President Jacob Zuma’s eldest son Edward Zuma was listed as a director at the Amalgamated Tobacco Manufacturing company until 2011. Photo: Marilyn Bernard Johannesburg – Sars will be asking the National Prosecuting Authority to prosecute 15 local tobacco manufacturers and importers for tax evasion and smuggling as they continue probing and clamping down on illicit trade. And other traders, who are at “a risk of non-compliance” have been issued a warning of “regular and random audits and verification exercises”. Should any of these traders be found to be non-compliant, their manufacturing licences could be withdrawn.
Category: GAAR
Income protection policies: deduction for premiums to be abolished
By Dan Foster, associate director: International Executive Services, KPMG Employees earning remuneration are generally prohibited from claiming tax deductions for any expenditure other than those items listed in section 23(m) of the Income Tax Act (58 of 1962). This is in contrast to persons carrying on a trade independently of an employer. One of the few deductions still available to employees is for premiums paid on income protection insurance policies. Currently, such premiums are deductible if (a) the policy covers the person against loss of income as a result of
IN 75 – Exclusion of Certain Companies and Shares From "group of companies"
This Note provides guidance on the application of the proviso to the definition in section 41(1). Under certain circumstances the corporate rules provide relief from income tax when assets are disposed of between companies forming part of the same “group of companies” as defined in section 41(1). Generally these relief measures defer the income tax on income and capital gains until the asset is disposed of to a third party or until a de-grouping occurs.
SARS Successfully Opposes Business Rescue Application
A recent judgment of the North Gauteng High Court dealt with the powers of the South African Revenue Service to bring an application under section 177 of the Tax Administration Act for the sequestration, liquidation or winding-up of a taxpayer that is a tax debtor (CSARS v Miles Plant Hire (Pty) Ltd, judgment delivered on 30 September 2013).
SARS to fight for its fair share of the tax pie
Earlier this year Minister Pravin Gordhan (“the Minister”) announced the members of the Tax Review Committee (“the committee”) as well as the committee’s terms of reference. The terms of reference for the committee include inquiring into the role of the South African tax system in the promotion of inclusive economic growth, employment creation, development and fiscal sustainability. The committee is required to take into account recent domestic and global developments and, in particular, the long-term objectives of the National Development Plan (NDP) and thereafter make recommendations to the Minister. Any tax proposals arising from these recommendations will be announced as part of the normal budget and legislative processes.
Securities lending – tax implications arising from the taking of cash collateral
South African residents are taxed on their worldwide income. In particular, the Income Tax Act includes in “gross income” any amount received or accrued that is not of a capital nature. Based on case law, an amount “accrues” to a taxpayer when the taxpayer becomes unconditionally entitled to receive it (CIR v Genn and Company (Pty) Ltd, (20 SATC 113)).
International Tax – Mutual Assistance between South Africa and UK DTA
In the recent case of Ben Nevis (Holdings) Limited & Metlika Trading Limited v The Commissioners for HMRC (Her Majesty’s Revenue and Customs) [2013] EWCA, the Court of Appeal of England and Wales considered the interpretation of the mutual assistance provisions in the double tax agreement (DTA) between the United Kingdom (UK) and South Africa (SA).
Binding Ruling – BPR 143 – Headquarter company
Binding Private Ruling 143, dated 2 May 2013, issued in terms of section 76Q of the Income Tax Act No. 58 of 1962 (the Act), deals with whether certain preference shares held by the applicant (a public company incorporated and resident in South Africa) qualify as equity shares in the context of the definition of headquarter company in section 1 of the Act.
Statement On Auto Exchange Tax Info
Author: Minister of Finance Today, South Africa and the United Kingdom have agreed to work closer together to tackle offshore tax evasion, including through pressing for stronger international action. This builds on the strengthening resolve of the G20 to ensure everyone pays the tax that is due.
Shuttleworth V The South African Reserve Bank
Author: Alastair Morphet (CliffeDekkerHofmeyr) Mr Shuttleworth famously sold his shares in Thawte, which earned him a substantial amount of money. He subsequently decided to emigrate from the Republic and to transfer all of his remaining assets out of the country. The South African Reserve Bank imposed a 10% levy on his South African assets as a condition for permission under the Exchange Control Regulations to transfer his assets out of the country. He subsequently approached the North Gauteng High Court to set aside the decision of the Reserve Bank to impose the 10% levy.