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

Tax Practitioner Connect January 2019

SARS gratefully acknowledges the support from the tax practitioner community in 2018 and hope that we will continue to work together towards increased compliance and fiscal citizenship in 2019.

SARS
Register of all Binding General Rulings

Click here to view the register of all the Binding General Rulings.

SARS
Tax Guide for Small Businesses 2017/2018

This guide contains information about the tax laws and some other statutory obligations which apply to small businesses. It describes some of the forms of business entities in South Africa, namely sole proprietorships, partnerships, CC’s and private companies.

SARS

TAX CASES

Sasol Oil v CSARS (923/2017) [2018] ZASCA 153 (9 November 2018)

Contracts for the sale of crude oil by one entity within the Sasol Group, to another, and the back to back sale of the same oil to yet another entity in the group, were not simulated in order to avoid a liability to pay tax; nor were they entered into solely for the purpose of avoiding the payment of tax for the purpose of s 103(1) of the Income Tax Act 58 of 1962.

SARS Court Cases with compliments of Webber Wentzel
Commissioner for the South African Revenue Service v Digicall Solutions (Pty) Ltd (927/2017) [2018] ZASCA 137 (28 September 2018)

Income Tax Act 58 of 1962 – s 103(2) – taxpayer company – successive changes in shareholding in consecutive tax years – sole purpose from time of first change in shareholding to preserve and utilise assessed loss for set-off against future income – assessed loss carried over to next tax year – second acquisition of shares – income thereafter received by taxpayer – income indirect result of first acquisition of shares – set-off of assessed loss against income disallowed.

SARS Court Cases
C:SARS v Volkswagen S A (Pty) Ltd (1028/2017) [2018] ZASCA 116 (19 September 2018)

Income tax – valuation of stock at year end – s 22(1)(a) of Income Tax Act 58 of 1962 – whether stock to be valued in accordance with International Accounting Standard 2 (IAS 2 or AC 108) at net realisable value.

SARS Court Cases

Legislative & Policy
(National Treasury & Parliament)

BUDGET 2019

The Minister of Finance, Hon. Tito Titus Mboweni will table the 2019 Budget in Parliament on 20 February 2019 at 2pm. All the documents relating to the MTBPS, including the Minister's speech, will be available on this website as soon as the Minister starts speaking in Parliament. 

 

National Treasury
Budget Tips

The Minister of Finance would like to hear your thoughts, ideas and tips for the 2019 Budget. Click here to submit your tip.

 

National Treasury
Media statement: Warning regarding scammers

The Ministry of Finance would like to warn the public about scams which purport to be communication from the Ministry. In the latest of these scams, a person purporting to be the Deputy Minister of Finance has been asking people on Facebook for money in return for funding their projects or business plans. This person also asks for people’s full names, ID numbers, as well as home addresses. Neither the Ministry nor National Treasury assists individuals or businesses with the funding of their...

National Treasury

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

Draft public notice relating to the incidences of non-compliance by a person in terms of section 210(2) that are subject to a fixed amount penalty in accordance with section 210 and 211

The incidences of non-compliance, that are subject to a fixed amount penalty in accordance with section 210(1) and 211 of the Act, are listed for public comment.Next due date for comments: 30 October 2018

SARS
​Income Tax Act, 1962

Draft list of qualifying physical impairment or disability expenditure & Draft ITR-DD Form – Confirmation of Diagnosis of Disability. Next due date for comments: 5 November 2018

SARS
INVITATION FOR COMMENT ON THE DRAFT ANTI-AVOIDANCE OF TAX BILL, 2018

The Anti-Avoidance of Tax Bill aims to give SARS the necessary legal mechanisms to tackle aggressive and illegal avoidance.

Government Gazette

International and Regional News
(OECD and ATAF)

OECD Tax Talks

With a number of important recent and upcoming developments in the OECD's international tax work, we invite you to join senior members from the OECD's Centre for Tax Policy and Administration for the latest tax update.

International community makes important progress on the tax challenges of digitalisation

The international community has made important progress toward addressing the tax challenges arising from digitalisation of the economy and has agreed to continue working multilaterally towards achievement of a new consensus-based long-term solution in 2020, the OECD announced today.

OECD announces progress made in addressing harmful tax practices (BEPS Action 5)

Further progress has been made by the OECD/G20 Inclusive Framework on BEPS in implementation of BEPS measures against harmful tax practices (BEPS Action 5).

CPD Events

PROFESSIONAL INSIGHT

ITR14 must-knows

This article takes us through the process of accessing and completing the ITR14 return on eFiling.

Maya Nikolova - TaxTalk Magazine
Interest in the production of income

Since section 24O of the Income Tax Act came into effect in January 2013, interest incurred in respect of certain debts is deemed to be in the production of “income” and therefore tax deductible. Our article looks at subsequent changes and considers possible further amendments.

Esther Van Schalkwyk - TaxTalk Magazine
Foreign services exemption: Where are we now?

Over a year has passed since the bombshell dropped that rocked the expatriate community and advisors alike and yet there still seems to be little in the way of clarity around the operationalisation of the “new” section 10(1)(o)(ii) as it now stands.

Tarryn Atkinson - TaxTalk Magazine
PWC Tax Alert - Dutch “Most Favoured Nation”

Regular readers of our Tax Alerts will recall our previous Alert dated 4 September 2017 (Dividends Tax and Double Taxation Agreements: Dutch Most Favoured Nation Clause) (“the previous Alert”). In the previous Alert, we drew the attention of readers to the “most favoured nation” clause in the double taxation agreement between the Netherlands and South Africa (“the SA-Netherlands DTA). For some time, many taxpayers have taken the position that this clause (“the Dutch MFN clause”) can (when...

PWC
Is your tax objection late? Here’s what to do

SARS raises additional assessments all the time and for various reasons but mostly, an additional assessment, whether it be on VAT, income tax or PAYE is raised by SARS following an audit/verification.

Nico Theron - Unicus Tax Specialists SA
PWC Tax Alert - Fixed non-compliance penalties on Corporate Income Tax returns implemented

Government Notice No. 1372, published in Government Gazette No. 42100, provides for the imposition of fixed amount penalties in terms of sections 210 and 211 of the Tax Administration Act, 2011 (Act No. 28 of 2011) in respect of corporate income tax (“CIT”) returns.

PWC
SA tax penalties on companies

On 14 December 2018, the public notice that allows the South African Revenue Service (“SARS”) to impose penalties on companies for not submitting income tax returns was gazette. This is a new addition to the legion of penalties already faced by companies and permits the imposition of a monthly penalty on a company ranging from anything between R250 to R16 000 a month.

Nico Theron - Unicus Tax Specialists SA
New e-services regulations: widening invisible VAT net

In response to the ever-increasing world of e-commerce and cross-border digital trade, South Africa introduced legislation with effect from 1 June 2014 which requires foreign suppliers of e-services to register as value added tax (VAT) vendors. The National Treasury stated at the time that the amendment did not impose a new tax, but merely shifted the tax liability for e-services from the local recipient to the foreign supplier. South Africa was one of the first countries in the world to tax...

Gerhard Badenhorst & Varusha Moodaley - Cliffe Dekker Hofmeyr for International Law Office
Important judgment for taxpayers regarding the valuation of trading stock

In C:SARS v Volkswagen SA (Pty) Ltd (1028/2017) [2018] ZASCA 116 (19 September 2018) the Supreme Court of Appeal (SCA) dealt with important principles in the Income Tax Act, No 58 of 1962 (Act), specifically s22 of the Act dealing with amounts to be taken into account in respect of trading stock. The judgment will likely have far-reaching consequences for many taxpayers and this article provides a brief analysis of the key issues and principles underpinning the judgment.

Jerome Brink - Cliffe Dekker Hofmeyr

Tax News In The Press

The carbon tax is coming

After almost a decade of consultation, the carbon tax will come into effect on June 1, 2019.

Ingé Lamprecht - Moneyweb
It ain’t rocket science … know your tax compliance

There are many reasons why a taxpayer may want to know their tax compliance status. A taxpayer may, for example, require a Tax Clearance Certificate (TCC) for a tender or an emigration application. 

Graeme Palmer - IOL
Ramaphosa signs 3 tax bills, sets effective dates for Budget 2018 tax changes

The signing of three tax bills into law by President Cyril Ramaphosa on Thursday brought to an end the 2018 legislative cycle and set the effective dates for the tax changes proposed in the February Budget.

Amanda Visser - IOL
12 questions investors ask on the Section 12J tax incentive

As South Africans return to work in 2019, many will be considering whether to reduce their February tax liability by taking advantage of the Section 12J tax deduction. For every R100 invested in a Section 12J company an investor (individuals, companies and trusts) can reduce their tax by up to R45 making the net investment only R55.

Jonti Osher and Dino Zuccollo - IOL
The taxing issue of SA’s finances

Has there been a substantial deterioration in the economic environment that could warrant tax hikes?

Ingé Lamprecht - Moneyweb
SARS Rissik Street Branch Reopened

The SARS Rissik Street branch has been reopened after being temporarily closed due to structural damage after flooding. The branch is once again fully operational as from 16 January 2018.

SARS