Forming a Trust in South Africa: Which Type Suits You?
What is a trust? The answer may seem obvious, but in practice, many people get confused as to exactly what a trust is and what such a structure is meant for. In this article, we examine the various types of trust recognised under the South African common law, as well as where the Income Tax […]
Death Is Unavoidable, But Estate Taxes Can Be Planned For
Estate duty is one of those taxes that many people know about in theory, but very few actively plan for. It only becomes real when a loved one passes away and the estate is wound up, often revealing how much value quietly leaks away to taxes, fees, and avoidable inefficiencies. The reality, however, is that […]
Home office expenditure
Taxpayers who are salaried employees have limited deductions available to them. However, home office expenditure can be claimed as an income tax deduction, but the onus is on the taxpayer to prove that the expenses are in fact deductible. For employment to constitute a “trade” and to qualify to deduct home office expenditure, the taxpayer […]
Correction of an assessment: Section 93
As portrayed in the Tax Administration Act No 28 of 2011 (TAA), the dispute resolution rules lay out the legal framework to be followed by both the taxpayer and the South African Revenue Service (SARS) to resolve disputes. Section 93 of the TAA lists a number of circumstances under which SARS can reduce a taxpayer’s […]
Make sure your antenuptial contract is valid before getting married
John and Susan are getting married on the 5th of October 1993. They have chosen to get married by way of an Antenuptial Contract. John and Susan signed the contract on the 3rd of October 1993 in front of their attorney who had a Power of Attorney on their behalf to sign in front of a Notary, as […]
Can losses be distributed out of a trust?
On 18 March 2021, the Supreme Court of Appeal delivered judgment in the case of Massmart Holdings Limited v The Commissioner for the South African Revenue Service. The case dealt with losses which were incurred within the broader Massmart group in respect of the investing of equity instruments as part of an employee share incentive scheme. The mechanism of […]
The unfortunate timing of BGR55 for developers
In terms of the Tax Administration Act, the South African Revenue Service (“SARS”) can issue Binding General Rulings (“BGR”) on matters of general interest or importance and clarifies the Commissioner’s application or interpretation of the tax law relating to these matters. BGR55 (issued on 10 September 2020) clarifies the VAT consequences of the sale of fixed property consisting of […]
Beware of scams during filing season
In late August 2020, a large credit bureau in South Africa was the target of a data breach where millions of private individual and company data records were compromised. This data leakage, coupled with the tax filing season, makes for the perfect opportunity for taxpayers’ information to be abused, subjecting taxpayers to potential financial loss. Scammers thrive on the inherent vulnerability of taxpayers during the tax season and know how to capitalise on the taxpayers’ struggles in dealing with […]
The finer details of judgment rescission
The judgment deals with an application for rescission of a judgment by Barnard Labuschagne (Applicant), where SARS took judgment under the provisions of chapter 11 of the Tax Administration Act (TAA). SARS filed a certified statement in terms of Section 172 of the TAA with the Registrar of the Court, setting out an amount of […]