation of alcoholic beverages is being undertaken by the Treasury as a contribution to the government’s fight against alcohol abuse and is likely to result in higher taxes and prices. The industry, faced with a deluge of regulatory proposals, is likely to resist the Treasury’s suggestions as it believes it is already over-taxed.It is also having to fight off a proposed ban on liquor advertising, which Health Minister Aaron Motsoaledi is pushing for, as well as restricted trading hours.
BINDING RULING – COMMERCIAL BUILDING ALLOWANCE
1. Summary This ruling deals with the deduction of a commercial building allowance in respect of a unit, as contemplated in the Sectional Titles Act No. 95 of 1986 (the ST Act). 2. Relevant tax laws This is a binding private ruling issued in accordance with section 78(1) and published in accordance with section 87(2) of the Tax Administration Act No. 28 of 2011.
Policy proposing carbon offset scheme published
PRETORIA: The National Treasury has published a paper for public comment outlining proposals for a carbon offset scheme that will enable businesses to lower their carbon tax liability and make investments that will reduce greenhouse gas (GHG) emissions. The Carbon Offsets Paper, which was published on Tuesday, 29 April, is part of a set of measures to address climate change. South Africa has committed to reduce greenhouse gas emissions by 34 percent in 2020 and 42 percent in 2025.
Deductible Donations
By Doné Howell, Tax Partner Grant Thornton Johannesburg “Social responsibility is an ethical theory that an entity, be it an organisation or individual, has an obligation to act to benefit society at large.” When your moral compass and sense of social responsibility lead you to acts of benevolence, you could, in addition to the sense of wellbeing that comes from helping others, also qualify for a reduction in your tax bill.
The comparability challenge in South African transfer pricing
By AJ Jansen van Nieuwenhuizen A key aspect of transfer pricing is the determination of an arm’s length or market related price. A common approach is to establish a range of profit margins through benchmarking against comparable companies’ financial data and the profit margins that they earn. One of the challenges for taxpayers in South Africa (and other developing countries), is that besides for listed companies, there is very little publicly available
VAT and your residential levies
By Cliff Watson, Associate Tax Director, Grant Thornton Johannesburg The VAT Act was recently amended and changed the VAT implications of residential property levies paid to Home Owners Associations (HOAs). The history People living in residential complexes managed by sectional title body corporates were generally not required to pay VAT on the levies paid, as the services rendered by these body corporates to their members were generally exempted from VAT.
TAX CLEARANCE CERTIFICATES AND A TAXPAYER’S ONLY REMEDY
Tax clearance certificates play an important role in our economy and are, almost without exception, a requirement when a person submits a tender or bid for doing business with government. In this regard, tax clearance certificates had always been issued by the South African Revenue Service (SARS) in terms of internal policy. As there was no legislative framework governing the issue of tax clearance certificates, there was much uncertainty among taxpayers as to their entitlement to a tax