The 2018 National Budget revealed a proposed increase in the “official rate of interest” as set out in the Income Tax Act. Increasing the official interest rate increases the individual tax burden, including discouraging low interest loans from employers and creating significant extra tax on loans to trusts.
Tel: 021 406 9100
Location: Cape Town
Expertise: Corporate And Commercial, Non-resident Services
Johan joined STBB in 2013 and works in the Cape Town office where he specialises in tax structuring and commercial drafting.
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What is a Public Officer? The Tax Administration Act 28 of 2011 stipulates that all companies are required to appoint a Public Officer. A Public Officer serves as the representative taxpayer for a company, meaning that this person is, effectively, the face of the company for tax purposes. All actions carried out in this person’s capacity as […]
The VAT increase coming into effect on 1 April 2018 triggered some tricky questions. One of these is the question what the VAT rate will be in the case of estate agent’s commission payable in respect of a mandate granted to the agent before 1 April 2018, where a sale is completed (all suspensive conditions […]
On 21 February 2018 the Minister of Finance, during the 2018 annual budget, announced that the VAT rate will increase by 1 percentage point to 15% effective from 1 April 2018. General VAT is essentially an inclusive tax, meaning that the price charged by a vendor includes VAT. This also means is that any quote, […]
A new insert in the recently amended Income Tax Act sees interest-free and low-interest loans to trusts now made subject to donations tax of 20%. And not only does it apply to loans made from 1 March 2017, but also targets existing agreements. The good news is that there is possibly some relief.
When will s7C apply? Clients who have made, as well as those who are considering making, interest-free or low-interest loans to trusts must take note of a recent inclusion to the Income Tax Act (“the Act”). This inclusion comes in the form of Section 7C, which was inserted in the latest Taxation Laws Amendment Act […]
During the 2016 budget speech Minister Gordhan alluded to the amendment of the taxing provisions pertaining to loans made to trusts to curb the avoidance of estate duty and donations tax. The draft legislation will apply to “direct and indirect loans made to trusts by natural persons who are connected persons or by a company […]
Did you know that transfer duty on the sale of a share in a ‘residential property company’, as defined in the Transfer Duty Act, is determined in accordance with the value of the share(s) acquired? For example, purchasing a 50% share for R500,000 in a residential property company where the fair market value of the […]
A recent amendment to the National Credit Act (“NCA”), effective from 13 March 2015, provides that no person may, in terms of an agreement to which the NCA applies: • sell a debt; and/or • collect or re-activate a debt; which has prescribed in terms of the Prescription Act. The result of the amendment is […]
On 1 January 2015 a withholding tax of 15% was introduced in respect of interest payable to, or for the benefit of, any foreign person if it is received or accrued from a South African source. The withholding tax is required to be retained by the relevant South African resident entity and paid directly to […]