Tax deductions for disability: Retroactive change relating to school fees
Expenditure prescribed by SARS and which is necessarily incurred and paid for by a taxpayer due to a physical impairment or disability is a qualifying medical expense for tax purposes. Taxers incurring such expenses can obtain a tax benefit. An expense does not automatically qualify as a deduction by mere reason of its listing in […]
Is your disclosure “Voluntary”?
In December 2021, the Supreme Court of Appeal (SCA) handed down a judgment dismissing an appeal against a decision of the Tax Court. The issue before the SCA was whether the South African Revenue Services (SARS) was correct in rejecting Purveyors South Africa Mine Services (Pty) Ltd’s (Purveyors) Voluntary Disclosure Programme application (VDP application) for […]
Everything you need to know about Suretyship agreements
A deed of suretyship is an agreement that is concluded by a creditor and a third party. The essentialia of this type of agreement are that the surety (third party) undertakes to be liable to the creditor for the due performance by the debtor of his or her obligations in terms of the principal debt. […]
Deceased’s will declared invalid, despite clear wishes
The Wills Act sets out the requirements for a valid Last Will and Testament. For a will to be valid, it must be signed and witnessed. What happens if the wishes of the deceased are clear, but the document does not meet the requirements of a valid will? This was the heart of the matter […]
Persons with disabilities may benefit from a special trust
Unlike “conventional trusts” that are taxed at a flat tax rate, a special trust is taxed on the same sliding scale applicable to natural persons. The Income Tax Act provides for two types of special trusts: a so-called type-A and type-B trust. In essence, a type-A trust is created for a person (or persons) having […]
Learning from Spur Group in the structure of employee share schemes
In October 2021, the Supreme Court of Appeal (SCA) handed down judgment upholding the Commissioner for the South African Revenue Service’s appeal against an earlier decision in the Western Cape High Court in favour of Spur Group in relation to employee share schemes. The issue for determination by the SCA was whether the high court […]
Proposed legislative changes: Fringe benefits in relation to employer contributions to retirement funds
With effect from 1 March 2016, and in terms of paragraph 2(l) of the Seventh Schedule to the Income Tax Act, all employer contributions to a retirement fund on behalf of employees are considered taxable fringe benefits in the employees’ hands. In turn, paragraph 12D(2) of the Seventh Schedule stipulates that if the employer contributes towards a fund […]
Can SARS correct my assessment?
A taxpayer who is aggrieved by an assessment or decision of SARS against that taxpayer has the right to dispute that assessment or decision. If an original assessment has not been issued, SARS may request a taxpayer to submit an amended return to correct an undisputed error made in the prior return. In the case […]
Transfer of assets between spouses: what are the tax implications?
Section 9HB of the Income Tax Act provides for a roll-over of a capital gain or loss when an asset is transferred between spouses during their lifetimes. The roll-over is mandatory, and spouses do not have the option to elect out of it. The policy rationale for the roll-over is that the transferor spouse must benefit […]
Business continuity planning: Are you prepared for the next crisis?
While the possibility of a global pandemic was always at the back of our minds, its emergence still managed to catch us off-guard and wreaked havoc on every aspect of our lives, particularly the world of work. Therefore, it’s safe to say that Covid-19 has been a wake-up call for organisations to rethink their priorities […]