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...
Many seem to be surprised by comments in the 2020 Budget Review documents released on 26 February 2020 to the effect that financial emigration status and tax residency status are not synonymous. There also seems to be confusion about the impact on a person’s tax residency status if, as mentioned in the 2020 Budget, the...
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...
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...
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...
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...
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...
Unlisted public companies may want to convert from public to private companies for various reasons. Often times it is the free transferability of shares that cause a concern where there is disagreement at shareholder level and the risk of having a third party introduced as shareholder becomes high. Where such a conversion is indeed pursued,...
