Category: Tax (page 1 of 11)

NUWE INDIENINGVEREISTES VIR INSOLVENTE BELASTINGBETALERS

Die Suid-Afrikaanse Inkomstediens (“die SAID”) het onlangs nuwe prosedures uiteengesit met betrekking tot die proses rondom die indiening van inkomstebelastingopgawes wat verband hou met insolvensie. Die verstekposisie is dat waar die boedel van ’n persoon gesekwestreer word, moet ’n afsonderlike opgawe ingedien word vir die tydperk wat begin op die eerste dag van daardie jaar van aanslag en eindig op die datum wat die datum van sekwestrasie voorafgaan. ’n Verdere opgawe word benodig vir die tydperk wat begin op die datum van sekwestrasie en eindig op die laaste dag van daardie jaar van aanslag (en daaropvolgende jare van aanslag totdat die boedel uiteindelik gelikwideer is). In wese is dus drie afsonderlike belastingbetalers aanspreeklik vir belasting, naamlik:

  • Die insolvente persoon vir die tydperk voor insolvensie (dit wil sê, tot die datum wat die datum van sekwestrasie voorafgaan);
  • Die insolvente boedel (’n nuwe entiteit vir belastingdoeleindes vanaf die datum van sekwestrasie); en
  • Die insolvente persoon vir die tydperk op en na die datum van sekwestrasie.

Die SAID dui aan dat die nuwe vereistes: “in lyn is met die strategiese doelwitte van die SAID, verhoogde belastingaanspreeklikheid en die toenemende gerief en billikheid rakende die doen van sake met die SAID, en om aan wetlike vereistes te voldoen, is veranderinge aan die huidige prosesse nodig ten opsigte van registrasie, instandhouding en die bestuur van die status van ’n insolvente individu en boedel”.

Vanaf 25 Januarie 2019 moet individuele belastingbetalers wat vrywillig of verpligtend gesekwestreer word, inkomstebelastingopgawes op die volgende wyse indien:

  • Insolvente individu – Die belastingverwysingsnommer wat voor sekwestrasie gebruik is, sal gesluit wees en kan nie voortaan meer gebruik word nie. Enige inkomstebelastingopgawes wat uitstaande is voor die datum van sekwestrasie, moet ingedien word deur gebruik te maak van die inkomstebelastingverwysingsnommer wat gebruik is voordat u insolvent verklaar is;
  • Insolvente boedel – Die trustee van ’n insolvente boedel moet aansoek doen om ’n belastingverwysingsnommer vir die insolvente boedel. Die nuwe belastingverwysingsnommer sal dan gebruik word vir enige interaksies met die SAID vanaf die datum van sekwestrasie tot aan die einde van die laaste dag van daardie jaar van aanslag; en
  • Individu na-insolvensie – U moet aansoek doen vir ’n nuwe inkomstebelastingverwysingsnommer sodra u insolvent verklaar is ten einde met die SAID te kommunikeer ten opsigte van belasting waarvoor u aanspreeklik mag wees en opgawes wat u moet indien.

Die boedel van die persoon voor sekwestrasie en die persoon se insolvente boedel word egter geag een en dieselfde persoon vir sekere doeleindes te wees, byvoorbeeld die bepaling van die aftrekkings en kortings waarop die insolvente boedel geregtig is en die bepaling van ’n belasbare kapitaalwins of aangeslane kapitaalverlies in die insolvente boedel. Dit beteken ook dat daar geen beskikking vir kapitaalwinsbelastingdoeleindes is wanneer die bates van die insolvente persoon na die insolvente boedel oorgedra word nie.

Soos blyk uit bogenoemde, is die belastinghantering (beide wesenlik en prosedureel) van insolvensie ingewikkeld, en belastingbetalers word aangeraai om professionele bystand te kry wanneer hulle hul belastingsake tydens insolvensie hanteer.

Hierdie artikel is ʼn algemene inligtingsblad en moet nie as professionele advies beskou word nie. Geen verantwoordelikheid word aanvaar vir enige foute, verlies of skade wat ondervind word as gevolg  van die gebruik van enige inligting vervat in hierdie artikel nie. Kontak altyd ʼn finansiële raadgewer vir spesifieke en gedetailleerde advies. (E&OE)

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DEREGISTRASIE VAN OMSETBELASTING

Die Sesde Skedule van die Wet op Inkomstebelasting[1] detailleer die werking van die omsetbelastingstelsel wat op mikrobesighede van toepassing is. Omsetbelasting is ’n opsionele stelsel (met voorkeur-belastingkoerse) en is in wese ’n vereenvoudigde belastingstelsel wat beskikbaar is vir mikrobesighede (besighede met ’n kwalifiserende omset van R1 miljoen of minder). Die Sesde Skedule handel oor persone wat kwalifiseer as mikrobesighede (wat natuurlike persone insluit), die toelaatbare aandele en belange wat die mikrobesighede mag besit en wat belasbare omset en uitsluitings daarvan, uitmaak. Alhoewel die stelsel wyd gebruik word, is daar ’n toenemende aantal belastingbetalers vir wie die stelsel nie meer optimaal is nie, en wat wil deregistreer en onderhewig wees aan die “normale belastingstelsel”.

Ingevolge paragraaf 9 van die Sesde Skedule is daar twee gronde waarop ’n persoon vir omsetbelasting gederegistreer kan word:

  1. Vrywillige deregistrasie

Vrywillige deregistrasie vind plaas wanneer die eienaar van ’n geregistreerde mikrobesigheid verkies om onder die “normale belastingstelsel” belas te word en kies om te deregistreer vir die omsetbelastingstelsel. ’n Vrywillige deregistrasie is toelaatbaar indien die belastingpligtige voor of aan die einde van ’n jaar van aanslag (28 of 29 Februarie) skriftelik kennis gee aan die Kommissaris. Deregistrasie sal van krag wees vanaf die begin van die volgende jaar van aanslag. Byvoorbeeld, ’n geregistreerde mikrobesigheid wat gekies het om te deregistreer vir die omsetbelastingstelsel deur op 21 Januarie 2019 ’n kennisgewing by die Kommissaris in te dien, sal met ingang 1 Maart 2019 (dit wil sê die belastingjaar 2020) gederegistreer word. Daar is tans geen voorgeskrewe vorm wat vir die kennisgewing gebruik moet word nie en daar word aanbeveel dat belastingbetalers hul naaste SAID-tak besoek en ’n formele versoek indien om te deregistreer (of hul belastingpraktisyn om hulp nader).

  1. Verpligte deregistrasie

Verpligte deregistrasie sal plaasvind indien ’n geregistreerde mikrobesigheid nie meer kwalifiseer om as sodanig geregistreer te wees nie. Twee faktore kan ’n verpligte deregistrasie noodsaak, naamlik

  1. as die kwalifiserende omset wat deur die mikrobesigheid verkry word uit besigheidsaktiwiteite gedurende ’n jaar van aanslag, die drempel van R1 miljoen oorskry of waarskynlik sal oorskry en die besigheid nie kan aantoon dat dit ’n nominale en tydelike gebeurtenis sal wees nie; of
  2. die persoon gediskwalifiseer word op grond van die bron van sy omset (byvoorbeeld professionele dienste) of die beleggings wat hy het.

’n Geregistreerde mikrobesigheid wat onderhewig is aan verpligte deregistrasie moet die SAID binne 21 dae vanaf die datum waarop dit nie meer as ’n mikrobesigheid kwalifiseer nie, in kennis stel. Versuim om die SAID in kennis te stel kan lei tot boetes wat teen die belastingpligtige gehef word.

Belastingbetalers moet ook onthou dat deregistrasie vir omsetbelasting ander administratiewe vereistes kan hê waaraan aandag gegee moet word, byvoorbeeld heroorweging van sy BTW-posisie, inkomstebelastingposisie, voorlopige belasting en ander nakoming.

[1] No. 58 van 1962

Hierdie artikel is ʼn algemene inligtingsblad en moet nie as professionele advies beskou word nie. Geen verantwoordelikheid word aanvaar vir enige foute, verlies of skade wat ondervind word as gevolg  van die gebruik van enige inligting vervat in hierdie artikel nie. Kontak altyd ʼn finansiële raadgewer vir spesifieke en gedetailleerde advies. (E&OE)

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TAX IMPLICATIONS OF THE VARIATION OF EMPLOYMENT CONTRACTS

On 6 November 2018, the South African Revenue Service (“SARS”) issued a binding private ruling (“BPR 312”) in accordance with sections 78(1) and 87(2) of the Tax Administration Act.[1] This ruling set out the tax implications of varying employment contracts.

Here the applicant (a resident company) previously entered a profit share arrangement with Mr X, who was entitled to nominate certain employees (of two 100% held subsidiaries of the applicant) to also benefit from this arrangement. The parties subsequently entered into a cancellation agreement to terminate the profit share arrangement and to allow for certain payments to be made by the subsidiaries to the nominee employees.

Although the payments (and the subsequent tax implications thereof in terms of the Income Tax Act[2]) seems standard for this type of agreement, the ruling neatly confirms these implications of each of these payments for both the subsidiaries and the employees.

Firstly, the subsidiaries would pay a pre-determined cancellation fee to the affected employees as compensation for cancelling the profit share arrangement, including payments to other employees pursuant to the cancellation agreement even though they were not applicants to the ruling or parties to the cancellation agreement. The ruling confirmed that both these payments were deductible for income tax purposes under the general deduction formula.[3]

Secondly, a cash portion was retained by the applicant to be released to Mr X in August 2021. This amount was treated as security for Mr X to comply with certain obligations he had in terms of these agreements. The cash portion will be forfeited if Mr X is dismissed prior to the date of release.

SARS confirmed that the cash portion was a pre-payment subject to section 23H in the hands of the applicant.  Also, that both the cancellation fee and the retained cash portion should be included in the employees’ gross income.[4] Mr X will, however, qualify for a tax deduction should the amount be forfeited in terms of section 11(nA), which allows for a deduction of any voluntary award received by virtue of employment that was included in taxable income but is subsequently refunded.

Lastly, the cancellation agreement made provision for agreements that allowed for restraint of trade payments to be made to certain employees. The subsidiaries could deduct these amounts in terms of section 11(cA) while these payments were to be included in their gross income in terms of paragraph (cB) of the definition of “gross income” in section 1.

[1] No. 28 of 2011.

[2] No. 58 of 1962. Any subsequent references to “sections” are to the sections of this Act.

[3] Section 11(a) read with section 23(g).

[4] Paragraph (d) of the definition of “gross income” in section 1 which specifically allow for a payment as a result of a variation of employment.

This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice.  Errors and omissions excepted (E&OE)

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ZERO-RATING OF SERVICES TO NON-RESIDENTS

South African value-added tax (VAT) vendors are often unsure of the tax consequences of issuing invoices to foreign customers or clients and whether such services should be invoiced at the standard rate of 15% or be zero-rated. As is generally the case with tax (especially VAT), the answer is that it depends on the circumstances. Therefore, it is quite possible that services to a non-resident can be invoiced at the standard rate, or at a zero-rate.

Importantly, section 11 of the VAT Act,[1] which deals with the zero-rating of supplies, distinguishes between the supply of goods (section 11(1)) and services (section 11(2)). The default position in terms of section 11(2)(l), is that services rendered to persons who are not residents in the Republic should be made at the zero-rate. There are, however, three exceptions to this default rule, and specifically where the services are supplied directly:

  • in connection with land or improvements in the Republic;
  • in connection with moveable property situated in SA at the time that the service is rendered (except if the moveable property will be exported after the service, or forms part of a supply by the person to the vendor and the services are for the purpose of that supply); and
  • the person or any other person is in the Republic at the time the service is rendered.

The circumstances of the service should be tested against each rule, meaning that you cannot simply zero-rate a service if you meet only one of the criteria. All three tests should be met independently to zero-rate the service. This confirms the principle that the purpose of section 11(2)(l) is to ensure that when services are consumed in South Africa, VAT is payable at the standard rate.

The rules and exceptions in section 11(2)(l) are, however, still subject to some interpretation, especially if considered that for services to be at the standard rate of 15%, it should be directly in connection with one of the exceptions noted above. Accordingly, there is some debate on what constitutes directly.

There are, however, several court cases and interpretation notes available to provide taxpayers with some guidance:

  • Master Currency v CSARS 2014 (6) SA 66 (SCA);
  • XO Africa Safaris v CSARS (395/15) [2016] ZASCA 160;
  • SARS Interpretation Note 81; and
  • SARS Interpretation Note 85.

Taxpayers should also ensure that they comply with the documentation requirements for the zero-rating of services, which is at a minimum the following:

  • tax invoice;
  • written confirmation from the recipient that it is not a resident of the Republic;
  • proof of payment; and
  • proof of export (in respect of moveable goods) or a statement from the non-resident that the non-resident or any other person is not present in the Republic at the time that the services are rendered.

[1] The Value-Added Tax Act No. 89 of 1991

This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice.  Errors and omissions excepted (E&OE)

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2018: A YEAR IN TAX

As 2018 has come to an end, we reflect on some of the significant highlights (and lowlights) of the 2018 tax year.

Davis Tax Committee concludes its work

The Davis Tax Committee (DTC) was appointed by the Minister of Finance in 2013, to inquire into the role of the tax system in the promotion of inclusive economic growth, employment creation, development and fiscal sustainability. The committee published several in-depth reports, including VAT, corporate income tax, capital gains and wealth taxes. Many of their recommendations will undoubtedly be considered in the years to come. On 27 March 2018, after five years, the DTC held its final meeting. All reports are available at http://www.taxcom.org.za/library.html.

Significant judgements

Two important, precedent-setting judgements were delivered by our courts during 2018:

  • Sasol Oil: In November, the Supreme Court of Appeal (SCA) found in Sasol’s favour when SARS challenged several transactions that they concluded, on the grounds that the transactions were simulated. The court re-affirmed the tests to be applied to determine if transactions are simulated and entering the realm of tax evasion. This was an R1.3 billion win for the taxpayer.
  • Volkswagen: Regarding the valuation of trading stock, the SCA indicated that valuing stock at net realisable value was contrary to two fundamental principles. Firstly, taxable income is determined from year to year by looking at events that have taken place during that year so that tax is backward-looking, while the net realisable value is forward-looking. Secondly, the effect of using net realisable value is that expenses that will only be incurred in a future year in the production of taxable income in that future year would become deductible in an earlier tax year. On this basis, the court found in SARS’s favour.

Changes to the Act

The yearly legislative cycle ended when the Taxation Laws Amendment Bill was published on 24 October 2018, ending a process that started with the Budget Speech in February. 94 organisations and individuals provided valuable inputs and comments on the draft bill, on issues ranging from venture capital companies to debt reduction. As always, the input from the public and organisations significantly shaped the amendments to the law.

Nugent Commission

In May, a commission into tax administration and governance at SARS was appointed under the leadership of Retired Justice Robert Nugent. Several concerning revelations have been made, which has led to the dismissal of Tom Moyane as Commissioner. A final report from the Commission is due shortly – which will hopefully set the scene for positive changes at SARS.

VAT increase and review

On the back of an increase in the VAT rate to 15% on 1 April 2018, a review was undertaken by a panel of experts on the zero-rating of several goods. It was finally decided that white bread flour, cake flour and sanitary pads will be zero-rated from 1 April 2019, at a revenue loss of R1.2 billion to the fiscus. 

Tribute

Sadly, two respected personalities in the tax fraternity passed away in 2018. Professors Matthew Lester and Lynette Olivier will be remembered for their valuable contributions to the field of tax over many years, both in academics and in commerce. Their works will continue to serve as authoritative sources for many years to come.

Undoubtedly, 2019 will bring as many, if not more exciting changes to the world of tax. It will be particularly interesting to see the political impact on our tax system, given that we are heading into an election year.

This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice.  Errors and omissions excepted (E&OE)

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SAID rente op voorlopige belasting

Soos met verskeie ander saketransaksies, trek belasting in sy verskillende vorme ook rente aan, óf betaalbaar deur die belastingbetaler aan die SAID, óf aan die belastingbetaler verskuldig deur die SAID. Benewens om te weet watter van die verskillende SAID-rentekoerse van toepassing is (wat dikwels op sigself ’n uitdaging is), word dit toenemend belangrik om te weet in watter omstandighede rente van toepassing is, asook die relevante inkomstebelastinghantering van daardie rente. Hierdie artikel ondersoek een só ’n scenario: voorlopige belasting.

Oorbetaling van voorlopige belasting

Indien ’n belastingbetaler enige belastingkrediet het (die bedrag waarmee die belasting wat reeds betaal is die berekende belastingaanspreeklikheid oorskry) en daardie krediet R10 000 te bowe gaan, of die belastingbetaler ’n belastingkrediet het en die belasbare inkomste ’n bepaalde bedrag oorskry (R50 000 vir individue en trusts en R20 000 vir maatskappye), verdien die belastingbetaler rente teen die voorgeskrewe koers, naamlik 6% (vergeleke met die 10% wanneer rente aan die SAID betaalbaar is. (Kyk meer besonderhede hieronder).

Daaropvolgende inkomstebelastinghantering

Rente verdien van die SAID sal ingesluit word in die bruto inkomste van ’n belastingbetaler en is dus ten volle belasbaar (onderworpe aan enige jaarlikse rentevrystellings vir natuurlike persone). Alhoewel inkomstebelasting oor die algemeen volgens die beginsels van ontvangs en toevalling werk, bepaal artikel 7E van die Wet spesifiek dat enige rente wat deur die SAID aan ’n belastingbetaler verskuldig is, slegs as toegeval geag sal word op die datum waarop dit betaal is aan (ontvang word deur) ’n belastingbetaler. Alhoewel dit minder wesenlik vir individue is, kan dit lei tot verskille in hantering vir maatskappye en moontlik aanleiding gee tot uitgestelde belasting.

Onderbetaling van voorlopige belasting

As ’n belastingbetaler se normale belastingverpligting enige belastingkrediet oorskry en die belasbare inkomste ’n bepaalde bedrag oorskry (R50 000 vir individue en trusts en R20 000 vir maatskappye), sal rente deur die SAID teen die voorgeskrewe koers gehef word – tans 10%. Rente is ook betaalbaar teen die voorgeskrewe koers van 10% op laat betalings ten opsigte van eerste, tweede en derde voorlopige belastingperiodes.

Daaropvolgende inkomstebelastinghantering

Artikel 23(d) verbied die aftrekking van belasbare inkomste van enige rente betaal kragtens enige wet wat deur die SAID geadministreer word. Daarom sal enige rente wat aan die SAID betaal word, nie aftrekbaar wees vir inkomstebelasting nie. Vermoedelik is dit omdat hierdie rente nie beskou sal word as verkry in die produksie van inkomste of bestee vir die doeleindes van ’n bedryf nie.

Gegewe die wyd-gepubliseerde vertragings van terugbetalings vir verskillende soorte belasting, behoort belastingbetalers hulle rekeningstate van die SAID noukeurig na te gaan om te verseker dat die rente waarop hulle geregtig is ingevolge die verskillende belastingwette, aan hulle betaal is. Belastingbetalers behoort ook deeglik kennis te neem van die sperdatums vir voorlopige belastingbetalings om te verseker dat rente nie op laat betalings of enige onderbetalings aangegaan word nie.

Hierdie artikel is ʼn algemene inligtingsblad en moet nie as professionele advies beskou word nie. Geen verantwoordelikheid word aanvaar vir enige foute, verlies of skade wat ondervind word as gevolg  van die gebruik van enige inligting vervat in hierdie artikel nie. Kontak altyd ʼn finansiële raadgewer vir spesifieke en gedetailleerde advies. (E&OE)

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REGISTRATION OF A TRUST AS A TAXPAYER

The frustration experienced by taxpayers and the complexity of registering a trust as a taxpayer with the South African Revenue Service (SARS), has been widely publicised in recent years. Despite calls from industry bodies for a simplified approach (like companies and individuals), registering a trust as a taxpayer remains an overly complex process.

The inconsistency of information received by taxpayers between the SARS website and different branch offices is one of the areas of major concern. SARS’ website, for example, indicates that either certified or uncertified copies of identity documents are acceptable, whereas branch officers only accept certified copies. Another frustration is requirements that are seemingly not in line with legislation. As an example, SARS requires the appointment, by resolution, of a so-called “main trustee”, whereas the concept of a “main trustee” does not exist in the Trust Property Control Act 57 of 1998. The same act requires that a separate bank account must be used for deposits received by persons in their capacity as trustees of a trust, but SARS seemingly requires some trusts to have bank accounts while not imposing this requirement on others during registration.

Based on recent interactions with SARS, the following guidelines should assist taxpayers in registering trusts as a taxpayer. Although many of the requirements do not seem to agree with what is required by legislation (or sometimes common sense), a call on such formal matters at a branch office will not assist taxpayers and they should rather ensure that the documents below are at hand. All the documents indicated below must be in a certified form:

  • A completed IT77TR form (available on the SARS website);

  • A resolution appointing one of the trustees a “main trustee”. Even if this is indicated in a trust deed, it must be specifically resolved. It is suggested that it is this “main trustee” that represents the trust at the SARS branch office;

  • A resolution authorising the said “main trustee” to sign all documents on behalf of the trust for purposes of registering it as a taxpayer with SARS;

  • Identify documents of all trustees (if you use the new smartcard ID document, ensure that both the front and the back are copied). Note that the trustee doing the registration, must also have their original identity document at the branch;

  • Proof of address for all trustees (ensure that this address on the proof agrees to what is completed on the IT77TR form);

  • Proof of address of the trust. For these purposes, use the CRA01 available on the SARS website to accompany the proof of address. It is suggested that two versions of the CRA01 are completed. One by the “main trustee” and one by a different trustee, since different branch offices require different trustees to complete the form;

  • Proof of banking details. If the bank account is less than one month old, then a letter from the bank confirming that the details are in order. In all other cases, a bank statement is required;

  • The trust deed; and

  • The letter of authority from the Master’s Office.

For good measure it is suggested, if possible, to take all original documents along to the branch as well (only present these if required and ensure it is returned). Also, ensure that a proof of registration and the taxpayer reference number of the trust is obtained after successful registration.

This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice.  Errors and omissions excepted (E&OE)

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BAD DEBTS AND VAT

While there is currently a focus on the income tax considerations of bad and doubtful debts (given that National Treasury has proposed changes to section 11(j) of the Income Tax Act[1] to allow for an allowance of 25% of impairments in respect of doubtful debts), the Value Added Tax (VAT) aspect of bad debts is often overlooked.

Section 22 of the Value Added Tax Act[2] determines that a VAT vendor who accounts for VAT on the invoice basis may deduct input tax in respect of debts which have become irrecoverable and written off. To be able to claim the input tax deduction, three requirements should be met:

  1. There must have been a taxable supply for a consideration in money;
  2. The vendor must have already properly accounted for the output VAT on that supply; and
  3. The vendor must have written off the amount of the consideration that has become irrecoverable.

The first two requirements should be relatively easy to meet since they generally occur in the ordinary course of business. The final requirement may potentially be more difficult to substantiate.

The VAT Act does not provide any further guidance on what constitutes “irrecoverable” or “written off”. A similar hurdle is present in the Income Tax Act, that does not elaborate on what the meaning is of debt that has become “doubtful” and debt that has “become bad”. Arguably, the requirements in the VAT Act stating that the debt must be “written off”, goes a step further than debt that is merely “doubtful” or that has “become bad”. It is also not certain to what extent the South African Revenue Service could draw comparisons between how a taxpayer treated the same debt for income tax and VAT purposes. Taxpayers should, therefore, exercise caution when they attempt to claim the allowable input tax and ensure that the facts support a case for a debt that has been written off. The input tax that can be claimed is equal to the tax fraction (15/115) applied to the amount actually written off.

Importantly though, if a vendor has success in recovering a portion of the debt previously written off, this must again be accounted for as output tax. Taxpayers that form part of a group of companies should also note that if the debt has been written off between wholly-owned members, the additional input tax is not allowed.

[1] 58 of 1962 (the Income Tax Act)

[2] 89 of 1991 (the VAT Act)

This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice.  Errors and omissions excepted (E&OE)

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BELASTINGSKULD EN AFBETALINGSOOREENKOMSTE

Om by iemand in die rooi te wees is vir meeste ’n onaangename ervaring, veral as die skuldeiser die Suid-Afrikaanse Inkomstediens (die SAID) is.

Omstandighede lei egter soms na gevalle waar ’n belastingpligtige agter raak met bedrae wat aan die SAID verskuldig is. Ons ondervind egter dat die SAID se skuldinvorderaars (intern en nuut-aangestelde eksterne agente) al hoe meer aktief uitstaande skuld invorder – grootliks weens die tekorte soos wyd gepubliseer wat tesourie ervaar.

Belastingwetgewing maak voorsiening vir belastingpligtiges om alternatiewe reëlings met die SAID te tref om belastingbetalings uit te stel, af te betaal en selfs in sekere gevalle af te skryf.

Dit is egter belangrik om die SAID vroegtydig en pro-aktief te nader om sulke reëlings te tref.

Meestal is die SAID geneë om afbetalingsterme aan te gaan met belastingpligtiges. Dit stel die belastingbetaler in staat om hul skuld in paaiemente af te betaal. Alle tipe belastingbetalings kan daarvoor aansoek doen, maar dit is ’n vereiste om te kan toon dat die belastingpligtige werklik in ’n posisie is om nie dadelik hul belastings te kan betaal nie.

Die SAID vereis gedetailleerde inligting ten opsigte van die belastingpligtige se finansiële posisie alvorens enige afbetalingsooreenkoms toegestaan sal word al dan nie. Oorweging word geskenk aan die betalingsgeskiedenis van die belastingpligtige, vorige oortredings van die belastingwet asook geldige redes waarom die belastingpligtige nie hul skuld ten volle kan betaal nie.

Belastingpligtiges moet egter in gedagte hou dat die SAID nie deur die ooreenkoms gebind sal wees indien die belastingpligtige nie aan die voorwaardes en terugbetalingsterme van die ooreenkoms gehoorsaam is nie.

In die geval waar die uitstaande aanspreeklikheid minder as R 50 000 is sal die SAID gewoonlik ’n 3-6 maande afbetalingsooreenkoms sonder te veel moeite toestaan. Die aansoek moet redes insluit waarom die skuld nie onmiddellik terugbetaal kan word nie.

In gevalle waar die skuld R 50 000 oorskry moet ’n aantal dokumente en inligting die aansoek vergesel.  Dit sluit in, maar is nie beperk nie, tot:

  • Laaste 6 maande se bankstate;
  • Finansiële state vir die mees onlangse finansiële jaar;
  • Nuutste beskikbare bestuurstate;
  • Kontantvloei-vooruitskatting vir die volgende 12 maande;
  • Motiveringsbrief vir die afbetalingsooreenkoms; en
  • Toepaslike aansoekvorms.

Ons nooi u uit om met ons belastingafdeling in verbinding te tree sou u enige verdere navrae met betrekking tot die afbetaling van u skuld hê.

Hierdie artikel is ʼn algemene inligtingsblad en moet nie as professionele advies beskou word nie. Geen verantwoordelikheid word aanvaar vir enige foute, verlies of skade wat ondervind word as gevolg  van die gebruik van enige inligting vervat in hierdie artikel nie. Kontak altyd ʼn finansiële raadgewer vir spesifieke en gedetailleerde advies. (E&OE)

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EMPLOYEES’ TAX (PART I): PERSONAL SERVICE PROVIDERS

For there to be an obligation for PAYE to be withheld is typically dependent on three elements being present. These elements are all defined in the Fourth Schedule to the Income Tax Act[1] and include the presence of an employer, an employee and the payment of remuneration. No employees’ tax can be charged if one of these elements is absent.

As a result of certain avoidance structures being implemented to avoid employees’ tax, specific tax provisions were introduced dealing with “personal service providers” (or “PSPs”) to combat such possible instances of tax avoidance and to limit the available deductions from income in the determination of taxable income for these entities.[2] What individual taxpayers would do to limit their effective tax rate (and to ensure that PAYE is not withheld from remuneration paid to them) otherwise would be to earn their salaries in entities controlled by them. In other words, an employee would arrange with his/her employer that a company owned by the employee would rather be rendering the same services as an employee to the employer. This company would then earn remuneration, even though it would be performing exactly the same services as the employee otherwise would have and had that individual not rendered those services through that company.

It was therefore necessary to include a PSP in the definition of “employee” for tax purposes. A PSP can be a company, close corporation or trust, where any service rendered on behalf of the entity to its client (the would-be employer) is rendered personally by any person who stands in a connected person relationship to such entity. One of three additional requirements must be met for an entity to be a PSP:

  • The client would have regarded the person as an employee if the service was not rendered through the entity.
  • Alternatively, the person must render the service mainly at the premise of the client and he/she is subject to control and supervision of that client as to the manner in which the duties are performed.
  • More than 80% of the income derived from services rendered by the company is received from one client.[3]

A PSP is deemed to be an “employee”[4] and any remuneration[5] received by the PSP is subject to the withholding of employees’ tax in the form of PAYE too. Income tax deductions for PSPs are themselves also severely limited, typically akin to what would have been the case for individual employees themselves. It is recommended that clients of potential PSPs should have policies and systems in place to correctly identify and withhold tax from these entities.

[1] No. 58 of 1962.

[2] Also see SARS Interpretation Note 35 (Issue 4) dated 28 March 2018.

[3] Also includes any associated person in relation to the client.

[4] See the definition of “employee” in paragraph 1 of the Fourth Schedule to the Income Tax Act.

[5] See the definition in paragraph 1 of the Fourth Schedule to the Income Tax Act.

[1] L Taxpayer vs The Commissioner for the South African Revenue Service (Case A124/2017, on appeal from the Tax Court).

This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice.  Errors and omissions excepted (E&OE)

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