During February 2016 the beleaguered South African Minister of Finance, Minister Pravin Gordhan, made a serious attempt to balance government’s books.
Gordhan was called back after Minister Nene was removed from his position, by President Zuma early December 2015. The true reason for this politically motivated musical chairs, appointing three ministers in less than 4 days, remains a mystery. Point is Nene was removed and Gordhan had to step in and rescue the cash flow and ensure the country did not face junk status.
There are extensive rights that are available to taxpayers at the commencement of an audit in South Africa.
They are contained in the Tax Administration Act (TAA), the Constitution and the Promotion of Administrative Justice Act. These issues are dealt with in the series of presentations that revolve around tax controversies in Africa and South Africa by Dr Daniel N. Erasmus, a tax controversy specialist in Africa, who resides and consults from the USA. What follows is a recent article published in South Africa about the aggressive moves by SARS:
ARTICLE – THE South African Revenue Service (SARS) is adopting more aggressive tactics to extract information from taxpayers as it tries to achieve a revenue target during a Read More
The South African Revenue Service (SARS) has announced an amnesty of sort – a threat and upfront warnings: we do know about you, best you come forward before we make the tax audit into your affairs known.
On July 9th, 2015, SARS issued a press release, which can be read in more detail on:
http://www.sars.gov.za/Media/MediaReleases/Pages/9-July-2015 – – – South-Africans-with-accounts-and-investments-in-foreign-tax-jurisdictions.aspx
The International Consortium of Investigative Journalists (ICIJ), based information obtained by French newspaper Le Monde, ranked South Africa number 31 among the countries with the largest amount of dollars ($2.3blion) in the so-called leaked Swiss Read More
Posted in sections, this is my Doctoral Thesis on taxpayers rights when audited by the tax authorities in South Africa – equally applicable to many English-based law systems in Africa and abroad (eg. India). This will be of particular use to any tax practitioners doing work in Africa and in other English-based legal systems around the world.
Analysis of Challenging The Commissioner’s Discretionary Powers In Auditing Taxpayers under The Constitution of The Republic of South Africa
CHAPTER 6 – THE IMMEDIATE FUTURE
6.4 REQUEST FOR RELEVANT MATERIAL, AUDIT SELECTION AND FIELD AUDIT Read More
In South Africa, the South African Revenue Service (SARS the local equivalent of the IRS) has just issued a draft public notice for comment and it refers to strange new terminology, not always correctly understood by the non-American resident.
Most US expats and failed SA expats returning from the USA with a green card in the back pocket, are all facing being caught red handed. Yes, for many years SARS was not the best of gossip queen in the OECD. The cam the Krok case and SARS received some interesting info from the ATO. Not only did SARS wake up to the word FOUNDATION they also saw the benefit of acting in “cohort” with another tax authority.
Suddenly the effort to make FATCA happen for FFI’s in South Africa, became an interesting Read More
Exchange Control is the bugbear of every South African residing outside SA or even for those in SA wishing to internationalize their business or investment portfolio.
South Africans have seen a gradual ease of exchange control rules and although most transactions remain under “surveillance” the ease of transfer and tracking have been made substantially easier of the last few years.
Tucked away with Finance Minister Pravin Gordhan’s budget address was a small note in section W3 suggesting he will make it easier for SA pensioners living abroad.
Pensioners living abroad can now extract their monthly pension and retirement annuity income from South Africa (SA) without the need of a tax clearance certificate, despite living Read More
The first and very important note to make, in dealing with South African tax issues: tax year 2014 ends on the last day of FEBRUARY 2014. The South African tax year for most individuals, are 1 March until the last day of February in the next calendar year. Corporates can change their tax year-end to align with the last day of their financial year-end, yet Trusts partners in a JV or partnership, are obliged to file assuming a tax year-end on the last day of February, despite their financial year-end being the last day of another month.
Yes, sadly this date, Friday 28th 2014, is not even listed on the SARS webpage on important dates, yet is an extremely important tax deadline.
SARS has two webpages namely: www.sars.gov.za and www.sarsefiling.co.za. Read More
On October 3rd, 2013 the South African Revenue Services (www.sars.gov.za) issued BPR 156 (binding private ruling) which ensure some clarity on the taxation of many expats’ pension funds stuck in South Africa.
An interesting ruling, which may be technically correct but in many ways inadequate, writer felt on first read. Perhaps incorrectly? Let’s consider the outcome and value of the ruling.
Like most SARS rulings, it brings clarity but adds several “however” warnings. Before we address them, allow me to summarize the ruling, with an extract:
SECTION: SECTION 1(1), DEFINITION OF “GROSS INCOME” PARAGRAPHS (a) AND (e)
SUBJECT: PENSION BENEFITS ACCRUING TO A NON-RESIDENT FROM A RESIDENT PENSION FUND
This ruling deals with the question as to whether and to what extent a pension annuity and a retirement fund lump sum benefit, received by or accrued to a person who is not a resident of South Africa from a pension fund registered in South Africa, will be taxable in South Africa. Read More
The South African Revenue Service (SARS), established in 1997 is an organ of state within the public administration, but as an institution outside the public service of the Republic of South Africa.
The President of South Africa appoints the Commissioner for SARS, yet when the Commissioner is absent or during a period of vacancy, the acting Commissioners is appointed by the Minister of Finance.
Current Minister of Finance, Pravin Gordhan was the immediate past Commissioner for SARS.
During his most successful if not glamorous tenure as C:SARS the said government agency transformed from a post-apartheid elephant into the most effective eFile / Cloud efficient government agencies. Whilst other Commissioners and Director Generals (the equivalent title within a government department) running government departments dismally failed and despite two Commissioner of Police, being left tainted, Gordhan left behind a legacy and a government agency to be proud of. The Star of Africa was how some referred to SARS.
Then suddenly, three years after SARS Commissioner Oupa Magashula appointment in 2009, rumours surfaced in 2012 linking said Magashula to promises and people, not associated with the best of breed governance practises. Read More
Tax year-end in South Africa, for smaller companies and all individuals, is on the last day of February 2013.
In terms of the collection process, South African Revenue Services (SARS or the equivalent of IRS and HMRC, the competent taxing authority in SA) expects all provisional taxpayers to be either 80% or 90% correct in the end February provisional tax estimate, compared to the final assessment or IT34.
Irrelevant I hear the expats shout, as non-resident taxpayers face withholding taxes and are not required to pay provisional tax. True, I agree but non-resident for purpose of the provisional tax exemption, refers to a person that is either actually tax non-resident or was never tax resident and to a person exclusively tax resident of another country in terms of an applicable double tax treaty.
SA expats residing in the USA relying on anything less than a green card is probably exclusively tax resident in South Africa, as the SA Expats in Australia are exclusively SA tax resident (normally) until they receive a Permanent Residence (PR) Permit. The USA PR obviously is the green card and most others are not adequate to change the tax treaty tie breaker outcome. Read More