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FEATURED EVENT: 2019 Submissions of ITR14

Considerations before submission of ITR 14: Limiting SARS disputes by getting it right the first time. The primary responsibility of the tax practitioner with regard to the submission of the ITR14 is to ensure that complete and accurate information is submitted to SARS and that defendable positions are taken whenever Uncertain Tax Positions arise. 

The tax compliance function is not simply an administrative function; the tax practitioner must exercise “reasonable care” when preparing...

Tax Conference

Tax Administration & Interpretation
(SARS and Office of the Tax Ombud)

Urgent e@syfile/Efiling notice - Tax Practitioner Appointments

As a result of the e-services migration over the weekend, requests for Tax Practitioner appointments submitted on the Tax Practitioner page on the SARS website is currently not being routed to the appointment mailboxes for the respective offices.  This is a National issue and our IT team are hard at work to resolve the issue. Please inform your members not to submit any requests for appointments via the SARS website until further notice.  If an urgent appointment is required, they may submit...

SARS e@syfile/Efiling
MEDIA STATEMENT: Public Protector and Tax Ombud join forces to tackle tax-related grievances

A Memorandum of Understanding (MoU) that will see the Public Protector South Africa and the Office of the Tax Ombud (OTO) working closely together to resolve taxpayers’ complaints against the South African Revenue Service (SARS) was signed in Pretoria on Tuesday.

Tax Ombud
Important issues list for the PAYE 201902 season

Important things to remember for the PAYE EMP501 201902 submission starting 1 April 2019 – 31 May 2019

Start with a Sync Application Option 3 to check and see if there are bulk Tax numbers available. Ensure that you are using the data that was submitted for the Biannual period.

Export the Tax numbers via the Import/Export tab to your Payroll before doing Payroll run and the import for 201902.

Ensure that all the Zero’s...

SARS

TAX CASES

A Company v The Commissioner for the South African Revenue Service (IT 24510) [2019] ZATC 1 (17 April 2019)

The taxpayer carries on business as a high street retailer of clothing, comestibles and general merchandise.  As part of the facilities offered to its customers, it ‘sells’ gift cards.  These can be redeemed for goods at any of the taxpayer’s stores.  The question in this appeal from the additional assessment by the Commissioner of the taxpayer’s taxable income in the 2013 fiscal year is whether the revenue from the ‘sale’ of the taxpayer’s gift cards during that year constituted part of its...

SARS Court Cases
XYZ CC vs Commissioner of the South African Revenue Services

The Commissioner for the South African Revenue Service (“SARS”) brought an application in terms of rule 56(1)(b) of the Rules of the Tax Court for default judgment against the taxpayer in terms of section 129(2) of the Tax Administration Act, 28 of 2011 (“the Act”).

SARS Court Cases
XYZ (Pty) Ltd v C:SARS (CASE NO: 14189) - 20 December 2018

Income tax; lease; whether a lease premium is of a capital or revenue nature.

SARS Court Cases

Legislative & Policy
(National Treasury & Parliament)

Report on the consultation process for the amendments to regulations in terms of Financial Sector Regulation Act, 2017

Draft amendments to the Financial Sector Regulations, made in terms of sections 61(4), 288 and 304 of the Financial Sector Regulation Act, 2017 (Act No. 9 of 2017) (FSRA), and which were published in Government Notice No. R405 of 29 March 2018, are set out in the Schedule, were published for comment on 18 March 2019, and were also submitted to Parliament on that date. The period allowed for comment was until close of business on 27 March 2019, in accordance with section 288(8) of the FSRA....

Treasury
Media Advisory: Minister will introduce the new Commissioner for the South African Revenue Service (SARS)
Treasury
Edward CHR Kieswetter CV
Treasury

Call For Comment
SAIT member comments can be directed to taxpolicyadmin@thesait.org.za

Income Tax Act, 1962

Draft Interpretation Note – Apportionment of surplus and minimum benefit requirements – Pension Funds Second Amendment Act. 

Due date for comments: 31 May 2019

 

 

SARS
National Legislation

Consultation paper and media statement  – Policy proposals for crypto assets. Due date for comments: 15 February 2019

SARS
Income Tax Act, 1962

This BGR provides clarity on the no-value provision in respect of the rendering of transport services by an employer to employees in general, and must be read with BGR 42 dated 22 March 2017 “No-value provision in respect of transport services”. Next due date for comments: 21 January 2019 New!

SARS

International and Regional News
(OECD and ATAF)

Egypt’s updated transfer pricing guidelines part of tax reform agenda

Egypt has updated its transfer pricing guidelines as a result of a collaborative initiative between the Egyptian Ministry of Finance, the OECD’s Centre for Tax Policy and Administration (CTPA) and the African Tax Administration Forum (ATAF).

African Tax Administration Forum (ATAF)
Model Tax Convention on Income and on Capital 2017 (Full Version)

This publication is the tenth edition of the full version of the OECD Model Tax Convention on Income and on Capital.

OECD
Reforms in a few countries drive a decline in average OECD labour taxes

Income tax and social security contributions declined slightly for the average worker across the OECD in 2018, driven by major reforms in a handful of countries, according to a new OECD report.

OECD

CPD Events

PROFESSIONAL INSIGHT

Proposed amendments to clarify income tax treatment of statutory mergers

Sections 113 and 115 of the Companies Act, 2008 provide for an automatic statutory merger of two companies. The transfer occurs by way of operation of law, and barring any express prohibition to the contrary in a contractual arrangement, no third party consent is generally required to implement the merger. This type of transaction may typically give effect to a desired corporate reorganisation, in terms of which an existing company is liquidated, wound up and/or deregistered. 

Robert Gad , Megan Mccormack And Jo-Paula Roman - ENSafrica
Controlled foreign company comparable tax threshold to be decreased

The 2019 Budget noted that a global downward trend in corporate taxation rates may lead to an unintended increase in the imputation of controlled foreign companies' (CFCs') net income in South African shareholders' taxable income. This could occur despite the fact that at its inception, a CFC has operated in a jurisdiction with tax rates which met the present threshold currently contained in Paragraph (i) of the proviso to Section 9D(2A)(l) of the Income Tax Act.

Tsangadzaome Mukumba - Cliffe Dekker Hofmeyr for International Law Office
ENSafrica tax revenews - issue 23 - April 2019

Please find issue 23 of ENSafrica’s tax revenews, a snapshot of the latest tax developments in South Africa.

ENSafrica
PWC Synopsis: March 2019

A monthly journal, published by PwC South Africa, that gives informed commentary on current developments in the tax arena, both locally and internationally. Through analysis of and comment on new laws and judicial decisions of interest, Synopsis helps executives to identify developments and trends in tax law and revenue practice that may affect their business.

PWC
Africa tax in brief

AFRICA: African Continental Free Trade Area Agreement developmentsThe Parliament of Zimbabwe and the Ethiopian House of Representatives approved the African Continental Free Trade Area Agreement (“ACFTA”) on 14 March and 21 March 2019, respectively. The Moroccan Council of Government approved the ACFTA on 21 February 2019.

Celia Becker - ENSafrica
Further amendments to the VAT electronic services regulations

Revised regulations to prescribe and clarify the electronic services (e-services) supplied by foreign suppliers to South African consumers which are subject to VAT were proposed in 2018, which significantly broadened the scope of ‘e-services’. The Minister of Finance, in the 2019 Budget Review then announced that further amendments would be made to the e-services regulations to address certain oversights.

Gerhard Badenhorst and Varusha Moodaley - Cliffe Dekker Hofmeyr
Frivolous disputes: Taxpayers beware

The Tax Court judgment in XYZ CC v C:SARS (ITC 13 868) (“XYZ case”) was recently delivered as a stern reminder to taxpayers who only follow the objection process as a method to purposely delay the payment of tax, where there appears to be no valid basis to do so. The unlucky result for the taxpayer in XYZ case was that default judgment was granted and SARS’ assessment was confirmed, without the option of any further Objections or Appeals being delivered by the...

Natasha Wilkinson - Tax Consulting South Africa
VAT on the supply of electronic services

On 18 March 2019, the long-anticipated regulations prescribing the electronic services that are subject to South African Value-Added Tax (VAT) were published by the National Treasury. The regulations will be effective from 1 April 2019. Unfortunately, the delay by National Treasury in finalising the regulations has left foreign companies with very little time to register for VAT and implement any changes necessary to commence charging VAT on the supply of electronic services.

PWC
Proposed amendments to clarify income tax treatment of statutory mergers

Sections 113 and 115 of the Companies Act, 2008 provide for an automatic statutory merger of two companies. The transfer occurs by way of operation of law, and barring any express prohibition to the contrary in a contractual arrangement, no third party consent is generally required to implement the merger. This type of transaction may typically give effect to a desired corporate reorganisation, in terms of which an existing company is liquidated, wound up and/or deregistered. 

Robert Gad, Megan McCormack and Jo-Paula Roman - ENSafrica

Tax News In The Press

Small enterprise: The canary in the coal mine of a toxic business environment

Does government see small formal enterprises as an asset or a burden? Their demise suggests it is at least indifferent to their plight.

Johannes Wessels - Moneyweb
Tax Ombud: ‘Systemic investigations the way forward’

Outgoing CEO Eric Mkhawane reflects on five years of resolving issues between taxpayers and Sars.

Ingé Lamprecht - Moneyweb
When tax becomes a turning point for people to stay or leave

A change to the taxation of foreign trusts means any repatriated income or capital gains will now be taxed.

Amanda Visser - Moneyweb
Treasury might want to ease up on Sars

Consistently setting unachievable revenue collection targets is unlikely to help the turnaround.

Tertius Troost - Moneyweb
Africa is being left out of the digital tax loop

It’s a tricky issue. Tech companies are able to operate internationally very effectively, zooming down fibre optic cables from their tax havens. Should they be taxed in a different way? It’s now a leading topic on the global agenda, and African tax experts are hustling to join the discussions. Governments around the world have proposed varying solutions. Africa, however, is not necessarily happy with the progress, but potential solutions are out there.

Ruan Jooste - Daily Maverick
A to-do list for the new Sars Commissioner

The President has entrusted Edward Kieswetter as the new Commissioner for the South African Revenue Service (Sars).

Jean du Toit - IOL