Reviewing the record of review
In a judgment delivered on 17 February 2020, the Gauteng High Court dealt with a matter regarding a “record of review”, and its relevance relating to a review application brought by the Applicant in the matter, Medtronic International (“Medtronic”), on the refusal by the South African Revenue Service’s (“SARS”) refusal to reduce certain interests and […]
Re-allocation of surplus retirement fund assets
Binding Class Rulings (BCR) are issued in response to applications by a specific class of taxpayers (usually persons that will have the same tax consequences apply to them from a transaction) and clarifies how the Commissioner for SARS would interpret and apply the provisions of the tax laws relating to a specific proposed transaction. BCR 068 determines the very technical consequences of transferring surplus retirement fund assets between funds and allocating […]
VAT exemption for `essential goods’ for the duration of the shutdown
SARS has changed the definition of `essential goods’ as per the Disaster Management Act 57 of 2002, and the Regulation R.398 in Government Gazette No 43148 of 25 March 2020. These Regulations will apply as from 26 March 2020 at 24H00 until 16 April 2020 at 24H00, or on a date to be determined by […]
Expats are forced to pay their dues
In a recent Supreme Court of Appeal decision, the court had to determine whether the payment by an employer to tax consultants for providing assistance to the employer’s expatriate employees constituted a taxable benefit, as contemplated in the definition of “gross income” in section 1 of the Income Tax Act[1] read with section 2(e) or (h) […]
2019 Tax Recap
As the year draws to a close, we reflect on some of the significant highlights (and lowlights) of the 2019 tax year. Significant judgments Our courts delivered several, precedent-setting judgements during 2019: Africa Cash & Carry: In November, the Supreme Court of Appeal (SCA) dismissed the appeal by Africa Cash and Carry, in respect of a […]
To deduct or not to deduct?
Section 24C of the Income Tax Act[1] (hereinafter referred to as “the Act”) allows a deduction, from income, received by or accrued to a taxpayer in terms of any contract, to finance future expenditure which will be incurred by the taxpayer in fulfilling its obligations in the performance of such contract. On 3 December 2019, the […]
Taxation of Foreign Employment Income
South Africa has a residence-based tax system, which means residents are taxed on their worldwide income, regardless of where that income was earned. South African tax residents living overseas and earning remuneration in respect of services rendered outside of South Africa are exempt from tax in South Africa, provided that the individual is outside of South Africa for a period or periods exceeding 183 full days (60 of which have to […]
What are VAT supplies and how does it affect your VAT return
There are a few instances where VAT is not charged at the standard rate of 15%. In the following newsletter, we distinguished between the different supplies that attract VAT but does not necessarily have the impact of a standard rate supply. Denied Supplies The VAT Act provides for certain expenses where input VAT is denied, […]
2019 Tax Season: Are you ready?
SARS recently released two media statements, in which it notes several improvements made to eFiling for the 2019 tax season, including the issue of customised notices indicating specific documents required in the event of an audit or verification and a simulated outcome issued before a taxpayer has filed.What is the tax season? Tax season is […]
Rendering of transport services by employers
Paragraph 2(e) of the Seventh Schedule to the Income Tax Act[1] deems an employer to grant a taxable benefit to an employee if any service has, at the expense of the employer, been rendered to the employee for his or her private or domestic use. The taxable benefit which arises in this instance is valued […]