An investor in listed shares who makes a profit on the sale of those shares is liable for one of two taxes on this profit : either capital gains tax or income tax. Naturally, investors would prefer to be taxed under the more favourable CGT legislation than on income account.
Many clients will enquire from their tax adviser whether legal professional privilege will protect the information disclosed for which they are about to obtain tax advice. Is the Commissioner : South African Revenue Service (SARS) entitled to call for information from taxpayers or their advisers, which legal professional privilege would otherwise protect?
A note of caution is expressed in Finance Minister Trevor Manuel's statement that the present buoyancy in our economic growth is partly a consequence of favourable global economic conditions and we need to distinguish temporary prosperity from structural progress.
How does the SA Revenue Service catch those who don't contribute their fair share to state coffers? Here are some tests that SARS auditors perform to see if you are being somewhat economical with the truth.