Tax Breaks Newsletter - Volume 2009, Issue 279, 2009
Volume 2009, Issue 279, 2009
Source: Tax Breaks Newsletter 2009, pp 1 –2 (2009)More Less
Most readers of Moneyweb's Tax Breaks will be aware of the general principles contained in Section 11(a) of the Income Tax Act concerning the deductibility of an expense for income tax purposes. One of the stipulations of this Section is that expenses of a capital nature are specifically excluded.
However, the legislators have long recognised that the amount by which a capital asset loses value each year as a result of normal use represents a cost to the taxpayer, and for this purpose Section 11(e) provides that a wear and tear allowance can be claimed for this purpose.
Author Jenny BoothSource: Tax Breaks Newsletter 2009, pp 3 –4 (2009)More Less
Template wills and inexperienced drafters may result in trustees having to pay 20% capital gains tax on loan accounts due by trusts to deceased estates. A recent judgement in the Special Income Tax Court held that the drafting of a will with a clause bequeathing the residue of an estate to a particular trust amounted to the forgiveness of a debt, and thus gave rise to a capital gains event. As a result the trustees have to pay 20% CGT on the amount of the loan bequeathed to them.
Author Monique VanekSource: Tax Breaks Newsletter 2009 (2009)More Less
Once the South African Revenue Service's (SARS') proposed amendment comes into effect, it will pay interest on any tax you've overpaid. Previously SARS was allowed to invoke the relevant provisions in the VAT and Income Tax Acts to get you to "pay now and argue later", and even when you won your dispute, you would not receive any interest on your money. This caused much consternation among taxpayers, and readers have raised questions concerning the prevailing practice.
Author Carla MonteiroSource: Tax Breaks Newsletter 2009, pp 4 –5 (2009)More Less
In 2002 the Gauteng Income Tax Special Court was presented with the following facts : The taxpayer responded to an invitation to tender from the then Minister of Transport and Telecommunications for a licence to conduct a non-exclusive cellular telephone service for a renewable period of 15 years. The taxpayer won the tender and, in addition to an "initial basic cellular licence fee" of R100 million, was required to pay an ongoing annual licence fee of 5% of its net revenue.
Author Edward Nathan SonnenbergsSource: Tax Breaks Newsletter 2009, pp 5 –6 (2009)More Less
Did you receive a retention bonus to which you are no longer entitled as you are considering leaving your company, and are worried about the tax originally paid on that bonus? Worry no longer, for a recent amendment to the Income Tax Act No 58 of 1962 has removed the tax burden thereon.
Author B.D.O. Spencer StewardSource: Tax Breaks Newsletter 2009, pp 6 –7 (2009)More Less
On 1 March 2009, the presumptive turnover-based tax for micro businesses was eventually introduced.
The grounds for the new tax are very much founded on pragmatism rather than being any form of incentive. According to a survey conducted by SARS, a small business would typically spend in excess of R7 000 per annum on basic tax compliance, whereas related services such as accounting services, which are necessary to meet one's tax compliance burden exceed, on average, R36 000 per annum. It is, in fact, acknowledged by the policymakers that many taxpayers are overwhelmed by the tax system.
Source: Tax Breaks Newsletter 2009, pp 7 –8 (2009)More Less
One of the more confusing issues when it comes to VAT is when a vendor deals with goods that are not theirs. No, this is not an article on the VAT treatment of stolen goods! Rather, it deals with those circumstances where you are legitimately in possession of goods that are not yours, or when you are handling goods on behalf of another.
Source: Tax Breaks Newsletter 2009 (2009)More Less