Share incentive schemes are once again in the spot light in this year’s tax budget proposals. It appears that previous amendments have not satisfied Treasury’s concerns on share incentive schemes. Treasury indicates that some staff equity schemes are used as a tool to lower overall tax rates for executives and other-high-income earners. Schemes for lower income taxpayers are sometimes subject to anomalies that may give rise to double taxation.
Author: Nyasha Musviba
Budget review – 2013 budget highlights
Introduction The 2013 budget read by the Minister of Finance on 27th February 2013 contains relatively fewer tax proposals than prior years. However, some of the proposals are quite far reaching particularly relating to Trusts and Corporate gearing. In this brief analysis we highlight some of the key proposals for tax law changes.
The tax saving opportunities of e-toll
Issued by Philip Rosenberg, TaxTalk The introduction of an e-tolling system on roads in certain Gauteng areas were strongly opposed by the parties affected. Not only are consumers faced with a persistent increase in the petrol price, but they are now also exposed to additional traveling expenses each time they pass an e-toll gantry. This situation can be financially overwhelming for some people but fortunately there may be a light at the end of the tunnel for taxpayers.
South Africa Mulls Coal Export Duty
by Lorys Charalambous, Tax-News.com, Cyprus At the 2013 SA Coal Exports Conference, South Africa’s Minister of Mineral Resources Susan Shabangu confirmed that no decision had yet been taken by the government on whether or not to apply a duty on coal exports.
FAQ – Donations Tax
FAQ: Do any exemptions apply to Donations Tax? FAQ: What is Donations Tax? FAQ: What is the rate of Donations tax? FAQ: What is base cost? FAQ: What is a tax deductible receipt? FAQ: What is a bona fide donation? FAQ: What requirements must be complied with after obtaining section 18A approval? FAQ: Which non-core taxes can be paid on e-Filing? FAQ: What does it mean when an organisation is approved by SARS for section 18A purposes? FAQ: Can a section 18A tax deductible receipt be issued without SARS approval?
FAQ – Can a section 18A tax deductible receipt be issued without SARS approval?
No, only organisations that have been approved under section 18A of the IT Act by the Commissioner may issue tax deductible receipts to taxpayers in respect of bona fide donations made in cash or in property of kind. The Commissioner must issue a reference number for section 18A purposes to the organisation, which must appear on the tax deductible receipt issued to the donor.
FAQ – What does it mean when an organisation is approved by SARS for section 18A purposes?
An organisation approved by the Commissioner under section 18A of the IT Act may issue tax deductible receipts to taxpayers in respect of any bona fide donation made in cash or of property made in kind.
FAQ – Which non-core taxes can be paid on eFiling?
The following non-core taxes may be paid on eFiling, including all payments exceeding R500 000 Company Fees Donation Tax Estate Duty Mining Royalties Other Mining Leases Small Business Amnesty Turnover Tax Value-Added Tax (VAT) for non-registered vendors Withholding Tax on Royalties
FAQ – What requirements must be complied with after obtaining section 18A approval?
An organisation approved by the Commissioner for purposes of section 18A of the IT Act is required to: Only issue tax deductible receipts in the year the donation is received. Maintain proper control over the application of donations received which qualify as a tax deduction. Only issue a tax deductible receipt for a donation used to carry on section 18A approved PBAs. If a PBO carries on both Part I and Part II PBAs, the PBO will be required to obtain an auditor’s certificate certifying that all donations for which tax deductible receipts were issued were used solely in carrying on approved PBAs in Part II of the Ninth Schedule to the IT Act.
FAQ – What is a bona fide donation?
A bona fide donation is a voluntary, gratuitous gift disposed of by the donor out of liberality or generosity, where the donee is enriched and the donor impoverished. There may be no quid pro quo, no reciprocal obligations and no personal benefit for the donor. If the donee gives any consideration at all it is not a donation. The donor may not impose conditions which could enable him or any connected person in relation to himself to derive some direct or indirect benefit from the application of the donation.