Author: Nyasha Musviba

Treasury Plans to Tax Dividends Paid to Employees as Income

Nyasha Musviba

Changes proposed by the Treasury in the Taxation Laws Amendment Bill follow international trends in tightening the net on the use of salaries disguised as dividends. According to the explanatory memorandum published by the Treasury recently, many share schemes hold pure equity shares where the sole intent of the scheme is to generate dividends for employees as compensation for past

Taxation of public benefit organisations changed

Nyasha Musviba

  ‘Ruling could take parties unaware’ – Piet Nel. JOHANNESBURG – Public benefit organisations (PBOs) should take note of a new binding ruling issued by the South African Revenue Service (Sars), which could result in the loss of their tax exemption on business undertakings or trade activities. Last month, Sars issued a binding general ruling, which aims to provide clarity on the concept “substantially the whole”.

Plan for Tax on Foreign Services Questioned

Nyasha Musviba

The proposed introduction of a 15% withholding tax on consultancy, management and technical fees for services rendered by a foreign consultant or company to a South African firm has been described as “unworkable”. The tax was proposed in the Taxation Laws Amendment Bill at the end of last year and was aimed at protecting the tax base, as the fees generated local deductions and thereby gave rise to a potential erosion of the tax base, the Treasury said in its explanatory memorandum to the bill.

Youth Wage Subsidy Comes into Effect Youth Wage Subsidy Comes into Effect

Nyasha Musviba

The Employment Tax Incentive Act, commonly known as the youth wage subsidy, came into effect at midnight, SABC news reported on Wednesday. The government hopes the law will promote employment for young people and create jobs in special economic zones once legislation providing for them has been promulgated. In terms of the act, employers will receive a tax incentive to employ young workers for a maximum of two years under certain conditions

SA records R770m trade surplus

Nyasha Musviba

  Johannesburg – South Africa recorded a R770m trade surplus in November after a R12.39bn deficit the previous month, data from the South African Revenue Service (Sars) showed on Monday. The data incorporates previously excluded trade with South Africa’s regional neighbours Botswana, Lesotho, Namibia and Swaziland, collectively referred to as BLNS. When stripping out trade with the BLNS countries, the trade balance showed a R9.24bn deficit for November, narrower than the R20.97bn shortfall for October. Exports in November, including regional trade, were up 5.3%, while imports were down 8.8%, Sars said.

International Tax – Exit charge CGT – Section 9H

Nyasha Musviba

The Taxation Laws Amendment Bill 39 of 2013 (the Bill) was tabled by the Minister of Finance on 24 October 2013. One of the interesting amendments in the Bill to the Income Tax Act 58 of 1962 (the Act) relates to the exit charge on interests in immovable property, especially in light of the recent amendments to the double tax treaty between South Africa and Mauritius, concluded on 17 May 2013.

Tax Administration Act – Suspension of payment of tax

Nyasha Musviba

Any taxpayer who wishes to object to or appeal against an assessment issued by the South African Revenue Service (SARS) must be aware that their obligation to pay any tax under that assessment is not automatically suspended by virtue of the submission of the objection or appeal itself. Any taxpayer who wishes for an objection or appeal to first be concluded before paying the tax due under an assessment would have to lodge a separate request for suspension of payment of tax in terms of section 164 of the Tax Administration Act No. 28 of 2011 (the TAA).