ABUSING TAX COURT PROCESSES WORK?
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ABUSING TAX COURT PROCESSES WORK?

[Durban, 03 March 2021] The full bench of the Western Cape High court recently delivered judgment¹ (Cloete J dissenting) in a favour of a taxpayer who, according to the Tax Court, was simply abusing process. When studying the judgment of the Tax Court, it is difficult to see how the taxpayer’s approach was anything more...

COVID-19:  HOME OFFICES AND TAX DEDUCTIONS
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COVID-19: HOME OFFICES AND TAX DEDUCTIONS

The media is rife with comments regarding the economic impact of the outbreak of the COVID-19 virus (the so-called “Coronavirus”) in South Africa. Many people have been asked, or is required, to work from home in order to curb the spread of the virus. Is there at least some form of tax break associated with...

TAX CLEARANCE CERTIFICATES: LAW CHANGES
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TAX CLEARANCE CERTIFICATES: LAW CHANGES

Law Changes The importance of a tax clearance certificate for most businesses cannot be overstated. It often happens though that SARS raises an assessment giving rise to an unexpected tax liability that affects the business’ tax standing. This, in turn, almost always adversely affects the business. Simply paying the extra tax assessed to ensure the...

THE EMPLOYEE’S BAD DEBT DEDUCTION
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THE EMPLOYEE’S BAD DEBT DEDUCTION

Many businesses are struggling to make ends meet. Unfortunately, in these circumstances, employers may be unable to pay salaries but nevertheless still issue IRP5 certificates indicating the salary to which the employee became entitled (despite the fact that it may not have been actually paid). This is often not well received by the employee when...

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SA Tax Penalties on Companies

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...

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Should deposits be included in gross income?

The question of whether deposits should be included in a taxpayer’s gross income has become a contentious topic in recent months following SARS’ increased interest in deposits. Taxpayers are, typically following submission of the ITR14 and subsequent IT14SD, requested to explain why deposits should not be included in gross income. In our view, the rationale...

TAX ON PROFIT ONLY?
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TAX ON PROFIT ONLY?

In layman’s terms, the general rule is that taxpayers who carry on a trade only pay tax on “profit” (taxpayers registered for turnover tax being one obvious exception to this rule) and not on all amounts received by or accrued to the taxpayer (or “gross income”).  Situations however arise from time to time where a...