Tag archives: Tax

Doing good doesn’t always entitle an NPO to tax benefits

By Liesl Williams and Dale Cridlan on February 17, 2023 Posted in General

Tax exempt status may be awarded to a non-profit organisation (NPO) that solely or primarily undertakes public benefit activities with a philanthropic or altruistic intent. An NPO that has been granted tax exempt status (commonly referred to as a public benefit organisation or PBO) is generally exempt from income tax. Certain approved PBOs may also … Continue reading

National Treasury again commits to the ‘modernised system’ of exchange control regulation in 2022 Budget Speech

By Dale Cridlan on March 8, 2022 Posted in Finance

This blog was co-authored by: Kristin January, Candidate Attorney On Wednesday 23 February 2022, the Minister of Finance presented his inaugural Budget Speech. The National Treasury confirmed its commitment to transformation of exchange control regulations with several new proposals: Individuals are permitted to export dual listed domestic securities to a foreign recognised exchange, subject to … Continue reading

Supplementary budget 2020

By Belinda Sussman and Dale Cridlan on June 29, 2020 Posted in General

South Africa’s Finance Minister Tito Mboweni delivered a supplementary budget on Wednesday 24 June 2020, highlighting that business confidence will remain near historic lows, with investment and employment remaining constrained. This emergency budget comes only four months after the National Budget which has been left defunct in the wake of COVID-19 and a three-month lockdown … Continue reading

You may not claim both a section 18A certificate and BEE points for donations to a non-profit entity

By Liesl Williams and Amber Kardamilakis on May 24, 2020 Posted in General

Donations to non-profit entities may carry a tax benefit for the donor – the hallowed section 18A certificate. This allows the donor to claim a tax refund and encourages donations. Non-profit entities that are Public Benefit Organisations (PBO) can issue these certificates. PBO status is granted by the South African Revenue Service (SARS) under the … Continue reading

Tax relief measures for challenging times

By Vivian Spies and Mpho Duiker on April 16, 2020 Posted in General

The Minister of Finance announced tax relief measures in an attempt to assist small to medium businesses in the face of COVID-19. But what tax relief is available to taxpayers who fall outside the ambit of these new measures? Instalment payments Taxpayers unable to pay tax debts due to economic instability caused by the pandemic … Continue reading

What tax relief measures are available as a consequence of COVID-19?

By Dale Cridlan on April 6, 2020 Posted in General

Exceptional tax measures have been announced as part of the fiscal package that was presented by the President in his speech on the Escalation of Measures to Combat COVID-19. The tax measures result from the realisation that there is a critical need for government interventions to assist with job retention and assist businesses experiencing significant … Continue reading

How to establish a business enterprise in South Africa: Ten things to know

By Stephen Kennedy-Good, Dale Cridlan, Mpho Duiker and Ally Chalwin-Milton on March 27, 2020 Posted in General

01 I Methods of incorporation A business presence can be established in South Africa, one can either incorporate a South African entity or incorporate a foreign offshore entity, as a so called ‘branch’ or ‘external company’. 02 I Applicable legislation Both forms of business enterprise are regulated by the Companies Act 2008. However, in the … Continue reading

Valuation of stock at year end: time-based write-down not enough

By Siyabonga Mathe and Dale Cridlan on November 22, 2019 Posted in General

The Income Tax Act 1962 requires opening and closing trading stock to be taken into account in determining taxable income derived from carrying on any trade in any assessment year. Section 22(1)(a) of the Act deals with the valuation of the stock, and provides that in respect of a taxpayer’s trading stock that is held … Continue reading

South Africa 2019 Medium-Term Budget Policy Statement

By Dale Cridlan on November 13, 2019 Posted in General

The 2019 Medium-Term Budget Policy Statement (MTBPS) was recently delivered by Finance Minister Tito Mboweni and recognises that South Africa’s economic growth has been slowing alongside productivity and competitiveness. South Africa’s debt-to-GDP ratio is among the highest of its peer countries, with only Argentina, Croatia, Ukraine and Zambia worse off. It is projected that the … Continue reading

Test for a simulated transaction avoiding the payment of tax

By Patrick Bracher (ZA) on December 21, 2018 Posted in General

A transaction is not necessarily a disguised one because it is devised for the purpose of avoiding liability for tax. If the parties honestly intend the contract to have the effect stated in the contract then the only question is whether there is liability for the tax or not. The court will ascertain the intention … Continue reading

‘Controversial provisions’ in Draft Taxation Laws to have far-reaching implications

By Shanae Pillay and Andrew Wellsted on December 6, 2017 Posted in General

In July 2017, the first draft of the Taxation Laws Amendment Bill (TLAB) was released by National Treasury for public comment. It will give effect to the majority of the proposed tax legislation changes which were announced by the Minister of Finance in his annual budget speech in February. The TLAB contains a number of … Continue reading

Taxation of cryptocurrencies: Buying and selling Bitcoin

By Jonathan Purnell on October 2, 2017 Posted in General

With Bitcoin’s popularity and value growing significantly, many wonder how cryptocurrencies will be treated by the South African Revenue Service (SARS) and other regulators. Bitcoin is one of hundreds of different cryptocurrencies in existence. Cryptocurrencies are unregulated, decentralised digital currencies which can be bought, sold and traded for fiat money or goods and services. According … Continue reading

A penny for your sweet tooth

By Andrew Wellsted on June 5, 2017 Posted in General

Before purchasing a sugar sweetened beverage (SSB), spare one thought for the health consequences and another for your wallet. Late 2017 is likely to see the introduction of a new tax in South Africa in the form of a health promotion levy (or sugar tax). Empirical evidence suggests that the quality of human health has … Continue reading

Last chance to come clean

By Andrew Wellsted on May 10, 2017 Posted in General

The Special Voluntary Disclosure Programme (SVDP) running until 31 August offers South African residents the opportunity to regularise their tax defaults and exchange control defaults. There have been a number of similar opportunities to regularise tax and exchange control affairs in the past. We have seen two previous special amnesty opportunities in 2003 and 2010 … Continue reading

Preparing for carbon tax without a carbon tax law

By Kirsten Hunt on June 8, 2015 Posted in General

The question arises how businesses should prepare for the introduction of carbon tax on 1 January 2016, when the legislation has not been released. There are clues in the carbon tax policy paper released in 2013 by National Treasury about what we can expect to see in terms of the pricing of carbon and how it is … Continue reading

South African National Budget 2015

By Andrew Wellsted on February 27, 2015 Posted in General

The South African national budget speech was delivered on 25 February 2015 by the Minister of Finance, Minister Nene. Have a look at our tax team’s review of the South African National Budget 2015.… Continue reading

USA/SA FATCA agreement now prevents secret investments

By Peter Surtees on February 26, 2015 Posted in General

In February 2014 SARS announced that the implementation date of the FATCA Agreement with the USA was 28 October 2014. What does this mean? FATCA is the international agreement imposed by the USA on all signatories (which in effect means any country wishing to remain on cordial financial terms with the USA) under which financial institutions … Continue reading

Government provides tax incentive to avoid those rainy days

By Gareth Weston on November 19, 2014 Posted in Banking

National Treasury has published draft Regulations which allow tax free savings products and investments from 1 March 2015. Licensed banks, long-term insurers, managers of registered collective investment schemes, authorised users (stock-brokers), linked investment service providers (LISPs) and the National Government will be able to offer tax free savings and investments to the public and will … Continue reading

Withholding tax on interest pushed back again

By Riza Moosa on November 17, 2014 Posted in Banking

Anticipating the widespread effect of the new withholding tax on interest, extensions to its application have been promulgated. The latest Taxation Laws Amendment Bill proposes a further extension of the implementation date to 1 March 2015. Payments of interest to or for the benefit of a foreign person by a South African borrower will be subject … Continue reading

FATCA reporting from 1 July 2014

By Desiree Reddy (ZA) on June 27, 2014 Posted in Banking

Enacted in 2010, the US Foreign Account Tax Compliance Act (FATCA) seeks to prevent tax abuses by US persons living or operating outside of the US. FATCA imposes a 30% withholding tax on payments of US source income made to non-US financial institutions, unless they enter into an agreement with the US Internal Revenue Service … Continue reading

Foreign e-commerce suppliers must register as VAT vendors by 1 June 2014

By Dale Cridlan and Nerushka Bowan on May 29, 2014 Posted in General

The e-commerce VAT regulations have shifted the onus of collecting and paying VAT from the South African purchaser to the foreign supplier. The “new” e-commerce VAT regulations are in fact not a new form of VAT. VAT was always due to the South Africa Revenue Service (SARS) on purchase of e-commerce goods or services from … Continue reading

Tax planning is not dead

By Andrew Wellsted on February 12, 2014 Posted in General

Ruan Jooste’s interesting Business Day article raises the question whether tax structuring is under threat. Although it correctly reminds us that companies engaging in tax structuring need to proceed with caution, tax structuring is alive, well and lawful. Getting advice on a balanced approach to tax structuring and implementing robust structures which achieve the best … Continue reading