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FEATURED EVENT: 2019 Budget Review Trilogy

You are invited to attend the 2019 Budget Review Trilogy to find out what South Africa’s economic future holds for you and your business. The event will be held at three regional venues for your convenience: Cape Town, Durban and Johannesburg. Click here to book now.

Tax Conference
SAIT Member Forum

SAIT members have the benefit of joining an online community to interact with other members and discuss pertinent tax-related topics. To access the forum, go to the SAIT website (www.thesait.org.za), click on the ‘Tax Technical’ tab and select the ‘Professional Forum’ option. From there you will be able to access different topics in the forum, join topics that are relevant to you or even start your own topic. Note that this forum is for...

SAIT Technical

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

BPR 318 - Corporatisation of a collective investment scheme in property

This ruling determines the tax consequences arising out of the conversion of a collective investment scheme in property to a corporate REIT in accordance with the procedure set out in Notice 42 of 2014 issued by the Registrar of Collective Investment Schemes under the Collective Investment Schemes Control Act 45 of 2001.

SARS
Memorandum on the Objects of the Tax Administration Laws Amendment Bill 2018

The Tax Administration Laws Amendment Bill, 2018 (the ‘‘Bill’’), proposes to amend the Income Tax Act, 1962, the Customs and Excise Act, 1964, the Value-Added Tax Act, 1991, the Securities Transfer Tax Act, 2007, the Tax Administration Act, 2011, and the Customs Control Act, 2014.

SARS
BPR 316 Amalgation of companies in terms of Business Rescue Plan

This ruling determines the income tax and value-added tax effect of an amalgamation transaction for consideration involving the assumption of liabilities only.

SARS

TAX 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
TCIT 13988 CPT 1 November 2018

Income tax; section 24C; loyalty programme; whether the Appellant was entitled to a section 24C allowance in respect of a loyalty programme it administered

SARS Court Cases
ABC (Pty) Ltd and C:SARS (IT14426) - 13 December 2018

This appeal is concerned with the application of provisions of the Employment Tax Incentive Act 26 of 2013 (the Act), which provides for an employment tax incentive (“ETI”) in the form of a deduction from the employees’ tax (“PAYE”) payable to the employer to support the creation of new jobs for employees under the age of 30 years.

SARS Court Cases

Legislative & Policy
(National Treasury & Parliament)

Carbon Tax Bill: finalisation & voting; Financial Matters Amendment Draft Bill: briefing

The Committee met with the National Treasury for finalisation and adoption of the Carbon Tax Bill. The Committee also received a briefing and discussed the Financial Matters Bill.

Parliamentary Monitoring Group
Media statement: Process for appointing SARS Commissioner

The Minister of Finance, Mr Tito Mboweni, has appointed a panel to interview and recommend to the President of the Republic of South Africa a shortlist of candidates for the position of the Commissioner of the South African Revenue Service (SARS).

National Treasury
Media Advisory: Save the date - Media Workshop

As part of equipping journalists with information to help them with their reporting of the Budget and related issues, Treasury will host a media workshop on 19 February 2019. Details of what will be presented at the workshop will follow in due course.

Treasury

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

Income Tax Act, 1962​​

Draft Binding General Ruling – Transitional rules for the taxation of interest payable by SARS under section 7E. Next due date for comments:15 March 2019 New!

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)

OECD invites public input on the possible solutions to the tax challenges of digitalisation

As part of the ongoing work of the Inclusive Framework on BEPS, the OECD is seeking public comments on key issues identified in a public consultation document [add link to PDF] on possible solutions to the tax challenges arising from the digitalisation of the economy.

Mauritania joins international efforts against tax evasion and avoidance

Today, at the OECD Headquarters in Paris, H.E. Aichetou Mint M’Haiham, Ambassador of Mauritania to France, signed the Multilateral Convention on Mutual Administrative Assistance in Tax Matters (the Convention) in the presence of the OECD Deputy Secretary-General Ludger Schuknecht. Mauritania is the 127th jurisdiction to join the Convention.

Guernsey deposits its instrument of ratification for the Multilateral BEPS Convention

Today, Guernsey deposited its instrument of ratification for the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (multilateral convention or MLI) with the OECD’s Secretary-General, Angel Gurría, thus underlining its strong commitment to prevent the abuse of tax treaties and base erosion and profit shifting (BEPS) by multinational enterprises.

CPD Events

PROFESSIONAL INSIGHT

Africa tax in brief

AFRICAN UNION: African Continental Free Trade Area Agreement developments

Celia Becker - ENSafrica
New tax change taxes dividends in a collective investment scheme

Dividends declared by South African resident companies or non-resident companies, the shares of which are listed on a South African exchange, are subject to dividends tax of 20%. The tax liability in the case of a cash dividend is that of the beneficial owner of the dividend. The beneficial owner is the person entitled to the benefit of the dividend attaching to a share. If it is a cash dividend, then the company declaring the dividend has to withhold the dividends tax and pay it over to the...

Magda Snyckers - ENSafrica
Win for the employer: Judgment on the Employment Tax Incentive Act

In the recent case of ABC (Pty) Ltd v The Commissioner for the South African Revenue Service (Case No 14426) (as yet unreported), the Tax Court was required to decide whether ABC (Pty) Ltd (Taxpayer) could claim the employment tax incentive (ETI) in terms of the Employment Tax Incentive Act, No 26 of 2013 (Act) in respect of certain periods. In deciding the matter, the court not only considered the provisions of the Act, but also considered and applied various principles of South...

Louis Botha & Louis Kotze - Cliffe Dekker Hofmeyr
Finality to Debt Benefit Rules

The Taxation Laws Amendment Act, 2018 (“TLAA”), which was promulgated on 17 January 2018, amended South African tax legislation by overhauling two provisions relating to the reduction of debt, (the “Debt Benefit Rules”), namely section 19 of the Income Tax Act, 1962 (the “ITA”) and paragraph 12A of the Eighth Schedule to the ITA (the “Eighth Schedule”). This article will examine the notable areas where the legislation per the TLAA differs and the importance of the timing of the application...

Siyanda Gaetsewe - ENSafrica
PWC Tax Alert - Carbon tax developments

On Tuesday, 5 February 2019, the Standing Committee on Finance adopted the Carbon Tax Bill. The Bill will now head towards the parliamentary vote process. In addition, the draft Customs and Excise Amendment Bill will be tabled in parliament on 20 February 2019 along with the 2019 Budget.

PWC
PWC Synopsis: Tax Today - January 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
When must a reportable arrangement be disclosed to SARS?

Under the Tax Administration Act, No 28 of 2011 (TAA) persons who enter into certain types of transactions must report the details of those transactions to SARS. These types of transactions are called “reportable arrangements”.The list of transactions that must be reported are set out in s35(1) of the TAA, and in s35(2) of the TAA as read with a SARS notice issued pursuant to that provision.

Ben Strauss - Cliffe Dekker Hofmeyr
The latest news on transfer pricing

In this newsletter you'll find: Regional news: updates from Algeria, Benin, Cameroon, Chad, Morocco, Tanzania, Tunisia and Zambia, TP focus for January: Botswana, ...

Graphene Economics Team
One less issue when issuing tax invoices

A tax invoice plays a pivotal role in the VAT system for suppliers and recipients alike. In terms of the Value-Added Tax Act, No 89 of 1991 (VAT Act), a supplying vendor is obliged to issue a tax invoice that complies with the requirements of the VAT Act within 21 days of making a taxable supply to a recipient. Similarly, a recipient vendor will only be entitled to claim an input tax deduction in respect of a VAT cost incurred for the purpose of making taxable supplies, to the extent that he...

Varusha Moodaley - Cliffe Dekker Hofmeyr

Tax News In The Press

Tax revenue could miss mini-budget forecast by more than R10bn

Tax revenue for the current fiscal year could fall short of the medium-term budget policy statement (MTBPS) forecast by at least R10 billion after corporate and personal income tax collection slowed in the last few months of 2018.

Ingé Lamprecht - Moneyweb
Appointment of Sars commissioner imminent

Finance minister Tito Mboweni has appointed a panel to interview candidates and to recommend a suitable candidate for the top job at the South African Revenue Service (Sars).

Ingé Lamprecht - Moneyweb
Is SA’s corporate tax rate too high?

There have been calls to lower South Africa’s corporate income tax rate to improve the country’s relative competitiveness and to ignite economic growth.

Ingé Lamprecht - Moneyweb
What’s next for tax-free savings accounts?

Almost four years have passed since National Treasury introduced tax-free savings accounts (TFSAs) to improve South Africa’s dismal savings rate.

Ingé Lamprecht - Moneyweb
Sars under pressure to flex its muscles

The South African Revenue Service (Sars) is likely to come under increasing pressure to improve efficiency and up its enforcement efforts in the year ahead.

Ingé Lamprecht - Moneyweb
Too much tax can be a killer

US economist Arthur Laffer, the man behind the famous Laffer curve– which suggests that there is a point where tax increases become counterproductive and yield less income for the state – wants to visit South Africa to share his ideas with policymakers.

Riana de Lange - City Press