Section 7C of The Income Tax Act Explained
What is section 7C? This section of the Income Tax Act is an anti-avoidance measure aimed at transactions between connected persons and trusts, where a trust is funded by low interest or interest-free loans. This is usually done to ensure that assets form part of the trust’s capital, and the funder (who is usually a […]
Do you fall within the “Connected Persons” definition?
On 28 January 2020, SARS released interpretation note 67 providing guidance on the term “connected persons” in section 1(1) of the Income Tax Act. The interpretation note itself is voluminous but worthy of a short discussion as one may fall within this definition without knowing. The definition allows for the following scenarios to be regarded […]
Identifying the difference between donations and payments
BPR 338 deals with the tax treatment of payments made to a Public Benefit Organisation (PBO) at a fundraising event, under section 30 of the Income Tax Act. The ruling is essentially an interpretation of section 18A of the Act and seeks to clarify the situation for PBOs and funders. In terms of the transaction, […]