Property companies urged to get familiar with legislation before making the move to list. The Real Estate Investment Trust (REIT) regime is set to usher in a new era for the listed property sector by affording certain tax advantages to qualifying entities and providing certainty in respect of the tax treatment of property loan stock companies. However, as the legislation is new and untested, uncertainties and anomalies ex
Category: Income Tax
Connected Person Forex Rules To Provide Limited Protection
The current Income Tax rules that defer tax effects for related party debts and other exchange items are to be replaced with new, revised rules. The revised rules are generally narrower than the current rules and the replacement of the old rules will trigger both one-off and ongoing tax effects for many taxpayers, the majority of which, one suspects, are unaware of the consequences.
Receiver Throws Information Net Wider
On 5th April 2013, the Commissioner: South African Revenue Service issued Government Notice number 260, which appeared in Government Gazette number 36346 on 5th April 2013, setting out returns of information which must be submitted by third parties in terms of section 26 of the Tax Administration Act, No 28 of 2011.
Shareholders liable for tax debts of companies on winding up
By Ben Strauss, Director, Tax, Cliffe Dekker Hofmeyr Be aware of potential liabilities. The Tax Administration Act, No 28 of 2011 (TAA) took effect on 1 October 2012. Among other things, the TAA makes third parties liable for the tax debts of taxpayers, under certain circumstances. In terms of s181 of the TAA, shareholders of a company can be liable for the tax debts of a company on winding up.
Sars has increased powers under the Tax Administration Act
An overview The recently promulgated Tax Administration Act, No. 28 of 2011 (TAA) contains provisions that grant some dramatically increased powers to the South African Revenue Service (Sars). Tax recovery on behalf of foreign governments Section 185 of the TAA contains the measures available to Sars to recover tax on behalf of foreign governments. Broadly defined, the provisions of section 185 provide that revenue authorities of a foreign country (with which South Africa has a tax treaty) can request Sars to assist in the collection of foreign taxes due by a person to that country.
Year in Review – 2012 Tax Developments in South Africa
During 2012 a number of significant amendments were made to the tax legislation in South Africa. This report provides a brief description of certain of these amendments which may be of interest to foreign companies that conduct business in South Africa as well as those seeking investment opportunities in South Africa.
South Africa introduces a withholding tax on interest
Currently South Africa does not impose a withholding tax in respect of interest paid to any offshore investors. However as from 1 July 2013, the Income Tax Act (58 of 1962) will impose a new withholding tax on interest paid by a resident person to or for the benefit of any foreign person.
Penalties as per Tax Adminstration Act
The Tax Administration Act No. 28 of 2011 (TAA) which (except for a few sections) came into effect on 1 October 2012, has introduced new rules governing reportable arrangements.
Meaning of primary residence
The term ‘primary residence’ is defined in paragraph 44 of the Eighth Schedule to the Income Tax Act No. 58 of 1961 (the Act). The reason this definition has captured the minds of many is due to the exclusion on the gain or loss made on disposal of one’s primary residence,
Sale of shares in a foreign company
South African residents are taxed on their worldwide income. Accordingly, a capital gain arising from the sale of shares in a foreign company will be subject to South African tax unless an exemption applies or a double tax agreement provides otherwise.