Introduction This case (ABC (Pty) Ltd v Commissioner for SARS ITC12466) considers the reasonability of the valuation method utilised by the appellant, ABC (Pty) Ltd, in valuing its shares in D entity which were sold during the 2002 and 2003 years of assessments. The value of those shares impacted their base cost for Capital Gains Tax (CGT) purposes and resulted in a capital loss of approximately R8 million for ABC.
Author: Nyasha Musviba
The deductibility of audit fees – Commissioner for the South African Revenue Service v Mobile Telephone Networks Holdings (Pty) Ltd, (966/2012) [2014] ZASCA 4 (7 March 2014)
Author: Beric Croome On 7th March 2014 the Supreme Court of Appeal delivered judgment in the as yet unreported case of Commissioner for the South African Revenue Service v Mobile Telephone Networks Holdings (Pty) Ltd, (966/2012) [2014] ZASCA 4 (7 March 2014) which dealt with the deductibility of audit fees incurred for a dual or mixed purpose and the apportionment thereof for tax purposes in light of section 11(a) of the Income Tax Act 58 of 1962, as amended (‘the Act’) read with sections 23(f) and 23(g) of the Act.
Medox Limited v CSARS HC 12795/14 NG – 18 Feb 2014
Introduction In this case the applicant applied to the North Gauteng High Court for an order declaring all income tax assessments that were issued in respect of years of assessment following its 1997 year of assessment null and void. Facts The applicant, trading as Drake Personnel carried on a trade in South Africa from 1976 until 1995 after which it
SA asked to abandon carbon tax plan
Author: Mark Allix (BDlive) The Steel and Engineering Industries Federation of Southern Africa (Seifsa) has called on the South African government to follow Australia’s example by abandoning the proposed introduction of carbon taxes. It said this was “in the interest of our ailing economy”. “The South African economy has been under siege in recent years, with fairly negligible growth at a time when higher levels of growth are needed in order to create much-needed jobs,” Seifsa CEO Kaizer Nyatsumba said on Thursday.
Tax collection remains buoyant
Finance Minister Pravin Gordhan says tax revenue remains “buoyant” despite a global economic turmoil that has tested South Africa’s finances. Announcing the preliminary outcomes of revenue collection for the 2013/14 fiscal year, Gordhan said the overall revenue collected by SA Revenue Service as of midnight on Monday March 31, was R899.7bn. This is R0.7bn more than the revised estimate in the 2014 Budget.
Executives see tax system encouraging compliance
Almost 80% of South African business leaders who participated in the latest International Business Report survey conducted by Grant Thornton saw South Africa’s tax system as one that encourages tax compliance. The same survey showed that 64% of the participants would welcome more global co-operation and guidance from tax authorities on what was acceptable and unacceptable tax planning‚ even if this provided less opportunity to reduce tax liabilities across borders. The survey was conducted between November and December last year‚ and 3‚500 chief executives, managing directors and chairmen were interviewed globally.
Tax tips: how property can save you money
That time of the year again – 28 February was the closing of the annual tax season for the period 1 March 2013 to 28 February 2014. Once your IRP5 has been submitted you anxiously await the decision made by SARS as to whether you need to pay in, or hopefully, that you receive a refund directly into your bank account. Either way, it is time to reflect on the coming financial year-end 28 February 2015, and to start planning on how best to focus on your financial growth. By having your income submitted to SARS you could generate a positive cash flow. For you to benefit from tax deductions, the ideal investment would be in property. It is known that to have a successful property portfolio to increase your net worth is possibly the best investment you could consider.
Customs and Excise – Search and seizure provisions unconstitutional
On 8 April 2013 in Gaertner v Minister of Finance [2013]75 SATC 184,the Western Cape High Court held that sections 4(4)(a)(i)-(ii), 4(4)(b), 4(5) and 4(6) of the Customs and Excise Act, No. 91 of 1964 (the Customs and Excise Act) are inconsistent with the Constitution, and declared them invalid. The declaration of constitutional invalidity has now been confirmed by the Constitutional Court in a unanimous judgment handed down on 14 November 2013.
Employees' Tax – Fringe Benefits on employer provided low cost housing
Introduction As part of Government’s anti-poverty objectives, Government is seeking to provide low-income South Africans with low cost housing and more specifically, ownership of residential property. In this regard, Government appears to be supportive of employers who provide low cost housing to low-income employees with the aim of enabling these employees with the opportunity to acquire ownership of the housing. This is specifically the case in industries where companies operate in remote areas and/or require employees to live away from their ordinary place of residence, like the mining industry.
Income Tax Exemptions – Employee share schemes
As a general rule, subject to certain exceptions, local dividends received and accrued to a South African tax resident are exempt from normal tax in terms of section 10(1)(k) of the Income Tax Act, No. 58 of 1962 (the Act). One such exception applies to employee share schemes by virtue of the application of section 10(1)(k)(i)(dd). Section 10(1)(k)(i)(dd) of the Act Section 10(1)(k)(i)(dd), which was introduced from 1 January 2011, prescribes that a dividend will not be exempt from normal tax if such dividend is received or accrued in respect of a restricted equity instrument (as defined in section 8C) unless: