07 January – PAYE submissions and payments 19 January – End of Filing Season 2025 for Provisional Taxpayers and End of Filing Season 2025 for Trusts 23 January – VAT manual submissions and payments               29 January – Excise duty payments 30 January – VAT electronic submissions and payments & CIT Provisional Tax payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © AccountingDotNews

“The South African Revenue Service is always ready to assist taxpayers to fulfil their legal obligations.” (SARS) Acknowledging that taxpayers often find it difficult to settle tax debt due to financial challenges, SARS has launched an expedited debt compromise process to help eligible taxpayers settle outstanding tax debts swiftly and on more favourable terms. The normal debt compromise process remains available to all taxpayers, and learnings from this expedited process will be used to enhance the broader system. What is a debt compromise? A compromise is a written agreement between SARS and a taxpayer in which SARS agrees to accept a reduced amount as full and final settlement of a tax debt. Once the taxpayer pays the agreed amount and complies with the terms, SARS waives the balance of the debt. However, if the taxpayer defaults or fails to remain compliant, SARS can reinstate the full debt. Expedited debt compromise eligibility criteria The process applies to non-disputed tax debts older than 12 months. You must be a client of a registered tax practitioner. Your tax returns must be up to date (even if payment is outstanding). The following exclusions apply: entities subject to specific legal processes (such as liquidations, estates, and business rescue cases), companies that are deregistered, cases subject to criminal investigation and audit, as well as cases within the write-off process, taxpayers who have had a compromise in the past three years, and taxpayers who have the means to pay but refuse to do so. Submission requirements Taxpayers applying for the expedited tax debt compromise process must provide comprehensive relevant supporting documentation with their applications, which must be submitted by 31 December 2025. These documents include: Latest Annual Financial Statements (not older than one year) Last six months' bank statements Cashflow forecast for 12 months List of Assets and Liabilities at market value Debtors’ age analysis Details of any connected persons Details of assets disposed of in the last three years Disclosure of future or contingent interests in assets Details of assets under the taxpayer's control (including through trusts) Current and projected income for the next three years Application letter with clear motivation, including the proposed settlement offer amount, and the source of funds to pay the offered amount Collection Information Statement (CIS) request with reasons and proof to compromise the debt. It is important that disclosures are accurate – if they aren’t SARS might not even consider the application. SARS has committed to resolving qualifying applications within four weeks, using dedicated teams and enhanced workflow management. Approved compromise settlements may be paid either in full (once-off payment), or in instalments as agreed by SARS. Act now to avoid escalation From 1 January 2026, SARS will escalate enforcement against taxpayers who remain non-compliant and have not applied for compromise. Such enforcement may include civil judgments against the taxpayer, writs of execution, collection of money from third parties such as banks, attachment of taxpayer assets, holding directors or members personally liable for the debt, sequestration or liquidation of the…

05 December – PAYE submissions and payments 24 December – VAT manual submissions and payments 30 December – Excise duty payments 31 December – VAT electronic submissions and payments & CIT Provisional Tax payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © AccountingDotNews

“Trustees remain accountable for all tax matters of a trust, regardless of the economic activity of the trust.” (SARS) The official trust filing season for the 2025 year of assessment is now open for both provisional and non-provisional taxpayers – and SARS has issued stern warnings to trustees to fulfil their tax obligations.  Who must file trust tax returns?   A trust is included under the definition of a “person” in terms of the ITA (Income Tax Act no.58 of 1962) and is therefore regarded as a taxpayer.  All South African trusts, including resident and non-resident trusts, that are registered for income tax, must file a tax return annually, even if the trust is not economically active.  A trustee is the representative taxpayer of a trust. Trustees or representatives must register the trust for income tax and file the required tax returns annually. Alternatively, a registered tax practitioner can be appointed as the representative taxpayer. What must be done?  Taking into account recent changes to the legislation, trustees must submit their returns for the 2025 year of assessment and file the mandatory supporting documents listed further below.  Recent legislative changes The “flow-through” principle is now limited to resident beneficiaries, so all amounts vested to non-resident beneficiaries are taxable in the hands of the trust. This also affects the submission requirements for provisional tax (IRP6). Foreign tax credits for taxes paid on income or capital gains earned in a foreign jurisdiction can now be used to prevent double taxation. From the 2025 tax year onwards, unused foreign tax credits will be carried forward automatically to the subsequent years of assessment, up to a maximum of six years. The Section 12H Learnership Agreement is extended to 31 March 2027. The definition of a trust is updated to include collective investment scheme portfolios. SARS has issued new rules on how losses relating to distributions are limited under section 25B. Return submissions The final deadline for the submission of provisional and non-provisional Trust Income Tax Returns (ITR12Ts) is 19 January 2026. Mandatory supporting documents Required DocumentsDetailsTrust instrumentLatest deed or willCertain transactions and financial flowsIncome sources and distribution of income; proof of any tax creditsFinancial informationFinancial Statements/Annual Administration AccountParties connected to a trustBeneficial-ownership document, including detail per entity listedOther documentsLetters of Authority and Minutes and Resolutions of trustee meetingsForeign trust document (if applicable)Controlled Foreign Company (IT10)Mining document (if applicable)Mining Schedule A and B Source: SARS File on time! Trustees and administrators should take note that all the return submissions and supporting documents are due by 19 January 2026 – just days into the new year. Submitting within the deadlines is necessary to comply with SARS regulations. Late submissions can lead to administrative penalties, interest charges, and additional steps. What else must be done? Because a trust is also a provisional taxpayer, trustees should be aware that a trust is further required to submit provisional tax returns (IRP6) twice a year in August and February. In addition, trustees are also required to submit an IT3(t) third-party data return that provides details of amounts vested…

07 November – PAYE submissions and payments 25 November – VAT manual submissions and payments 27 November – Excise duty payments 28 November – VAT electronic submissions and payments, & CIT Provisional Tax payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © AccountingDotNews

“Profile hijacking points to pervasive cybercrime with global links.” (Edward Kieswetter, SARS Commissioner) The Tax Ombud has again warned South Africans about the concerning increase in eFiling profile hijackings, which has spurred the Office of the Tax Ombud (OTO) to launch a survey of taxpayers' experiences and a systemic investigation into SARS. What is eFiling profile hijacking?   eFiling profile hijacking involves cybercriminals gaining unauthorised access to taxpayers' SARS eFiling accounts. Once inside, they change the security details and banking information, and submit fraudulent tax returns to redirect the refunds into their own accounts.    Methods such as SIM swaps and phishing are commonly employed to get access to taxpayers’ eFiling profiles. Using calls and fraudulent SARS text messages, emails and letters of demand, scammers pose as SARS officials or tax advisors, often pretending to want to assist taxpayers to get their SARS refunds.  Concerns have also been raised about possible internal fraud and insider involvement at SARS and certain banks. SARS systemic investigation  While SARS acknowledges the rise in eFiling profile hijackings, it emphasises that although individual profiles have been compromised, the SARS system itself has not been breached.  SARS adds that additional security measures have been implemented and that it is collaborating with financial institutions and the OTO to combat the scourge of profile hijacking.  How to safeguard your eFiling profile  SARS has issued the following advice: Avoid sharing your eFiling login details. SARS will never request OTPs, passwords or bank details via calls, emails or text messages. Use strong and unique passwords and update them regularly. Enable two-factor authentication for an additional layer of security. Regularly check your eFiling profile and submitted returns for any unauthorised changes. Verify your bank account on eFiling before a refund is paid, even if there hasn’t been a change to the banking details. If you suspect your profile has been hijacked, change your login credentials promptly using another device, and report it immediately to SARS and to the SAPS as an identity theft case. Rely on the expertise of a SARS registered tax practitioner such as ourselves.  How we help keep your eFiling profile safe  As your accounting and tax partner, we help you to keep your eFiling profile safe by, for example, keeping abreast of all the latest scams, validating the status of your tax affairs and any SARS enquiries or requests, and by using only official channels for interacting with SARS, especially when making payments.  If you are concerned about the security of your SARS eFiling profile, or if you have been contacted by anyone offering assistance with obtaining a SARS refund, contact us immediately.  We are the ally you need in the fight against profile hijacking. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © AccountingDotNews

07 October – Monthly Pay-As-You-Earn (PAYE) submissions and payments 20 October – End of Filing Season 2025 for Individual taxpayers 24 October – Value-Added Tax (VAT) manual submissions and payments 30 October – Excise Duty payments 31 October – VAT electronic submissions and payments and CIT Provisional Tax payments. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © AccountingDotNews

“He said that there was death and taxes, and taxes were worse, because at least death didn’t happen to you every year.” (Terry Pratchett) In SARS jargon, a ‘systemic issue’ is the underlying cause of a complaint that affects many taxpayers. These systemic issues may have to do with the way SARS systems function, how SARS drafts and implements policies or procedures, or even how it applies or disregards legislative provisions. Over the years, collaboration between the Office of the Tax Ombud (OTO) and SARS has reduced the number of systemic issues from more than 20 to seven. 7 systemic issues at SARS Delays in payment of refunds. Non-adherence to dispute resolution timeframes and rules under the Tax Administration Act (TAA). Undue hardship caused to taxpayers resulting from the way the Tax Compliance System (TCS) is designed. Failure to respond to requests for deferred payment arrangements within the prescribed turnaround time (21 days). Failure to respond to requests for a compromise within the prescribed turnaround time (90 days). Failure to respond to requests for a suspension of payment within the prescribed turnaround time (30 business days). Repeat verification for reduced assessments or for cases with the same risk and supporting documentation. How do systemic issues affect my business? Delayed refunds – especially VAT and diesel refunds – create massive cash flow challenges for companies, inhibiting growth and increasing the risk of business failure, especially for small businesses. Similarly, the design of SARS’ Tax Compliance System has resulted in companies losing contracts or tenders, or not being paid by corporate or government clients. This is because the system may flag a company as non-compliant where payment arrangements or suspension of debt agreements are in place. The system also reflects non-compliance for immaterial transgressions – including, for example, minimal debt amounts such as R1 and outstanding returns or payments for which arrangements have been made with SARS; or even fraud committed by SARS or ex-SARS officials. SARS’ non-adherence to dispute resolution timeframes and rules, and its delayed response to requests for payment arrangements, not only infringe on taxpayer’s rights, but also expose taxpayers to prolonged periods of ‘non-compliance’, despite their efforts to become compliant. Repeat verification cases cost time and money, adding a further unnecessary compliance burden on taxpayers. How we protect your interests While these systemic issues are being addressed by SARS, and monitored by the Tax Ombud, SARS suggests that taxpayers rely on the expertise of a registered tax practitioner. As your SARS-registered tax practitioner, we protect your interests and rights as a taxpayer in the following ways: Careful compliance and excellent record-keeping are always the first line of defence when dealing with SARS – we help ensure that you have the correct processes in place to ensure both. Our team of tax experts can professionally and correctly represent your business in the event of a tax dispute with SARS. We understand the service levels and time frames outlined in the TAA and SARS’ Service Charter and we are experienced…

05 September – PAYE submissions and payments 25 September – VAT manual submissions and payments 29 September – Excise duty payments 30 September – VAT electronic submissions and payments, CIT Provisional Tax payments and PIT top-up Provisional Tax payment where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © AccountingDotNews

“Transactions or speculation in crypto assets are subject to the general principles of South African tax law and taxed accordingly.” (SARS) A staggering 5.8 million South Africans hold a crypto asset, with Southern Africa boasting the largest uptake of Bitcoin in the world.  SARS has not failed to notice the phenomenal growth of various digital currencies and crypto assets and is now dedicating substantial resources to ensure that crypto assets and trades are declared on taxpayers’ tax returns. How are crypto assets taxed?  While crypto assets are not considered legal tender, transactions or speculation in crypto assets are subject to the general principles of South African tax law.  Normal income tax rules apply and affected taxpayers need to declare crypto assets’ income, and gains or losses in the tax year in which it is received or accrued. Income from crypto assets transactions can be taxed under “gross income” or it can be seen as a capital gain (and subject to CGT). Whether an accrual or receipt is revenue or capital in nature is tested under existing tax law, of which there is plenty. Taxpayers are also entitled to claim expenses associated with crypto assets accruals or receipts, provided such expenditure is incurred in the production of the taxpayer’s income and for purposes of trade. Base cost adjustments can also be made according to the CGT rules. Gains or losses in relation to crypto assets can broadly be categorised with reference to three types of scenarios, each of which potentially gives rise to distinct tax consequences: Crypto assets can be acquired through so called “mining” – the verification of transactions in a computer-generated public ledger through the solving of complex computer algorithms. Investors can exchange local currency for a crypto asset (or vice versa) through crypto asset exchanges (which are essentially markets for crypto assets) or through private transactions. Goods or services can be exchanged for crypto assets. Such transactions are regarded as barter transactions and the normal barter transaction tax rules apply. The onus is on taxpayers to declare all income and gains related to crypto assets. Stricter enforcement  SARS has intensified its focus on crypto asset trading recently, significantly improving its capacity to detect crypto activity and non-compliance. They have done this by: Making greater use of advanced analytics, artificial intelligence, machine learning and algorithms Entering into data-sharing arrangements with crypto exchanges Establishing a dedicated Crypto Asset Unit Since last year, SARS has been sending Audit and Request for Relevant Material Notices to taxpayers who have traded, invested or even used crypto assets for purchases. This is possible because SARS now has access to trading data directly from crypto exchanges. This includes information on taxpayers who have traded in crypto assets but may not have disclosed these activities on their tax returns. In addition, through multilateral agreements, SARS is exchanging information with other tax authorities globally, in line with global tax enforcement trends. What’s more, the establishment of SARS’ specialised Crypto Asset Unit is a clear indication that crypto…

07 August – PAYE submissions and payments 25 August – VAT manual submissions and payments 28 August – Excise duty payments 29 August – VAT electronic submissions and payments, Corporate Income Tax Provisional payments where applicable, and Personal Income Tax Provisional payments.  Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © AccountingDotNews

“My sincere gratitude goes to the compliant taxpayers and traders who have continuously played their part in building our country. Ndza khenza.” (SARS Commissioner, Edward Kieswetter) Tax Filing Season 2025 officially opens on 7 July this year. This covers the 2024/2025 year of assessment: the period between 1 March 2024 and 28 February 2025. During filing season, taxpayers complete and submit their tax returns, declaring their income and deductions to allow SARS to determine their final tax liability for the period under assessment.  This year, for the first time, the majority of non-provisional taxpayers will be automatically assessed. Dates to diarise Auto assessed? Here’s what to do… If you have been auto assessed, you will receive notification by SMS and/or email directly from SARS after 7 July. (Be sure to check with us that the notification you receive is legitimate!) Access your auto assessed income tax return through any of SARS’ channels, such as the SARS MobiApp or SARS eFiling, to review and verify the completeness and accuracy of the information it contains. (Be sure to check with us if you are uncertain of any aspect of the auto assessment!)  If you are satisfied with the auto assessment, and there is money owing to SARS, it must be paid to SARS by the stipulated date. If there is a refund due to you, it will be paid directly to your bank account within 3 working days, if your details with SARS are correct.  If there is missing and/or inaccurate information on the auto assessed tax return, pertaining to either income or expenses which may affect the outcome of the auto assessment, it must be declared to SARS by submitting a ITR12 tax return by the 20 October 2025 deadline. Not auto assessed? Here’s what to do… Non-provisional taxpayers who are not auto assessed can start filing their tax returns from 21July 2025 until 20 October 2025.  Provisional taxpayers (certain individual taxpayers and all companies) as well as trusts can start filing returns from 21July 2025 until 19 January 2026. Top tips to streamline your tax filing season  Verify all SARS communications received to protect yourself from scams.    Check that all taxpayer and banking details are correct and updated with SARS to facilitate refunds and prevent identity theft and fraud.  Prepare all required documentation early to avoid last-minute delays and to expedite a possible SARS verification or audit.  Claim every tax rebate available to you to avoid paying more tax than required.  Ensure that your tax return submissions comply with current regulations. Be certain to meet the submission deadlines to avoid penalties.   Fortunately, our team of seasoned tax professionals is ready to ensure you tick all these boxes. Let’s make this filing season an easy one!    Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and…

“We accept the responsibility to achieve the 2025/26 revenue estimate presented by the Finance Minister Mr Enoch Godongwana.” (SARS Commissioner Edward Kieswetter) Removing the contentious proposed VAT increases from Budget 3.0 led to a shortfall in revenue that necessitated new revenue sources.  One of these is the inflation-linked fuel levy increases of 16c for petrol and 15c for diesel, which became effective on 4 June and will impact all individuals and entities in the country. Another alternative revenue source is going to come from SARS’ upping its collection of outstanding tax debt – with Treasury expecting an additional R20 billion to R50 billion per year from intensified debt collection efforts. The tax measures contained in Budget 3.0 will raise an additional R18bn in 2025/26. A further R20bn in as-yet-unknown tax measures are postponed to Budget 2026 – unless SARS collects an extra R35bn in outstanding taxes.  SARS has accepted the challenge and Budget 3.0 allocated a further R4 billion to SARS to fund the debt recovery. (In addition to the R3.5bn previously allocated to the cause.) ‘Project AmaBillions’? In what the media refers to as “Project AmaBillions” and what SARS calls its “compliance programme”, an intensified effort will be made to collect a greater slice of the estimated R800 billion in unpaid taxes – the so-called “tax gap”.  SARS reported that just over R400 billion of the tax gap consists of undisputed uncollected debt. The rest is made up of a further R100 billion in debt currently under dispute, more than 54 million returns outstanding dating back several years, and 156,000 South Africans with substantial economic activity who are not registered taxpayers, or are not filing their tax returns. SARS says that it will focus on the undisputed debt, while accelerating work on collecting all debt by dutifully implementing its compliance programme.  In the last financial year SARS recruited and trained more than 800 new employees to collect debt, mainly via telephone calls and legal instruments. These efforts, says SARS, must result in a minimum collection of R20 billion. To meet its revised revenue estimate this year, SARS is: Closing the tax gap, with a focus on undisputed debt.  Broadening the tax base, targeting hard-to-tax sectors in the informal economy, particularly small enterprises and self-employed individuals. Using advanced data analytics and artificial intelligence to detect tax-compliance risks and improve overall compliance rates.  Combating the illicit economy.  How does it affect me?  As SARS significantly steps up its revenue collection efforts, those eligible to pay tax – whether registered taxpayers or not – can expect less lenience and more SARS queries, verifications, audits and collection efforts.  In fact, the South African Institute of Chartered Accountants (SAICA) has been quoted in the media warning that the pressure on SARS to collect significantly more tax this year may result in “heavy-handedness” by SARS in its treatment of taxpayers. SARS confirms that it upholds the rights of taxpayers to exercise their rights in law, which include among others, asking for payments to be deferred or…

07 July – Monthly PAYE submissions and payments 25 July – Value Added Tax (VAT) manual submissions and payments 30 July – Excise duty payments 31 July – VAT electronic submissions and payments, Corporate Income Tax (CIT) Provisional Tax payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © AccountingDotNews

"The difference between tax avoidance and tax evasion is the thickness of a prison wall." (Denis Healey, former UK Chancellor of the Exchequer) The line between tax avoidance and tax evasion can sometimes appear blurry, especially in complex transactions or fierce tax planning strategies. The comparison below is a good starting point: What is tax avoidance? Tax avoidance refers to legal arrangements or transactions designed to reduce or eliminate tax liability, without breaking the law. Examples of tax avoidance include: Moving a company into a special economic zone for the sole reason of achieving a lower corporate income tax rate. Timing the sale of capital assets to control the timing of capital gains and losses. Getting your company to pay for a motor vehicle or other expenditure as it may, depending on the circumstances, be taxed at a lower rate.  Placing a large amount of your income into a retirement fund to obtain the highest deduction possible. Investing in tax-free savings accounts (this applies to individuals only). Often termed “permissible tax planning”, tax avoidance is legal and accepted. However, when tax avoidance becomes overly aggressive or artificial (i.e., lacking commercial substance), it may cross into what tax authorities consider “impermissible” or “abusive” tax avoidance. This, while not necessarily criminal, may be challenged under anti-avoidance rules such as the General Anti-Avoidance Rule (GAAR). South Africa employs GAAR to counteract tax avoidance strategies that exploit loopholes. These rules allow tax authorities to disregard or re-characterise transactions that have the primary purpose of avoiding tax. What is tax evasion? Tax evasion is characterised as the illegal act of deliberately and intentionally avoiding paying taxes, either by avoiding paying tax entirely, or by illegally reducing or deferring taxes payable. It can involve hiding or ignoring one's tax liability by making false representations or statements, or hiding income or information that would otherwise be subject to taxation. Examples of tax evasion include: Failing to file required tax returns  Making false statements on tax returns  Failing to declare income or deliberately underreporting income Claiming personal expenses as business expenses Over-declaring expenses, which may include falsifying invoices Using multiple entities without legitimate business purpose Moving money through multiple accounts to obscure its source SARS uses data-driven insights, self-learning computers, and artificial intelligence to combat tax evasion, and is empowered to conduct criminal investigations into tax offences and work with the criminal justice system to prosecute offenders. Tax evasion can result in severe penalties of up to 200% of the shortfall in tax, plus interest, and even jail sentences of five years or more. Best practices for legal tax avoidance Stay updated with ever-changing tax legislation to make informed decisions. Structure your business operations or transactions in a manner that legally minimises taxes – for example, operating as a sole proprietorship or a private company have different tax implications.    Engage in permissible tax planning by adhering to all tax laws and regulations, and avoiding abusive tax schemes designed to exploit loopholes in the tax laws. Utilise all tax deductions, credits, exemptions…

06 June – PAYE submissions and payments     25 June – VAT manual submissions and payments     27 June – Excise duty payments  30 June – VAT electronic submissions and payments, & CIT Provisional Tax payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © AccountingDotNews

“In 2025/26, SARS will focus on addressing the tax gap to improve revenue collection.” (National Treasury Budget Review) With additional funding from National Treasury, SARS will now be better positioned than ever to collect the estimated R800 billion in unpaid taxes which SARS Commissioner Edward Kieswetter has identified as a better alternative than a VAT hike to balance the South African Budget.  Much of the estimated R800 billion in unpaid taxes consists of the so-called “tax gap” – the difference between how much tax is legally due to SARS and the amount that is actually paid on time. SARS has reported the following:  Just over R400 billion in undisputed uncollected debt Over R100 billion in debt currently under dispute More than 54 million outstanding returns dating back several years 156,000 South Africans with substantial economic activity who are not registered taxpayers, or are not filing their tax returns.  The remainder of the R800 billion unpaid taxes is made up by “aggressive tax planning” such as base erosion, transfer pricing, and other means of tax evasion, as well as unpaid excise duties, unpaid VAT, and illicit trade flows. Kieswetter said R2 billion of the additional R2.5 billion that SARS will receive for 2025/26 will be used for “a massive debt recovery programme”, while R500 million will be used to modernise SARS’ systems.    Given SARS’ enhanced capabilities and focus on collecting outstanding debt, our tax expertise will be crucial in ensuring you and your business maintain complete compliance and react immediately and correctly should your tax affairs become the subject of SARS’ scrutiny.  Tax compliance tick box  Maintaining compliance starts with:✔ Being registered for all applicable tax types within the stipulated time frames ✔ Making accurate declarations ✔ Filing returns and other required documentation on time ✔ Paying the correct amount of tax on time ✔ Promptly responding to SARS communications ✔ Paying penalties and interest for non-compliance, such as late submissions or under-declared income. How we can help you mind the tax gap   We can help you to comply with your specific tax obligations with up-to-date tax expertise and best practices.  We promptly and professionally respond to communications from SARS, such as notices of demand for unfiled returns, requests for information, or notifications of penalties levied. We take immediate and correct action following demands for outstanding tax debts. Taxpayers have ten business days after receiving a Final Demand to either pay, arrange deferral of payment or make a payment arrangement, file a suspension of payment with an objection, or enter into a compromise agreement. What’s more, our expertise and experience enable us to monitor that SARS is following the correct legal procedures. This ensures that your taxpayer rights are protected and preventing illegal collection measures such as unauthorised SARS withdrawals from bank accounts.  Bottom line SARS says it will be relentless in its efforts to collect the billions of rands in uncollected taxes, and that it is ready to act against those who wilfully and defiantly ignore their legal tax…

07 May – PAYE submissions and payments 23 May – VAT manual submissions and payments 29 May – Excise duty payments 30 May – VAT electronic submissions and payments, & CIT Provisional Tax payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © AccountingDotNews

Budget 2025, if adopted by Parliament,  will effectively bring about an increase in personal income tax by not adjusting the tables for tax rates, rebates and credits, while also implementing substantial increases in ‘sin’ taxes and introducing a 0.5% VAT increase on 1 May 2025 and another 0.5% increase effective 1 April 2026.   This selection of official SARS Tax Tables and other useful resources will help clarify your tax position for the new tax year.  Individual taxpayers: Tax tables unchanged since 2023Source: SARSSource: SARSSource: SARS Sin taxes raisedSource: Adapted from Budget 2025 People’s Guide Businesses: Corporate tax rates unchangedSource: Adapted from SARS Budget Tax Guide 2025 Proposed VAT increasesSource: Adapted from Budget 2025 People’s Guide Transfer duty: 10% upward adjustment from 1 AprilSource: SARS’ Budget Tax Guide 2025 How much will you be paying in income, petrol and sin taxes? Use Fin 24’s four-step Budget Calculator here to find out the monthly and annual impact on your income tax, as well as what you will be paying in fuel and sin taxes. Bear in mind, however, that the best way to fully understand the impact of the proposals in Budget 2025 on you and your business is to reach out to us for professional advice. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © AccountingDotNews

"A tax professional is someone who solves a problem you didn't know you had in a way you don't understand." (Carl Ally, adapted from a quote about architects) With tax compliance scrutiny intensifying and SARS increasing its detection capabilities with “the latest technology, artificial intelligence, and data science”, South African businesses face mounting pressure to keep their tax affairs 100% in order. To achieve and maintain this compliance, the expertise of a tax practitioner is invaluable – provided you are using a correctly registered practitioner. Do I even need a tax practitioner?  The specialised knowledge that registered tax practitioners offer greatly benefits businesses and individuals to navigate more complex tax matters, including:  multiple income streams  multiple tax obligations (income tax, VAT, PAYE, SDL, UIF) optimisation of complex deductions industry-specific tax considerations capital gains calculations strategic tax planning opportunities. Businesses that attempt to navigate tax matters alone or with unregistered help face significant risks like:  missed opportunities for legitimate tax efficiency exposure to penalties and interest charges for errors or oversights increased likelihood of verifications and audits reputational damage potential criminal liability in cases of serious mistakes and omissions. Using a registered tax practitioner can significantly reduce these risks, free up time to focus on your core business, and eliminate the stress of tax-related challenges. Why must a tax practitioner be registered?  Section 240(1) of the Tax Administration Act mandates that anyone who provides tax advice or completes tax returns on behalf of others must be registered with both SARS and a Recognised Controlling Body, such as SAIPA, SAICA, SAIT or CIBA. To provide clients with assurance that their tax affairs are in capable hands, these professional bodies impose stringent criteria on registered tax practitioners, ensuring they are:  qualified according to stringent industry-recognised criteria up-to-date with current tax legislation and professional development bound by professional codes of conduct or ethics accountable to a professional regulatory body able to provide recourse for substandard service or fraudulent activities covered by Professional Indemnity insurance supported by a technical support team for resolving complex tax issues. More benefits of using a registered tax practitioner Tax clarity and tailored tax advice: As SARS updates requirements and introduces new compliance measures, a registered practitioner can expertly advise your business in the evolving tax landscape. Strategic advice on legitimate tax efficiency measures like tax planning and structuring, industry-specific tax opportunities for your business, and additional services to streamline tax compliance.  Critical protection is provided by ensuring accurate and compliant tax calculations and returns, maintaining documentation for potential audits, and proactively identifying and addressing potential compliance issues. Direct representation during SARS engagements including lodging and managing disputes, and experienced negotiation capabilities.  Insurance cover: A registered tax practitioner carries Professional Indemnity insurance – providing an additional layer of protection should errors occur.   Maximise value from our tax team  As SARS intensifies its compliance efforts, the guidance and protection offered by our professional tax team will become increasingly valuable. Employing a registered tax practitioner is about much more than meeting a compliance requirement – it's…

01 April – Start of the 2025/26 Financial Year          07 April - PAYE submissions and payments             25 April – VAT manual submissions and payments             29 April – Excise duty payments       30 April – VAT electronic submissions and payments, & CIT Provisional Tax payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © AccountingDotNews

“When taxpayers are aggrieved by an assessment or a decision that is subject to objection and appeal, they have a right to dispute it.” (SARS) As a taxpayer in South Africa, you have the right to dispute tax assessments, if you have valid reason to disagree with SARS on the interpretation of either the relevant facts involved, or the laws that apply to the facts, or both. SARS has a well-established dispute resolution process – but it is also time-consuming and often complex, with strict deadlines and a substantial amount of administration. Here’s how we can help you manage the timelines and process for a (hopefully) successful dispute against a SARS assessment, including those that create unmanageable tax liabilities. A solid foundation is paramount Before lodging an objection, it’s crucial to make a Request for Reasons for a SARS assessment, which will detail SARS' findings of fact and the law it applied. You need this to build a solid objection. All substantiating documentation required for the objection must be collated, as it must be submitted with your objection within the objection period. It’s also important to ensure your other tax affairs are compliant, as your overall tax compliance status can influence SARS’ decision-making process. Maintaining updated contact details with SARS, checking your compliance status regularly, and reacting promptly to notification emails or SMSes from SARS are all vital – but we can take care of this for you. Pay now, argue later Where a disputed assessment involves a tax debt, the debt must be paid even if you are submitting an objection, thanks to SARS’ “pay now, argue later” principle. This is often a substantial challenge for taxpayers.  If you want to avoid paying immediately, a “Request for Suspension of Payment” must also be submitted timeously, in a separate process. If granted, this will prevent SARS from commencing collection proceedings on the outstanding amount until the objection is finalised. Ducks in a row Submitting a tax objection is a serious business. The validity and strength of the arguments and evidence to be presented in the objection should be carefully – and objectively – evaluated. The objection must detail the grounds on which the assessment is disputed, set out the parts or amounts in dispute and, depending on the nature of the dispute, address penalties and interest incurred. Substantiating documentation that provides evidence for the objection must be collated and submitted to SARS within the objection period. The bottom line: professional tax expertise is highly recommended when drafting an objection. Keep to tight deadlines Meeting the tight timelines is crucial for protecting your right as a taxpayer to dispute an assessment. By acting quickly and meeting deadlines, we can help you to ensure the best chances of resolving the dispute favourably. Important deadlines include: You have 30 business days after the date of assessment to make a Request for Reasons, which will extend the period within which an objection can be lodged.  The law allows 80 business days to file a Notice of…

07 March - PAYE submissions and payments 25 March – VAT manual submissions and payments 28 March – Excise duty payments 31 March – End of the 2023/24 Financial year, VAT electronic submissions and payments, & CIT Provisional Tax payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © AccountingDotNews

“Death, taxes, and childbirth! There’s never any convenient time for any of them.” (Margaret Mitchell) What is provisional tax? Provisional tax allows corporate and individual provisional taxpayers to pay their annual income tax in advance by making two or three payments during a tax year. The aim is to prevent taxpayers from facing large income tax liabilities that are only revealed at the end of the year of assessment, when the annual personal income tax (PIT) return ITR12 or the annual corporate income tax (CIT) return ITR14 is filed in January. While provisional tax payments can assist taxpayers by spreading their income tax liability over the tax year, they also create additional administrative obligations such as completing and submitting a provisional tax return (IRP 6) on time, twice or thrice a year. What’s more, they increase the risk of penalties, most notably under-estimation penalties. Luckily you have us in your corner. Are you a provisional taxpayer? Companies are automatically provisional taxpayers. Individuals who receive income other than a salary may also be provisional taxpayers, depending on various criteria. Because SARS places the onus on you to determine if you are liable for provisional tax, it’s best to check your provisional tax status with us. The 3 provisional tax payments The first compulsory provisional tax payment is due within six months of the start of the year of assessment. So, if your or the company’s 2025 tax year commenced on 1 March 2024, the first provisional tax payment was due on 31 August last year. This forward-looking payment is based on half of the total estimated tax for the full year, less employees’ tax already paid and any applicable tax credits and rebates.  The upcoming second compulsory provisional tax payment deadline is the last working day of the year of assessment (on 28 February if your tax year started on 1 March). It works somewhat differently, and the rules are far stricter – with harsh penalties for under-estimating taxable income for the year. A third optional payment can be made after the end of the tax year, but before the issuing of the annual income tax assessment by SARS each year. Crunch time! The provisional return for the second period to 28 February is retrospective and based on the total estimated tax for the full tax year (less the first period provisional tax and employees’ tax already paid, and any applicable tax credits and rebates). The second estimate must be quite accurate as heavy under-estimation penalties apply. Where the taxable income is less than R1 million; and the second period estimate is less than 90% of the actual taxable income and less than the ‘basic amount’ (taxable income assessed for latest preceding year of assessment), a 20% penalty is imposed on the difference between the employees’ and provisional tax already paid and the lesser of normal tax on 90% of the actual taxable income or normal tax on the basic amount, after deductible rebates. Where the taxable income is more than…

07 February – Monthly PAYE submissions and payments 25 February – Value Added Tax (VAT) manual submissions and payments 27 February – Excise duty payments 28 February – VAT electronic submissions and payments, Corporate Income Tax (CIT) Provisional Tax payments where applicable, and Personal Income Tax (PIT) Provisional Tax payments.  Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © AccountingDotNews

"Being tax compliant and ‘paying your fair share’ is not just good for you, but also contributes to the positive growth of our country’s economy which in turn benefits all South Africans." (SARS) Being tax-compliant is a legal requirement for all South Africans.  SARS says it will be unrelenting in driving voluntary compliance in pursuing the 2024/25 tax revenue target of R1,840.8 billion.  To expand the tax base, detect dishonest taxpayers, deal with tax avoidance, expand debt collection, and improve service levels, SARS will:   Deploy more data science and artificial intelligence (AI). Broaden the tax base via third-party data sources (banks, medical schemes, fund administrators etc. Use predictive modelling to ensure all taxpayers and traders are registered, filing returns and paying dues.  Build detection capability using machine learning models and AI.  Enforce Customs and Excise trade laws against the illicit economy. Focus on dispute prevention and resolution. Importantly, SARS is ready to act against those who willfully and defiantly ignore their legal obligations by misrepresenting their true economic status. SARS will impose significant legal and administrative costs on taxpayers and traders who deliberately fail to meet their obligations.   What does tax compliance look like? Your company needs to: Be registered with SARS for all the tax types applicable to your company. Have either merged or declared all registered tax reference numbers on eFiling. Timeously submit all tax returns and other documentation requested. Keep all registered particulars updated. Pay all tax debt on time, or timeously secure a payment arrangement or suspension of payment. Deregister the business if it is liquidated or closed. Remember that your tax compliance status is not static: it changes according to your continued compliance with tax requirements month after month. Also remember that SARS can impose both monetary and criminal sanctions to enforce compliance. This is a significant business risk, because the burden of proof, should a taxpayer disagree with a decision taken by SARS, lies with the taxpayer. In the event that the taxpayer fails to argue their case successfully, they may find themselves in a position where penalties are suffered even if the error was unintentional or administrative in nature. Benefit from the advantages of tax compliance When you comply with your tax obligations, you give your business some compelling advantages. Eliminate the costs of non-compliance, like penalties, interest, and additional accounting and admin fees. Avoid the risk of criminal offences, which may result in a fine, imprisonment or both. Common offences include not registering for a tax type, or simply not submitting tax returns.  Proof of tax compliance is considered an indicator of good company management and legal good standing.  Good standing tax clearance certificates are often required for tender applications, bidding processes or prequalification as a supplier. They can also be needed to receive payment, or for foreign investment allowances.  Compliance enables companies to gain the confidence of clients, stakeholders and investors; take advantage of business opportunities; and prevent reputational damage. Help is at hand Now more than ever before, professional…

“A goal without a plan is just a wish.” (Antoine De Saint-Exupery, author of The Little Prince) Want to start a business? SARS warns you to be aware of the tax obligations of running a business, whether it’s in the form of a legal entity or in your personal capacity.  Considering the tax implications before starting a business will result in substantial benefits down the line. These include better budgeting and cash-flow planning, cost savings, and easier administration and compliance. Pound of flesh Depending on the type of business entity you establish, different tax rates and rules apply. On the flip side, certain tax incentives and opportunities to reduce the administrative burden may be available.  Legal entities like private companies, close corporations (CCs) and non-profits are automatically registered with SARS for corporate income tax when they register with the Companies and Intellectual Property Commission (CIPC).  This is not required for a non-legal entity like a sole proprietorship or partnership. In these cases, the owner or partners are taxed in their individual capacities on their share of taxable profits. Certain tax rebates and credits apply, which can reduce overall tax liability. Legal entities may qualify for different tax incentives and preferential rates like the turnover tax system, the small business corporation (SBC) incentive, or accelerated deprecation relief available in Urban Development Zones. Corporate Income Tax (CIT)  Every business (legal entity or individual) is liable for income tax. But the rates of taxation – and the rules – can vary widely.  For companies (including CCs) the standard corporate tax rate is 27%. In addition to filing an annual return, companies are required to submit provisional tax returns twice a year – and to make the required payments on time. Turnover tax is a possible alternative for sole proprietors, partnerships, CCs and companies with a qualifying annual turnover not exceeding R1 million. This simplified annual tax, calculated on your turnover, replaces income tax, provisional tax, VAT, capital gains tax and dividends withholding tax (if the annual dividend does not exceed R200,000). This substantially reduced administrative burden is a significant benefit for small businesses. The first R335,000 of annual turnover is tax exempt – and the highest tax rate is just 3%. Qualifying companies may register as a small business corporation (SBC) for additional tax incentives, including a tax exemption for the first R95,750 of annual taxable income, and a reduced corporate tax rate up to a taxable income of R550,000. Employee taxes Every employer must register for pay-as-you-earn (PAYE), deduct it from remuneration paid to employees (along with Unemployment Insurance Fund contributions) and pay it over to SARS. Once annual salaries, wages and other remuneration exceed R500,000, the Skills Development Levy (SDL) also becomes payable. As an employer, you must submit monthly returns and payments to SARS. There are also two compulsory reconciliations during the year.  Some relief is available through the Employment Tax Incentive (ETI), allowing for a reduction in PAYE for qualifying companies that employ young people. VAT (Value Added Tax)   VAT registration becomes compulsory if…

07 January – PAYE submissions and payments. 20 January – End of Filing Season 2024 for Provisional taxpayers & Trusts. 24 January – VAT manual submissions and payments. 30 January – Excise duty payments. 31 January – VAT electronic submissions and payments, & CIT Provisional Tax payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © AccountingDotNews

“The hardest thing in the world to understand is the income tax.” (Albert Einstein) With an increasing amount of business being conducted online, it’s perfectly possible to live in one country and earn an income in another. If you are conducting services for global corporations and earning foreign income in another country, you could get caught up in a world of tricky tax situations. Under these circumstances, you can find yourself being taxed twice, both in the country where the business is conducted and here at home in Mzansi. To prevent this scenario and encourage South African residents to bring valuable foreign income into the country, the government has enacted Double Taxation Agreements (DTAs) with 79 foreign powers. If applied correctly at tax time, a DTA should mean you don’t pay tax twice. But how does this work, and just where are the pitfalls? Check your residency status Many people incorrectly believe that DTAs mean that income earned in a foreign country is taxable in that country. While the exact terms of each DTA are different, most DTAs actually give taxing rights on employment income to the residential country, unless the services are rendered elsewhere. This means that if you live in South Africa, you should pay all of your taxes in South Africa. On this basis, any taxes also paid to the government of the country in which the income was earned might qualify you for tax relief in South Africa. Surprisingly though, in some cases, and depending on the domestic legislation in the particular country, an individual may find themselves tax resident in both South African and the other country, regardless of where you live. This can have enormous implications on your legal obligations and the taxes you end up paying. Luckily, all DTAs cater for such instances, with a set of rules to apply to determine which of the two countries you will ultimately be deemed tax resident in. That’s why it’s vital to ask your accountant to first examine the laws and determine just where you are officially resident and how the specific DTA applies in your case. Do you need a tie-breaker? Some South African residents working in foreign countries should normally be given tax residency certificates by the country where they make their income. But don’t fall into the trap of assuming this means you’re not a South African tax resident. More likely you now have dual residency for tax purposes and will be required to apply a tie-breaker test under the specific terms of the relevant DTA to determine just where and how you need to pay taxes. For something that was supposed to make things simpler and decrease the tax burden on residents earning money overseas, DTAs can actually be somewhat onerous. Does the DTA even apply? The fact that there’s a DTA between South Africa and the country of your income may fool you into thinking you’re automatically exempt from paying taxes in one of the two countries, but this is…

06 December – Monthly Pay-As-You-Earn (PAYE) submissions and payments 24 December – Value-Added Tax (VAT) manual submissions and payments 30 December – Excise Duty payments 31 December – Corporate Income Tax (CIT) Provisional Tax payments 31 December – End of the 3rd fiscal quarter 31 December – Value-Added Tax (VAT) electronic submissions and payments Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice. © CA(SA)DotNews

“Over the next few years, we are also implementing a global minimum corporate tax to limit the negative effects of tax competition.” (Enoch Godongwana, Minister of Finance, Budget 2024) There have been significant shifts in the corporate income tax landscape in South Africa and globally. Recent trends noted by the OECD and The Tax Foundation include: Statutory corporate income tax rate changes in 13 countries in 2023 A reversal of a two-decade downward trend in corporate tax rates An increase in the average global CIT rate from 20% to over 21% in the last year. Corporate tax rates have declined from the highs of an average 40% in 1980 and 28% in the early 2000s to around 21%. South Africa has also reduced its CIT rate over the years, from 30% in 2000 to 27% in 2022 – but it is still substantially above the international average. A new global tax treaty Dubbed “an historic step towards changing the financial landscape”, 110 UN Member States, including South Africa, recently voted in favour of the terms of reference for a new global tax treaty. The UN says that all 193 UN Member States could vote on a finalised UN global tax treaty as early as 2027. In the meantime, more than 140 countries have already agreed to this global minimum tax, and some have already implemented this tax reform, including South Africa. Finance Minister Enoch Godongwana announced in his 2024 Budget Speech that South Africa will be implementing the global minimum tax with effect from years of assessment commencing on or after 1 January 2024. Why a minimum global tax? Multinational companies use tax planning strategies, like moving profits to low-tax jurisdictions, to minimise their tax liabilities. A global minimum tax aims to ensure that these multinationals pay their fair share of taxes, regardless of where they operate. This limits the race to the bottom of effective corporate tax rates for large multinationals, with countries competing to attract income by offering low tax rates and tax incentives. On a social responsibility level, it goes without saying that companies should contribute fairly to the financial stability of the countries they operate in. Who is affected? A global minimum tax will ensure that any multinational enterprise group with annual revenue exceeding €750 million (+-R15 billion) will be subject to an effective tax rate of at least 15%, regardless of where its headquarters, operations, sales or profits are located. Implementation in South Africa Government plans to introduce two measures to effect this change for qualifying multinationals: The income inclusion rule applies to multinational entities headquartered in South Africa and requires a tax top-up if the effective rate in the jurisdictions the multinational entity operates in is lower than 15%. This tax is payable to SARS as opposed to the relevant jurisdiction. The domestic minimum top-up tax applies in situations where the multinational entity’s effective tax rate in respect of its South African profits is lower than 15%. In such circumstances, the South African constituent entities…

07 November – Monthly PAYE submissions and payments 25 November – Value Added Tax (VAT) manual submissions and payments 28 November – Excise duty payments 29 November – VAT electronic submissions and payments, Corporate Income Tax Provisional Tax payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“The interim reconciliation process has become an integral part of the employer reconciliation and assists employers…” (SARS) Employers are assisted by the interim EMP501 reconciliation, says SARS, because it makes it easier to: make more accurate annual reconciliation submissions maintain an up-to-date employee database register employees for income tax purposes Of course, there are other benefits, such as maintaining your compliant tax status, and avoiding wasting money on stiff penalties and interest. It goes without saying that you want to reap all these benefits for your business. Allow us to help you to understand what needs to be done. We will be able to assist in ensuring a smooth, hassle-free submission process – even with the next deadline right around the corner. EMP501 Reconciliation fast facts All employers are required to submit an EMP501 Reconciliation There are two deadlines in each tax year. For the 2025 tax year the deadlines are: 31 October 2024 – 2025 Interim Reconciliation (for the period 1 March 2024 – 31 August 2024) 31 May 2025 – 2025 Annual Reconciliation (for the period 1 September 2024 – 28 February 2025) Potential pitfalls The EMP501 Reconciliation is an intricate process which creates many opportunities for errors: Payroll information must be verified Correct deduction of employees’ tax (PAYE), Skills Development Levy (SDL), and Unemployment Insurance Fund (UIF) contributions must be verified Deductions must reconcile with IRP5 / IT3(a) tax certificates Employment Tax Incentive (ETI) values claimed must be reconciled EMP201 returns must be reconciled with actual payments made to SARS EMP201 returns must be reconciled with EMP501 statements Employee information needs to be updated on eFiling Employees without tax numbers must be registered Employer’s Reconciliation Declaration (EMP501) needs to be submitted via the eFiling website or the e@syFile application This is an intricate and time-consuming process, and, as SARS puts it, “accuracy and timely filing are critical”. Consequences of non-compliance This is serious business. Inaccuracies or late submission can result in severe consequences. Calculating PAYE liability incorrectly will result in the imposition of both penalties and interest. This includes corrections made on the EMP501 reconciliation, as any shortfall is attributed to the last month of the reconciliation period. If an employer submits their EMP501 late, administrative penalties will be charged. The penalty will equal 1% of the year’s PAYE liability, increasing each month by 1% (up to a maximum of 10% of the year’s PAYE liability). An employer who wilfully or negligently fails to submit an EMP201 or EMP501 return to SARS is guilty of an offence and could face a fine or imprisonment for a period of up to two years. The bottom line The penalties are stiff, and the submission process is fraught with opportunities for inaccuracies and errors. We understand the importance of tax compliance to your business. And we have the expertise and experience to help ensure a smooth and stress-free submission for you.  Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for…

07 October – Monthly PAYE submissions and payments 21 October – End of filing season for individual taxpayers (non-provisional) 25 October – Value Added Tax (VAT) manual submissions and payments 30 October – Excise duty payments 31 October – VAT electronic submissions and payments, Corporate Income Tax Provisional Tax payments where applicable, and Personal Income Tax Top-up Provisional Tax payments. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“A Trust is a ‘person’ for tax purposes and is therefore a taxpayer in its own right.” (SARS) With Tax Season 2024 for trusts opening on 16 September, there’s no better time to draw trustees’ attention to SARS’ continued emphasis that all trusts must register for income tax purposes, including dormant trusts. Once registered, trusts are obligated to submit income tax returns that are aligned with other trust reporting requirements from SARS and substantiated by extensive supporting documents and information. Trustees are held responsible for non-registration of trusts for income tax, and they will not be able to evade enforcement actions by blaming third parties for failing to file returns. “But I didn’t know I was meant to,” is not a valid excuse. Trust tax returns can be filed from 16 September 2024 (much later than the usual June/July opening) until 20 January 2025. Along with the new filing season dates, trusts also face several onerous compliance requirements – and some stiff potential penalties. Onerous requirements SARS introduced changes to the Income Tax Return for Trusts (ITR12T) last year, with additional probing questions, and even more mandatory supporting documents. The range of mandatory and supporting documents that must be submitted with the ITR12T depends on the trust type, and may include: All certificates and documents relating to income and deductions Trust Deed and Letters of Authority Resolutions/minutes of trustee meetings Details of the ‘Main’ Trustee (the SARS registered representative) Financial statements and/or administration accounts Particulars of assets and liabilities Confirmation of banking details Proof of payment of any tax credits Supporting schedules Detailed disclosure of the beneficial ownership, including the submission of identity documents of all beneficial owners. This information will be checked against the beneficial ownership register lodged with the Master of the High Court. Non-compliance could result in a trustee receiving a fine of up to R10 million, a prison sentence of up to 5 years – or both. To provide SARS with a clearer understanding of the assets, income and activities within trust structures, trust returns now feature additional questions such as any local or foreign amounts vested in the trust as a beneficiary of another trust. Information reported on the trust tax return must also align with the IT3(t) reporting of prescribed information by trusts, now also mandated by SARS. It includes trust distributions and their beneficiaries, trust and beneficiary demographic information, trust financial flows, and amounts vested in a beneficiary, including net income, capital gains and capital amounts. The first IT3(t) certificates are due to be submitted at the end of September 2024 for the 2023/24 tax year, and then on an annual basis. Despite the above reporting deadline, SARS confirmed that trust beneficiary income tax returns will not be pre-populated with IT3(t) data for the 2024 year of assessment. This means trustees must also provide details of trust beneficiaries’ 2024 trust earnings timeously to the beneficiaries for inclusion in their personal income tax returns, for which the submission deadlines remain unchanged despite the change…

06 September – Monthly Pay-As-You-Earn (PAYE) submissions and payments 16 September – Start of Filing Season 2024: Trusts 25 September – Value Added Tax (VAT) manual submissions and payments 27 September – Excise duty payments 30 September – VAT electronic submissions and payments, Corporate Income Tax Provisional Tax payments where applicable, and Personal Income Tax Top-up Provisional Tax payments. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“The hardest thing in the world to understand is the income tax.” (Albert Einstein)  Tax rebates, deductions and incentives provide relief to taxpayers by reducing the amount of tax payable to SARS, resulting in welcome tax savings. But how do you figure out which rebates, deductions or incentives apply to you – and what’s the procedure for claiming them? This is where we come in. Chances are we’ve already applied a number of these rebates, deductions or incentives to your tax returns. But here’s a list of some of the tax rebates, deductions and incentives that could make a substantial difference to your SARS bill for the 2024 Tax Season. Some of them are fairly wellknown, but others are pretty obscure. If you think you qualify for additional rebates, deductions or incentives, please do get in touch. We are committed to ensuring that you don’t pay more tax than you should. For individuals Tax threshold: You only start paying tax when you earn more than R95,750 (under 65 years); or R148,217 (65 - 75 years); or R165,689 (75 and older). Tax rebates: Taxpayers also qualify for a R17,235 primary rebate; an additional secondary rebate of R9,444 if over 65, and a further tertiary rebate of R3,145 if over 75.   Medical tax credits for medical scheme contributions can be deducted from your tax payable at R364 each per month for you and your first dependent, and R246 for each subsequent dependant. The additional medical expenses tax credit allows qualifying out-of-pocket medical expenses to be deducted from the normal tax payable. This applies to medical expenses that were not recovered from your medical aid.  Retirement fund contributions to a locally-registered pension, provident, or retirement annuity fund are deductible subject to certain maximum limits. Amounts received/accrued from tax-free investments are exempt from tax, subject to limitations. Donations to certain approved public benefit organisations are allowed as deductions, up to a maximum of 10% of taxable income. A solar energy tax credit of 25% of the cost of the solar PV panels (maximum R15,000) is available for new and unused solar PV panels acquired and used for the first time between 1 March 2023 to 29 February 2024. Home office expenditure: Employees who have a dedicated area used regularly and exclusively for “trade” in their home may be allowed to deduct, pro-rata, certain expenses like rent, repairs, utilities, phones and internet.  The foreign tax credit is a rebate against income tax for foreign taxes paid on foreign-sourced income.  Taxpayers carrying on a business in their individual capacity or in partnership may deduct business expenditure or losses on the same basis as companies. For businesses Tax relief measures for small business corporations (SBCs) allows for a progressive tax rate, immediate write-off of new plant or machinery, and a wear-and-tear or accelerated allowance on depreciable assets. Tax relief for qualifying micro businesses involves a simplified turnover tax, instead of the usual taxes (income tax, provisional tax and Capital Gains Tax) payable by companies. Energy efficiency savings incentive provides a deduction for savings from implementing energy-efficient methods in the production…

“We urge taxpayers to be transparent and accurate when filing their tax returns to enable a constructive relationship with SARS.” (Edward Kieswetter, SARS Commissioner) July 15 marked the start of the 2024 Filing Season for provisional and non-provisional taxpayers who were not subjected to auto-assessments, covering the tax period 1 March 2023 to 29 February 2024. As part of our quest to simplify your life, we’ve compiled a list of the timelines and the changes since last year. But first, here are five ways we can help you this tax season. 5 ways we’ve got your back We can help you avoid non-compliance. SARS has warned that the use of technology and data has enhanced its ability to detect non-compliance such as, for example, not including rental income in a return, which could potentially make you guilty of fraud. Our team is up to date with the many changes in tax legislation introduced each year and our understanding of the complexities and intricacies will streamline your filing season. We ensure all the boxes are ticked on every tax return you need to submit. This will help you to avoid a SARS audit where possible, and to ensure any verification or audit can be concluded quickly and cost-effectively. We make sure that you claim every tax rebate, deduction or incentive available to you, so you don’t under-claim and pay more tax than required. We protect you from scams. Sadly, filing season is also scamming season. We are alerted about all the latest scams and keep your information with SARS updated to prevent fraud and identity theft. Dates to diarise Changes to take note of Various changes have been made since last year – the quickest way to find out if any of these apply to you or your business is simply to contact us. The pool of auto-assessed taxpayers increased to about 4.8 million this year, compared to around 3.8 million taxpayers last year. A solar energy tax credit of 25% of the cost of the solar PV panels (maximum R15,000) is available for new and unused solar PV panels acquired and brought into use for the first time by individuals between 1 March 2023 and 29 February 2024. Pro rata retirement fund contribution deductions are now allowed if an individual taxpayer’s year of assessment is less than 12 months. Exemption of tax-free investment amounts received or accrued: if your year of assessment is less than 12 months, the applicable contribution limit (currently R36,000) will be applied pro rata. Deductions in respect of buildings in Urban Development Zones – the allowable deduction has been extended until 31 March 2025. There’s a redesigned renewable energy tax deduction for certain machinery, plant, implements, utensils and articles used in production of renewable energy. ITR12 Form changes affecting the foreign employment income exemption and Beneficial Owner (BO). The bottom line If this is all a tad confusing, fret not! Our team of seasoned tax professionals will make all the difference this filing season. We are…

07 August – Monthly Pay-As-You-Earn (PAYE) submissions and payments 23 August – Value Added Tax (VAT) manual submissions and payments 29 August – Excise duty payments 30 August – VAT electronic submissions and payments, Corporate Income Tax Provisional payments where applicable, and Personal Income Tax Provisional payments. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“The aim of a tax audit is to determine if the taxpayer has complied with the relevant legislation administered by SARS.” (SARS) During a tax audit, SARS examines financial statements, accounting records and supporting documents to check if you or your business correctly declared your tax position on a tax return. If you didn’t submit a return, an audit will investigate if your actions complied with tax law. Either way, being selected for an audit – whether for income tax, VAT, employees’ tax or capital gains tax – poses significant risk. What are the risks of an audit? A substantial amount of time, cost and effort can be required to collate the information, documents and clarifications needed to complete an audit … Especially if the audit spans several years. If you don’t submit the requested audit information, SARS will raise a revised assessment, determining the amount of your tax liability or refund, based on an estimate from information readily available or obtained from a third party, even if this information is incomplete. What’s more, an audit can lead to the levying of understatement penalties of up to 200% of the shortfall where an understatement occurred. The 200% penalty is levied in instances where the taxpayer is either a repeat offender or is being obstructive and  is also guilty of intentionally evading taxes. Worst case scenario An audit can even result in criminal proceedings. It’s a criminal offence to refuse or neglect to supply relevant material requested by SARS without just cause. And remember: SARS is no longer required to prove that a taxpayer wilfully committed a tax crime – taxpayers can now be found guilty of a tax crime if a mistake was made, or in cases of negligence. The risk is intensifying SARS audits are increasingly common. Any taxpayer can be selected for audit, based on any consideration, including on a random or cyclical basis, or on a risk assessment basis. Even tax-compliant companies and individuals that get clean audits every year are regularly audited. Taxpayers are flagged for audit through SARS’ sophisticated case selection methodology. The taxpayers most likely to be audited include those who earn additional income and those whose tax returns do not align with information from other sources, for example, where there is a mismatch between the annual turnover and the VAT declarations for the year. The audit process A Notification of Audit letter provides the initial scope of the audit, documents required, and details of the SARS auditor. SARS can request additional material at any time, and they can obtain information from third parties. SARS prefers to receive audit documents electronically via eFiling or for them to be submitted at a SARS branch, but collection or delivery of documents can be arranged. An audit can take between 30 business days and 12 months to complete – or even longer in some cases. The time taken to complete an audit depends on the complexity of the specific case. SARS will provide progress reports on the audit…

05 July – Monthly Pay-As-You-Earn (PAYE) submissions and payments 25 July – Value-Added Tax (VAT) manual submissions and payments 30 July – Excise Duty payments 31 July – Corporate Income Tax (CIT) Provisional Tax payments 31 July – Value-Added Tax (VAT) electronic submissions and payments. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

07 June – Monthly Pay-As-You-Earn (PAYE) submissions and payments 25 June – Value-Added Tax (VAT) manual submissions and payments 27 June – Excise Duty payments 28 June – Corporate Income Tax (CIT) Provisional Tax payments 28 June – End of the 1st fiscal quarter 28 June – Value-Added Tax (VAT) electronic submissions and payments. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“Failure by an employer to comply with its obligations does not only harm that employer and the fiscus, but also employees. SARS vigorously pursues employers that fail to comply.” (SARS) Employers must submit their annual reconciliation declarations (EMP501) with accurate and up-to-date payroll information about their employees by 31 May this year. This is among the requirements imposed on employers by the Fourth Schedule to the Income Tax Act: deducting or withholding employees’ tax from remuneration, paying the above to SARS monthly before the 7th of the following month, reconciling employees’ tax during the annual and the interim reconciliation, and issuing tax certificates (IRP5s/IT3(a)s) to employees timeously. A SARS focus area The employer-reconciliation process is a focus area for SARS, not only to ensure compliance among employers, but also because it enables SARS to issue individuals with income tax auto-assessments. SARS uses the IRP5/IT3(a) certificate information submitted by employers through the annual reconciliation process to prepopulate the employees’ annual income tax returns (ITR12), and employees cannot change this information. This means the employer-reconciliation process is also a key phase in the Income Tax Filing Season, because incomplete or incorrect information will make it difficult for employees to fulfil their tax obligations and because employees require IRP5 and IT3 certificates to file their income tax returns in time during tax season. As such, SARS says it vigorously pursues employers that fail to comply and, where necessary, aims to make tax non-compliance hard and costly through hard enforcement, for example, court action, asset seizure and criminal prosecution. What needs to be done? Register employees who are not registered for income tax. Review the year’s EMP201 declarations that declare the total tax liability for each tax period for: Employees’ Pay-As-You-Earn (PAYE) tax, Unemployment Insurance Fund contributions (UIF), Skills Development Levy (SDL) Employment Tax Incentive (ETI) amounts (if applicable). Submit any outstanding monthly declarations (EMP201) and settle all payments due to avoid administrative penalties for non-compliance or late submission, and to reduce interest charges on delayed or outstanding amounts. Ensure the values on the EMP201 declarations and on the tax certificates balance to the actual payments made to SARS. If any discrepancies are identified in the EMP201 declarations, these must be corrected when submitting the EMP501. The EMP501 Annual Reconciliation Declarations must include: Monthly employer declarations (EMP201). Information about payments made (excluding penalties and interest paid). Employee tax certificates (IRP5/IT3(a) generated) covering the tax year from 1 March 2023 to 29 February 2024. Monitor the status of your submission to ensure the EMP501 has been successfully filed with SARS – a submission rejected as incomplete or due to a data error is considered not to have been submitted, and the taxpayer will be liable for non-compliance penalties. Keep accessible employer records with a register that contains each employee’s personal details and financial records as prescribed by the Commissioner for at least five years. Also complete the interim reconciliation process in September/October each year to enable an easier and more accurate annual reconciliation submission and an up-to-date…

07 May – PAYE submissions and payments 24 May– Value-Added Tax (VAT) manual submissions and payments 30 May – Excise duty payments 31 May – VAT electronic submissions and payments, & Corporate Income Tax (CIT) Provisional Tax payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“[The new requirements] enable… a more efficient process to make deductions available to qualifying donor taxpayers and to help prevent section 18A claims abuse.” (SARS) Public benefit organisations (PBOs) are engaged in public benefit activities for example religious institutions, day care centres, disaster relief organisations, health clinics, etc. Many are dependent on donations and, to encourage the public’s generosity, a tax deduction for certain donations made by taxpayers is provided. Qualifying PBOs (i.e. section 18A-approved organisations) may issue tax certificates – called section 18A receipts – to donors.    This tax certificate – or section 18A receipt issued by a section 18A-approved organisation – entitles you or your company to a deduction from taxable income for bona fide donations in cash or of property. While approved section 18A institutions were previously required to keep records of all section 18A receipts issued, the requirements have changed, affecting both PBOs and their private and corporate donors. PBOs: New requirements, and a 31 May 2024 deadline Previously, the information that had to be provided by a PBO for a valid section 18A certificate was limited to the details of the PBO; details of the date, amount or nature of the donation; confirmation of how the donation would be used; and the name and address of the donor. Last year, SARS issued further requirements for more detailed information to be included on all section 18A certificates issued from 1 March 2023. This includes the nature of the donor; the donor’s identification or registration number; donor trading name (if different from the registered name); donor income tax reference number; donor contact number and e-mail address; and a unique receipt number. In addition, this year – like other third parties such as the banks, medical schemes and fund administrators required by law to send data to SARS – all PBOs are now also required to submit bi-annual reports – called an IT3(d) – to SARS. The first deadline for PBOs in this respect is 31 May 2024. From this date, approved section 18A tax exempt institutions must submit data on section 18A tax deductible receipts issued, which includes information on the S18A approved tax exempt institution, donation information and donor information for the 2023/2024 year of assessment (i.e. S18A receipts data from 01 March 2023 to 28 February 2024) by submission of IT3(d) data via efiling. Professional assistance is essential While it has always been best practice to check with your accountant first before making a donation and relying on the tax break, it is now more crucial than ever for companies and individuals to ensure that the PBO being supported, as well as the tax certificate – or section 18A receipt – issued to obtain a tax deduction, meet SARS’ new requirements. Also remember to check the limits: the amount of donations which may qualify for a tax deduction is limited to up to 10% of taxable income. We can also help PBOs to ensure they can meet the new requirements and deadlines, to ensure compliance and that their donors…

05 April – Monthly Pay-As-You-Earn (PAYE) submissions and payments 25 April – VAT manual submissions and payments 29 April – Excise Duty payments 30 April – Value-Added Tax (VAT) electronic submissions and payments & CIT Provisional payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

Budget 2024 effectively brought an increase in personal income tax by not adjusting the tables for tax rates, rebates and medical tax credits, while also implementing substantial increases in ‘sin’ taxes and introducing a proposed global tax on multinational companies. This selection of official SARS Tax Tables and other useful resources will help clarify your tax position for the new tax year. Then follow the link to Fin 24’s Budget Calculator (just follow the four-step process) to perform your own calculation. Individual taxpayers – tax tables unchanged Source: SARS Source: SARS Source: SARS Businesses – Corporate tax rates – extended Sources: SARS’ Budget Tax Guide 2024; Budget Speech 2024 Sin taxes increased Source: Budget 2024 People’s Guide How much will you be paying in income, petrol and sin taxes? Use Fin 24’s four-step Budget Calculator here to find out the monthly and annual impact on your income tax, as well as what you will pay in future in terms of fuel and sin taxes, bearing in mind that the best way to fully understand the impact of the announcements in Budget 2024 on your own and your business affairs is to reach out to us for professional advice. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

07 March – Monthly Pay-As-You-Earn (PAYE) submissions and payments 25 March – VAT manual submissions and payments 27 March – Excise duty payments 28 March – End of the 2023/24 Financial year, Value-Added Tax (VAT) electronic submissions and payments, & CIT Provisional payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“Provisional tax is merely a mechanism to pay the normal income tax liability during the tax year… an advance payment of a taxpayer’s normal tax liability.” (SARS) To provisional taxpayers, especially those who are liable for provisional tax in both their personal capacities and as business owners, it may well seem that there are endless provisional tax deadlines and payments to be made every year. There are indeed numerous income tax provisional and final declarations and payments that overlap across tax years, which is certainly confusing, and yet non-compliance is met with some of the harshest penalties imposed by SARS, most notably in respect of the second provisional tax declaration and payment, due by the end of February for individuals, and for companies with a February financial year end. In this article we find out who are provisional taxpayers, what they need to pay and when and how to avoid the penalties for non-compliance. What is provisional tax? Provisional tax is not a type of tax, but a cash flow mechanism to collect pre-payments of taxes that must be made in respect of individual provisional taxpayers’ and company taxpayers’ normal annual income tax prior to a final determination of the annual tax liability. At least two amounts are paid in advance during the year of assessment, based on estimated taxable income for the year of assessment. A third optional payment can be made. Why must provisional tax be paid? Ensures government collects cash more evenly during the year and not just in bulk amounts following final tax assessments which are annual and usually in similar time periods e.g. end of December or February. Spreads the payment of a taxpayer’s year’s income tax liability over two or even three provisional payments. Prevents taxpayers facing large income tax liabilities that are only revealed at the end of the year of assessment when the annual personal income tax (PIT) return ITR12 or the annual corporate income tax (CIT) return ITR14 is filed. The first, second and third provisional payments are credited against any tax owing after the final income tax return is filed, and any further tax liability will then become due. Reduces the risk and amount of interest accruing between the time when a tax liability is determined and when it is paid. Who must pay provisional tax? Provisional tax is paid by individuals who earn income other than, or in addition to, a salary or traditional remuneration paid by an employer from which PAYE deductions are made – including those who earn income from conducting a business, such as members of CCs, sole proprietors and company owners. Companies and trusts. Any person notified by the Commissioner of SARS. Exceptions and thresholds apply in every instance, so be sure to check with your accountant. When is provisional tax due? Below is an example of the provisional and final income tax due dates for: The 2024 year of assessment (1/03/23-29/02/24) and The 2025 year of assessment (1/03/24-28/02/25) for a company with a February financial year…

07 February – Monthly Pay-As-You-Earn (PAYE) submissions and payments 23 February – Value-Added Tax (VAT) manual submissions and payments 28 February – Excise Duty payments 29 February – CIT Provisional Tax payments 29 February – PIT Provisional Tax payments 29 February – Value-Added Tax (VAT) electronic submissions and payments Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“SARS is willing and ready to assist taxpayers who want to be compliant. Where taxpayers willfully and intentionally ignore their legal obligations, SARS will act sternly.” (SARS Commissioner Edward Kieswetter) Businesses are often required to share their tax compliance status, for example for a tender application, bidding process or prequalification as a supplier; to confirm that their tax affairs are in order with SARS; to receive payment; or for foreign investment allowances. This is because proof of tax compliance is accepted as an indicator of how well a company is managed and its good standing in terms of its legal obligations. Tax compliance also saves time and money. SARS provides clear advice to owners of small, micro and medium enterprises (SMMEs) on how to achieve tax compliance, both in the business and in their personal capacity, including a recommendation to seek the advice of an accountant. Which tax types apply to you and your business? This handy table from SARS details the tax types that generally apply to SMME businesses and their owners. Source: SARS Compliance life cycle The “compliance life cycle” as SARS calls it, applies to each one of the tax types for which the business and the owner are liable. It involves completing these steps in your tax relationship with SARS from beginning to end:  Registration on SARS’ system for each tax type applicable; Timely and correct declarations or returns for each tax type, including submitting relevant supporting documents; Timely payments where a tax liability exists; and Deregistration from tax types if the business is liquidated or closed. To meet these requirements consistently across all the relevant tax types over the tax year, in an always-changing tax landscape, taxpayers should consider professional assistance. Consequences of non-compliance Non-compliance is a costly choice, generally involving penalties and interest, as well as additional fees to rectify, and potentially further losses, such as losing a business opportunity or the confidence of clients, stakeholders and investors, or suffering reputational damage. In addition, not registering for a tax type to evade paying taxes, as well as the non-submission of tax returns are criminal offences, which may result in a fine, imprisonment or both. Outstanding returns will also negatively affect tax compliance status, and administrative penalties that will attract interest may be incurred for non-submission. Where tax liabilities have not been paid, and no payment arrangement has been made, penalties and interest will also apply, tax compliance status will be affected, and SARS may appoint third parties, such as a registered bank, to recover the outstanding tax.  Ensuring compliance Human errors and simple mistakes are common given the complex tax types, rules and strict deadlines. Nevertheless, a taxpayer can be found guilty of an offence without SARS having to show that the taxpayer committed it wilfully, deliberately and knowingly. It means that even unintentional or administrative errors can be penalised with a maximum penalty and, in some cases, criminal sanctions. This makes it essential to rely on your accountant, who is not only well-versed in the…

05 January - Monthly Pay-As-You-Earn (PAYE) submissions and payments 24 January – End of Filing Season for Provisional taxpayers 24 January – End of Trusts Filing Season for taxpayers liable for provisional tax 30 January - Excise Duty payments 31 January - Value-Added Tax (VAT) electronic submissions and payments & CIT Provisional payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“Think of giving not as a duty but as a privilege.” (John D. Rockefeller Jr.) Most businesses want to show appreciation to their employees at the end of a long year’s work, and the “Season of Giving” is the ideal time. A thoughtful gift will make any employee feel more recognised and appreciated, and this will improve morale and enhance perceptions about the company and could even increase employee satisfaction and loyalty. SARS, however, considers almost any kind of gift to employees as a taxable fringe benefit, and therefore companies need to check with their accountants before giving, to ensure the tax implications are fully understood and taken into consideration. What does SARS regard as gifts? Any asset, commodity, goods or property of any nature provided by the employer to the employee at no cost, or a cost which is less than the market value of that item, is regarded as a taxable benefit in the hands of the employee, as per Paragraph 2(a) of the Seventh Schedule to the Income Tax Act. This means that any gift that can be regarded as an asset will be subject to employees’ tax – whether physical or intangible, and regardless of the value, because there is also no minimum value below which gifts from an employer are exempt from tax. Furthermore, the gift will be taxable even if the gift is given to an employee’s family member, such as a partner or a child. Also remember that the onus of proof lies with your company should SARS challenge the tax treatment of any gifts to your employees. Tax on common employee gifts Tangible gifts, such as watches or electronic devices, will be taxed in the hands of the employee based on its market value, or on the cost to the employer. Intangible gifts such as flights, bus tickets or accommodation are also considered as taxable benefits to the employee and the cost to the employer is the taxable amount. Gift cards and vouchers are among the most popular gifts for employees, but beware!  These are taxed at the same rate as if it the employee received cash. In some cases, it may be better to gift cash instead of a card or voucher that would limit the employee to a single retailer or outlet. Similarly, bonusses are taxed at the same rate as other remuneration. This means that the amount of the bonus will be added to an employee’s annual salary when the rate of tax payable for the year is determined. The danger here is that the bonus amount might push some employees into a higher tax bracket. How must the tax be deducted? Depending on the nature of the gift, employers will need to determine the cash equivalent, or the market value, or the cost to the company to calculate the employee tax that must be deducted. This can be quite complex, for example, the value of a benefit where accommodation is provided depends on whether the company owns the…

7 December – Monthly Pay-As-You-Earn (PAYE) submissions and payments 28 December – Excise Duty payments 29 December - End of 3rd Financial Quarter 29 December – Value-Added Tax (VAT) electronic submissions and payments & CIT Provisional payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“…imposing administrative non-compliance penalties is to ensure the widest possible compliance with the provisions of a Tax Act … they are imposed impartially, consistently and proportionately to the seriousness and duration of the non-compliance.” (SARS) The Tax Administration Act stipulates that SARS can issue administrative penalties for outstanding tax returns. In previous years, penalties were only imposed on taxpayers with more than one tax return outstanding. Since December, due to changes in the Tax Administration Act, SARS can apply administrative penalties to taxpayers who have a single outstanding return. As a result, hundreds of thousands of South African taxpayers have received administrative penalties from SARS this year, many of them facing tax debt of tens of thousands of rands, accumulated over many years. When are penalties incurred? SARS can raise administrative penalties if a taxpayer is non-compliant in a specific area of their tax affairs, including Personal Income Tax (PIT) and Corporate Income Tax (CIT), Pay as You Earn (PAYE) or value-added tax (VAT). A percentage-based penalty is imposed when a payment is received late. To prevent a payment from being received late, the payment must be received into the SARS bank account on or before the due date. SARS also imposes fixed amount administrative non-compliance penalties for outstanding returns and/or non-compliance for PIT or CIT. These include the once off PIT penalty imposed where the taxpayer submitted a return late as from 2020 year of assessment onwards. There is also a recurring penalty for the failure to submit a return for PIT and CIT. The fixed amount penalty is based on a taxpayer’s taxable income and can range from R250 a month (where there is an assessed loss or no taxable income) up to R16,000 a month (where the taxable income exceeds R50 million) for each month that the non-compliance continues. For PIT, the recurring penalty is imposed where the taxpayer failed to submit an income tax return for years of assessment from 2007 onwards, when that person has one or more income tax returns outstanding. For CIT, the recurring penalty is imposed where the company has failed to submit an income tax return for years of assessment from 2009, where SARS has issued the company with a final demand and the company failed to submit the return within 21 business days of the final demand. As such, penalties are now applied monthly for tax returns dating back many years. Companies also face administrative penalties for PAYE. If an employer has failed to submit an EMP501 reconciliation declaration on time, an admin penalty of 1% per month over 10 months, based on the employer’s liability over 12 months, is levied. What are the costs of the penalties? Percentage-based penalties are often steep, such as the 10% late payment penalty on VAT or PAYE, or the penalty of 1% over 10 months where an EMP501 was not submitted in time. But it is the recurring penalties levied every month that really snowball. This is because SARS will keep penalising non-compliant taxpayers month…

“The importance of the ability of taxpayers to challenge the legality of actions and decisions within the tax system is internationally recognised.” (Taxpayers’ Rights: Theory, Origin and Implementation) In South Africa, taxpayers have the right to dispute tax assessments, interest, late payment penalties, and administrative penalties for various taxes, including Personal Income Tax (PIT), Corporate Income Tax (CIT), Value-Added Tax (VAT), and Pay-As-You-Earn (PAYE). This is done by submitting requests such as Request for Reason, Request for Late Submission (Condonation), Request for Remission (RFR), Notice of Objection (NOO), Notice of Appeal (NOA), and Suspension of Payment. Recent changes to the procedures to lodge an objection and appeal against an assessment or decision aim to enhance the efficiency and effectiveness of tax dispute resolution. Here are the key changes: Taxpayers now have 80 business days to file a Notice of Objection against a SARS assessment or decision, a significant increase from the previous 30-day window. Taxpayers are not obliged to wait the full 80-day period. All substantiating documentation must now be submitted within the extended 80-day objection period, making it crucial to request reasons for an assessment before objecting. Previously taxpayers were only required to list the substantiating documents.  Taxpayers can request an additional 30-day extension beyond the 80-day period for valid reasons and, in exceptional cases, an extension up to three years. Taxpayers and SARS can agree on shorter periods for dispute resolution, not just extensions as per the old rules. Taxpayers can appeal the outcome of an objection on new grounds not raised in the NOO, if it doesn't pertain to a previously unchallenged part of the assessment. Alternative Dispute Resolution (ADR) changes now require facilitators to have appropriate tax experience and to be acceptable to both parties. A senior SARS official must appoint the facilitator within 15 days of the ADR commencement. Interim ADR reports must be delivered within five days after the meeting, and final reports within 10 days following the end of ADR proceedings. SARS must now issue assessments within 45 days of a settlement being reached in a dispute and/or after receipt of the Tax Court’s decision from the Registrar. SARS must provide a statement explaining why they made an assessment and why they oppose an appeal to the tax court. SARS can now add new grounds for disallowing objections or appeals, unless it changes the assessment basis significantly or requires a new assessment. Changes to the Tax Board and Tax Court processes include the issuance of subpoenas by the Tax Board clerk or Tax Court registrar, with parties having the right to challenge these if they find them irrelevant or unreasonable. An email address is now expressly included as an ‘address for delivery’. What’s still the same? SARS must inform taxpayers of assessments, notifications or communications issued by also sending a message to the taxpayer’s last known number or email. Keep your contact details updated and check your compliance status regularly, especially when receiving emails or SMSs from SARS.               Submitting an objection or appeal does not…

7 November – Monthly Pay-As-You-Earn (PAYE) submissions and payments 29 November – Excise Duty payments 30 November – Value-Added Tax (VAT) electronic submissions and payments & CIT Provisional payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

6 October - Monthly Pay-As-You-Earn (PAYE) submissions and payments 30 October - Excise Duty payments 31 October - Value-Added Tax (VAT) electronic submissions and payments & CIT Provisional payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“The difference between tax avoidance and tax evasion is the thickness of a prison wall.” (Denis Healey, former British prime minister)     Section 234 in Chapter 17 of the Tax Administration Act (TAA) sets out a list of criminal tax offences. If prosecuted and convicted of a tax criminal offence, taxpayers will - at the least - be subjected to a substantial fine and may even face the maximum penalty of imprisonment for up to two years. There are also other harsh consequences of a criminal conviction under section 234, such as a negative impact on the eligibility of individuals to hold certain positions and to emigrate from South Africa, as well as reputational damage and a loss of both shareholder value and stakeholder trust for corporate taxpayers. These tax criminal offences range from serious offences, such as intentional tax evasion and frustrating SARS in carrying out its duties, to relatively minor breaches, such as failing to notify SARS of a change in registered particulars. Common tax criminal offences Not registering for tax purposes to evade paying taxes due. Not submitting returns to SARS as and when required to evade paying taxes. Not truthfully responding to SARS’ questions. Not declaring income to evade paying tax on that income. Lying about expenses, like business mileage or medical contributions, to reduce tax payable or obtain an undue refund. Submitting fraudulent invoices to reduce Income Tax and VAT payable or obtain fraudulent refunds. Employers deducting tax from employees (PAYE) and never paying it over to SARS. Vendors, whether registered for VAT or not, charging VAT and never paying it over to SARS. Not notifying SARS of a change in registered particulars. Not retaining records as required under the TAA. Issuing an erroneous, incomplete or false document required to be issued under a tax Act. Neglecting to disclose to SARS any material facts which should have been disclosed. Obstructing SARS officials in doing their duties. How SARS views taxpayer behaviour While taxpayers were previously merely penalised for human errors and simple mistakes - which are common given the complex tax processes and strict deadlines - a taxpayer can now be found guilty of an offence without SARS having to show that the taxpayer wilfully, deliberately and knowingly committed the offence. This means even inadvertent or administrative errors can be penalised with a maximum penalty and that a substantially expanded range of taxpayer behaviours - and a greater number of taxpayers - are now open to criminal sanctions. How to avoid committing tax criminal offences SARS notes that among the steps that a reasonable person may take to avoid committing tax criminal offences is “employing an accountant, tax practitioner, or other tax professional to complete returns, or from whom to obtain advice before completing a return with entries that are not understood or adopting a position with tax implications.” Be sure to choose a specialist who is appropriately qualified and experienced, as well as a member of a professional controlling body that enforces strict standards, such as SAICA…

"Any taxpayer can be selected by SARS for verification for the purpose of proper administration of tax, including on a risk basis." (SARS) Companies must, within 12 months of their financial year-end, submit to SARS an Income Tax Return for Companies (ITR14), as well as supporting documents, declaring their full income tax responsibility to SARS. This declaration, return and supporting documents may be selected for verification by SARS. A verification involves the comparison of the information declared on the return to the taxpayer’s financial and accounting records and other supporting documents. The purpose of a verification is to ensure that a declaration or return represents a taxpayer’s tax position fairly and accurately. Previously, when companies were identified for a verification, SARS required them to submit the Supplementary Declaration for Companies or Close Corporations or IT14SD form. This is no longer required by SARS, but it will increase the scrutiny companies face when selected for verification. What has changed? The requirement to submit an IT14SD in a verification case is replaced by a letter requesting specific relevant documents based on the reason for verification. SARS also says that as of September last year, companies are no longer required to submit any outstanding IT14SDs and that should taxpayers receive any further notification or final demand letter to submit an IT14SD, such request should be ignored. However, taxpayers should always check with their accountant before disregarding correspondence of any kind from SARS. What’s still the same? The requirement to submit relevant documents upon submission of the ITR14. All correspondence will still be issued as before. The process of dealing with the verification case will remain the same. The submission of specific relevant documents will be required during the verification process. The verification of a company always requires the submission of a signed set of Annual Financial Statements (AFS), as well as a detailed Tax Computation and the underlying supporting documentation/schedules (e.g. Tax pack). When requested to submit specific relevant documents based on the reason for the verification, companies are still required to submit the documents within 21 working days. How does this affect your company? When a company is now identified for verification, it will be notified of the verification, as is the current practice and will be requested to: Submit specific relevant documents based on the reason for the verification, or Submit a revised Corporate Income Tax ITR14 return. To comply with a request to submit specific relevant documents, the requested documents must be uploaded using eFiling, or any other submission channel, including SARS Online Query system (SOQS). Once the relevant documents are uploaded, a SARS verifier will be able to action the case. If the relevant documents are deemed insufficient, or additional documents are required, this will be requested. The relevant documents must still be provided within 21 working days. If a company does not comply with the request for relevant documents, SARS will raise a revised assessment to resolve the verification case, and will add back the related expenses, dependent on the specific relevant…

7 September - Monthly Pay-As-You-Earn (PAYE) submissions and payments 28 September - Excise Duty payments 29 September – End of the 2nd Financial Quarter, Value-Added Tax (VAT) electronic submissions and payments, CIT Provisional payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“The submission of accurate personal income tax returns on time is important for a seamless filing season. Taxpayers must take control of their own tax affairs to ensure they are aware of their obligations and remain compliant.” (SARS Commissioner Edward Kieswetter) SARS recently announced the dates and changes for the 2023 Tax Season, which opened on 7 July 2023 for individuals (non-provisional taxpayers and provisional taxpayers), as well as for trusts. The deadline dates are as follows: Non-provisional taxpayers who were auto assessed have until the normal filing season deadline, 23 October 2023, to file an amended return. Individuals who were auto assessed will receive an SMS or email from SARS. Non-provisional taxpayers who are required to file a return and did not receive a notification from SARS that they were auto assessed must submit a Personal Income Tax Return (ITR12) before 23 October 2023. Provisional taxpayers as well as trusts can file a return until 23 January 2024. What’s still the same? Much stays the same as last year, including that SARS will again issue auto assessments to taxpayers whose tax affairs are less complicated, usually non-provisional taxpayers who are formally employed. SARS will send an SMS and/or email to inform taxpayers of the auto assessment, which can be viewed on eFiling or the SARS MobiApp. The auto assessments are based on the data SARS collects from employers, financial institutions, medical schemes, retirement annuity fund administrators and other third-party data providers. If you agree with your auto-assessment - and have confirmed with your accountant that everything is in order - you are not required to file a tax return and you do not need to do anything further. Where your assessment shows that you owe tax to SARS, payment must be made on or before the payment due date displayed on the “Notice of Assessment” (ITA34). If a refund is due, simply wait for the refund, which can be expected within approximately seventy-two (72) hours if your banking details with SARS are correct. If you are not in agreement with the auto-assessment, you can edit the declaration by completing and filing a tax return, along with the necessary supporting documents, before 23 October 2023, to enable SARS to consider a revised assessment. What’s new this year? Extended auto assessment deadline - this year SARS will allow taxpayers, who did not agree with the auto assessment outcome, to file an amended return until the normal filing season deadline, 23 October 2023. This is a change from the 40 days allowed last year. Where an auto-assessment is issued after 23 October 2023, the 40 business days will start on the date of the notice of the assessment The payment due datesfor non-provisional eFilers will be adjusted to: 30 days after a notice of assessment has been issued for taxpayers who have not been auto-assessment; or 30 days post Filing Season 2023 closing date for auto-assessed taxpayers. Spouses married in community of property assessment - this filing season SARS has retrieved “Married in community of…

7 August - Monthly Pay-As-You-Earn (PAYE) submissions and payments 30 August - Excise Duty payments 31 August - Value-Added Tax (VAT) electronic submissions and payments, CIT Provisional payments where applicable, first provisional tax payment (individuals). Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

"Confidentiality of taxpayer information has always been a fundamental cornerstone of tax systems… taxpayers need to have confidence that the often-sensitive financial information is not disclosed inappropriately, whether intentionally or by accident." (Organisation for Economic Co-operation and Development - OECD) The confidentiality of taxpayers’ information has recently come under the spotlight in South Africa. This was first sparked by a public statement from SARS earlier this year on the tax compliance status of President Cyril Ramaphosa and two related entities. “In taking this exceptional step to disclose the tax status of the President, with his written consent, SARS would also encourage other high profile political office bearers and leaders in society to consider taking this proactive step as part of their commitment to transparency,” SARS Commissioner, Edward Kieswetter, said at the time. This was followed by a recent Constitutional Court ruling concerning tax confidentiality and the right of access to information, relating to a request under the Promotion of Access to Information Act (PAIA) to access certain tax records of former President Jacob Zuma (Arena Holdings and others v SARS and another). The court found that certain provisions of PAIA, as well as the Tax Administration Act (TAA), are constitutionally invalid, and ordered SARS to reconsider the request to disclose taxpayer information, taking into account certain issues. While this re-evaluates the previous absolute confidentiality of tax records – and affects every taxpayer in South Africa - SARS says that the judgment does not set aside the tax confidentiality provisions for the information it collects. What information can SARS collect? SARS has access to a wide array of sensitive information about both businesses and individuals, and it has long been accepted that the confidentiality of this information is paramount. Taxpayer information is defined in the TAA as any information provided by a taxpayer or obtained by SARS in respect of the taxpayer, including biometric information. SARS draws on available data from statutory declarations by taxpayers, data from third party providers as well as other sources. In addition, not providing sensitive financial - and even extremely personal - information to SARS is not an option. According to the TAA, it is a criminal offence for a person to wilfully and without just cause refuse or neglect to: furnish, produce or make available any information, document or thing, excluding information requested under section 46(8) reply to or answer truthfully and fully any questions put to the person by a SARS official take an oath or make a solemn declaration or attend and give evidence as and when required in terms of the Act. Furthermore, taxpayers are legally obliged to disclose the information required to discharge the burden of proof, and to ensure access for SARS to certain records at all times. By not complying with these provisions, a taxpayer is guilty of an offence and, upon conviction, is subject to a fine or to imprisonment for a period not exceeding two years. What about POPIA and PAIA? The Protection of Personal Information Act (POPIA)…

7 July - Monthly Pay-As-You-Earn (PAYE) submissions and payments 28 July - Excise Duty payments 31 July - Value-Added Tax (VAT) electronic submissions and payments & CIT Provisional payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“The government expects that, by encouraging companies to undertake R&D in South Africa, local companies will strengthen their capabilities of developing value-added products, technologies and services.” (Department of Science and Innovation (DSI) - South Africa) Research and development (R&D) is essential to boost innovation in the business sector, as it improves the capability to develop new products and processes and to improve existing ones. This is crucial for improving competitiveness and growth of the South African economy. Section 11D of the Income Tax Act offers a R&D tax incentive to promote private sector R&D investment in South Africa. In the following paragraphs, you will find out what the incentive offers, which companies qualify, and the terms and conditions that apply. What does the R&D incentive offer businesses? Section 11D allows R&D spending to be considered when determining taxable income in two ways: A deduction equal to 150% of expenditure incurred directly for R&D; and An accelerated depreciation deduction (50:30:20) for capital expenditure on machinery or plant used for R&D. According to the DSI, the tax deduction will help to reduce the cost of R&D, which will enable companies to finance their R&D and scale up or undertake R&D activities sooner than otherwise. Which companies can benefit from the R&D incentive? To be eligible, a company must be an incorporated entity and recognised as a company under the Income Tax Act. Individuals, non-profit organisations and trusts are not eligible. As the aim is to encourage South African companies to invest in R&D, the incentive is available to businesses of all sizes and in all economic sectors. Companies can also claim a deduction of R&D it outsources to another company, or to a South African university or science council. Companies in joint ventures (JVs) can claim to the extent that they fund the R&D. Prototypes and pilot plants created solely for purposes of R&D are also eligible. However, where a company receives funding from government, a public entity or a municipality towards its R&D activities, this funding will be excluded when the R&D tax deduction is calculated. What are the terms and conditions? The R&D activities must be approved by the Minister of Science and Innovation on recommendation by the R&D Tax Incentive Adjudication and Monitoring Committee that evaluates applications and reviews the annual progress reports that must be submitted. The R&D expenditure claimed should be incurred directly and solely for R&D undertaken in South Africa, and in the production of income and the carrying on of any trade. R&D expenditure claimed should be incurred after the date the application is submitted to the DSI. Applications awaiting approval should not be included in provisional tax calculations to avoid penalties. Where approval is received after a tax assessment has been finalised, a Request for Correction can be made. There is an extensive list of exclusions and limitations. Since last year, applications and progress reports can only be submitted via the new online automated system. According to the 2023 Budget Review, government is refining…

7 June - Monthly Pay-As-You-Earn (PAYE) submissions and payments 29 June - Excise Duty payments 30 June – End of the 1st Financial Quarter 30 June - Value-Added Tax (VAT) electronic submissions and payments & CIT Provisional payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“The lack of reliable electricity supply is the biggest economic constraint… I am pleased to announce two tax measures to encourage businesses and individuals to invest in renewable energy and increase electricity generation.”(Finance Minister Enoch Godongwana – Budget 2023) In the 2023 Budget, the lack of a reliable electricity supply was highlighted as the country’s biggest economic constraint. South Africans have been subjected to loadshedding every day of 2023, often at stage four, five or six. Recent research by the Bureau for Economic Research revealed more load-shedding in the first two months of 2023 than in all of the previous four years. It is a situation expected to deteriorate even further as demand rises with the winter months approaching. To encourage businesses and individuals to invest in renewable energy and to increase electricity generation, government announced two tax measures in the 2023 Budget in February. The first will provide R5 billion in tax relief to companies through an expansion of the renewable energy incentive, and the second will provide R4 billion in tax relief for households that install solar panels. Both entail a number of conditions and requirements, as well as tight timelines, which are summarised below. The expanded tax incentive for businesses To encourage rapid private investment to alleviate the energy crisis, this is a temporary expansion of the existing tax incentive Section 12B of the Income Tax Act, which provides for capital expenditure deductions for assets used in the production of renewable energy. It originally allowed businesses to deduct 50% of the costs in the first year, 30% in the second and 20% in the third for qualifying investments in wind, concentrated solar, hydropower below 30 megawatts (MW), biomass and photovoltaic (PV) projects above 1 MW, and provided an accelerated capital allowance of 100% in the first year for solar PV energy projects of less than 1MW. This incentive has now been temporarily expanded as outlined below. Highlights of the expanded incentive Under the expanded incentive, businesses will be able to claim a 125% deduction. Moreover, that deduction can now all be claimed in the first year. Businesses will be able to reduce their taxable income by 125% of the cost of renewable energy assets used for electricity generation. The adjusted incentive will only be available for investments brought into use for the first time between 1 March 2023 and 28 February 2025. The deduction applies to all renewable energy projects. There will be no thresholds on the generation capacity size of the projects that qualify. The expanded incentive is only available for two years from 1 March 2023 to 28 February 2025 to stimulate investment in the short term. Example: business renewable energy tax incentive For businesses with a positive taxable income, the deduction will reduce tax liability. For example, a renewable energy investment of R1 million would qualify for a deduction of R1.25 million against taxable income. Using the current corporate tax rate (27%), this deduction could reduce the corporate income tax liability of a company by…

“In 2022 South Africa had the 12th highest income tax burden, the 9th highest company income tax burden, and the 14th highest non-resource tax burden worldwide.” (Garth Zietsman, South Africa's Tax Freedom Day statistician)  Tax Freedom Day marks the day in the year when South Africans stop giving all their money to their government for the year and finally start working for themselves. In 2023, Free Market Foundation statistician Garth Zietsman has worked out that this day will be the 14th of May, two days later than in 2022, which in turn fell 10 days later than predicted in 2021. In 2023, the average South African taxpayer has had to work for a predicted 133 days to pay their taxes. Back in 1994, South Africans took 101 days. The usefulness of the metric is now clear – South Africans are now spending a full month longer every single year working for their government. According to Zietsman, the actual date may be far worse: “The prediction is based on the intended level of tax collection for central government mentioned in the Budget Speech. Typically, the actual figure, which is the general government revenue as a percentage of GDP from the Reserve Bank Quarterly, turns out to be 30% more than the intended figure for central government”. The Freemarket Foundation is a Johannesburg based, classical liberal think tank, who have adapted the concept of Tax Freedom Day from Florida businessman Dallas Hostetler who developed and trademarked the idea in America in 1948. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

5 May - Monthly Pay-As-You-Earn (PAYE) submissions and payments 30 May - Excise Duty payments 31 May - Value-Added Tax (VAT) electronic submissions and payments & CIT Provisional payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

1 April – Start of the 2022/23 Financial Year 6 April - Monthly Pay-As-You-Earn (PAYE) submissions and payments 26 April - Excise Duty payments 28 April - Value-Added Tax (VAT) electronic submissions and payments & CIT Provisional payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

The big Budget Speech 2023 tax news was the introduction of tax incentives for investing in rooftop solar and renewable energy. The Budget also detailed tax relief in the form of adjusted tables for tax and rebates for individual taxpayers, adjusted tables for retirement tax and transfer duty, and the expected increases in ‘sin’ taxes. How will these changes affect you directly? To better understand the impact of the Budget on you and your business, here is a selection of official SARS Tax Tables, then follow the link to Fin 24’s Budget Calculator to do your own calculation. Businesses – corporate tax rates unchanged* Source: SARS’ Budget Tax Guide 2023 Individual taxpayers – tax tables adjusted Source: SARS Source: SARS Source: SARS Transfer duty table - adjusted  Source: Budget 2023 People’s Guide Sin taxes raised Source: Budget 2023 People’s Guide How much will you be paying in income, petrol and sin taxes? Use Fin 24’s four-step Budget Calculator here to find out the monthly and annual impact on your  income tax, as well as what you will pay in future in terms of fuel and sin taxes, bearing in mind that the best way to fully understand the impact of the announcements in Budget 2023 on your own and your business affairs is to reach out for professional advice from your accountant. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

7 March - Monthly Pay-As-You-Earn (PAYE) submissions and payments  30 March - Excise Duty payments  31 March – End of the 2022/23 Financial Year  31 March - Value-Added Tax (VAT) electronic submissions and payments & CIT Provisional payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“Without a logbook, you will not be able to claim a travel deduction.” (SARS Travel Logbook 2022/23) Even while recovering from the economic impact of COVID and facing the challenges of power blackouts, businesses and their employees are also contending with the costs of travel that have reached historic highs. Thankfully, expenses related to business travel can be deducted from taxable income – reducing the tax liability for taxpayers, including businesses, employees, commission-earners and independent contractors. All these taxpayers should prioritise maximising the available tax deductions by ensuring they can claim for every actual business travel-related expense. This is increasingly important given the rapidly rising costs of travel, fuel and vehicle ownership. Fuel prices have more than doubled over the last five years and continue to set new records. In addition, Wesbank recently reported that the monthly cost of vehicle ownership for an average entry-level vehicle is 33% higher than five years ago and has increased 32% between November 2021 and November 2022. To claim any business travel expenses, it is compulsory to keep an accurate and up-to-date SARS-compliant logbook for each vehicle. In addition, there are other tax implications related to travel expenses, travel allowances and travel reimbursements, some of which are briefly highlighted below. Claiming the business travel deduction – fast facts Businesses can claim business travel expenses incurred in the production of income. Employees who receive a travel allowance can claim a deduction for the use of their private vehicles for business purposes. Employees may also be entitled to claim a reduction on the fringe benefit in respect of business kilometres travelled in a company car. To claim any travel deduction, an accurate, up-to-date logbook detailing all business kilometres travelled is required. SARS accepts electronic logbooks. There is no deduction allowed for private travel, which is any travel not for business purposes, such as travelling between home and work. In addition to a logbook, taxpayers who want to claim actual travel expenses should keep accurate records and proof of all travel expenses, such as fuel and maintenance, incurred during the year. A separate logbook and records must be kept for each vehicle used for business purposes. SARS reserves the right to query and audit the content or information recorded in any logbook by the taxpayer. Logbooks and other records must be kept for at least five years as taxpayers may be required to submit them to SARS for verification of travel claims. How to claim a business travel tax deduction Record the vehicle’s odometer reading on the first day of a tax year (1 March for individuals and also for companies). Maintain the logbook all year – SARS requires the following minimum information for every single business trip: date of travel; kilometres travelled; and travel details including where the trip started, the destination and the reason for the trip. It is not necessary to record details of private travel. Keep records of all related travel expenses such as fuel, oil, repairs and maintenance, car licence, insurance, vehicle…

"People who complain about taxes can be divided into two classes: men and women." (Unknown) The assessed loss rules have always allowed companies to deduct from their taxable income each year any assessed losses from previous years. The remaining assessed loss balances could be carried forward indefinitely. This meant that a company would only pay income tax once it made a taxable profit and all previous assessed losses had been deducted from the taxable income. These rules have changed and may affect your next income tax bill. What’s new? Under the new rules, assessed losses brought forward from a previous year of assessment can only be offset against a maximum of 80% of the current year’s taxable income or R1 million, whichever is higher. This means that many companies will now pay income tax on up to 20% of the taxable income for the year if it exceeds R1 million, even if the assessed loss balance carried forward from previous years far exceeds the taxable income. Adjust your cash flow forecasts accordingly.  What you should know The new rules apply to any year of assessment that began on 1 April 2022 onwards and that ends on or after 31 March 2023. The new limitation applies to a company’s assessed loss balance as at 1 April 2022, and not only to assessed losses accumulated after this date. Companies do not lose the balance of an assessed loss that could not be utilised in one tax year, it is just carried forward to the next tax year. If a company does not trade for a full year of assessment and no income is earned from such trade, the assessed loss balance will be lost. Further complex rules may apply in certain circumstances, for example, the 3-out-of-5-years rule and the ring-fencing of losses if a business carries on one of the listed “suspect trades”, which means professional advice is essential when deducting an assessed loss against taxable income. Will your tax bill be affected? Some companies will not be affected immediately, for example: Companies that made a loss during the year and therefore have no taxable income to reduce; Companies that do not have an assessed loss balance brought forward; and Smaller companies with a taxable income below R1 million are not affected by the new rules and can still deduct the full balance of an assessed loss against 100% of their taxable income.  However, the changes will have tax cash flow implications for other companies. The examples below illustrate this. Both the old and the new rules are complex. In addition, some of the wording in the legislation still needs to be clarified, so speak to your accountant about the impact the new rules will have on your next tax bill. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific…

7 February - Monthly Pay-As-You-Earn (PAYE) submissions and payments 27 February - Excise Duty payments 28 February - Value-Added Tax (VAT) electronic submissions and payments & CIT Provisional payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“Being tax compliant… is not just good for you, but also contributes to the positive growth of our country’s economy which in turn benefits all South Africans.” (SARS) Businesses are often required to provide, confirm or share tax clearance information to another entity. This is because proof of tax compliance is an indicator of a company’s good standing in terms of its legal obligations and how well it is managed. There may be instances when an individual, another company, or a government entity needs to verify your tax compliance status, for example, during a prequalification as a supplier; for a tender application or bidding process; to confirm good standing and that your tax matters are in order with SARS; or for foreign investment allowances.   Tax clearance information is no longer confirmed via Tax Clearance Certificates – these have been replaced by SARS’ Tax Compliance Status (TCS) system, which verifies your tax status online and in real-time, and makes it very important to ensure you and your company are always compliant. How it works now Instead of a manual tax certificate being issued as in the past, SARS’ new system allows individuals and businesses to obtain a TCS PIN (personal identification number). Your accountant will be able to assist with the process of applying to SARS to obtain this PIN through eFiling which requires, for example, activating the TCS for the business or individual, merging all the tax types into one registered profile, completing the Tax Compliance Status Request and selecting the correct type of TCS: good standing, tender, or – for individuals only - emigration and foreign investment allowance.  If all your tax affairs are in order, your PIN should be issued immediately via SMS or email. A unique PIN is issued for each TCS request submitted to SARS. This PIN, along with your tax reference number is then sent to the third-party that requires confirmation of your or the company’s tax compliance status. To verify tax compliance status, the third-party will go to eFiling and submit your tax reference number and PIN under “New Verification Request.” Your current tax compliance status will appear and will be colour-coded, indicating if your tax affairs are currently in order or not:  - green indicates that all tax affairs are in order and the taxpayer is tax compliant;  - red means the taxpayer is not tax compliant. Click here to see full size screenshotSource: SARS It is important to note that the PIN is valid for a year and will reflect the current tax status at the date and time the PIN is entered into the TCS system (not the compliance status at the time the PIN was issued). This means your tax compliance status on the system can change during the year in line with your tax behaviour, which might include, for example, an inadvertent late submission or missed payment. For this reason, it is crucial to continuously monitor your tax compliance status to ensure a non-compliant tax status does not impact business and other opportunities.…

6 January - Monthly Pay-As-You-Earn (PAYE) submissions and payments 30 January - Excise Duty payments 31 January - Value-Added Tax (VAT) electronic submissions and payments & CIT Provisional payments where applicable. Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

7 December Monthly Pay-As-You-Earn (PAYE) submissions and payments 23 December Value-Added Tax (VAT) manual submissions and payments 29 December Excise Duty payments 30 December End of the 3rd Financial Quarter 30 December Value-Added Tax (VAT) electronic submissions and payments & CIT Provisional payments where applicable Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice. © CA(SA)DotNews

“[Taxpayers] should give at least the same priority to tax obligations as their other responsibilities.” (SARS’ Short Guide to the Tax Administration Act) SARS has wide powers when it comes to the collection of tax debts and just one of these is the power to collect money owed by taxpayers from third parties who hold money for those taxpayers, such as a bank. This means that SARS can indeed take outstanding tax amounts from a personal or business bank account without your consent, by instructing the bank to pay the amount outstanding over to SARS through a process called Third Party Appointment (TPA). The same instruction can be issued by SARS to other third parties that hold money on behalf of a taxpayer, such as an employer, a customer, an insurance company, or an attorney.  Given the  significant negative implications this could have for a taxpayer, whether an individual or a company, there are certain procedures SARS must follow before it can collect tax debt via a third party appointment or another collection method, and individual and business taxpayers are well advised to understand how a tax debt can arise without their knowledge, and how to prevent SARS from collecting such tax debt from their bank accounts without their consent.   What is a tax debt?  While filing correct returns and making payments on time will protect taxpayers from tax debts, penalties and interest, taxpayers may not be able to meet these requirements on time for a range of reasons.  As such, administrative penalties on late or non-submission of tax returns, failure to submit tax returns, the submission of returns without payment, or partial payment of a tax liability can all result in a tax debt, which can also arise from a SARS assessment, or from an audit. How can a tax debt be collected?  SARS’ powers to collect tax debt are extensive, and include:  Recovering tax debt through third parties who hold money on taxpayers’ behalf, such as banks, employers, customers, insurance companies or attorneys. If such a third party fails to adhere to the appointment, the third party can be held personally liable to SARS and may be convicted of a criminal offence.Issuing a judgement and having a taxpayer blacklisted. Obtaining a preservation order in respect of taxpayer assets. Attaching and selling taxpayer assets.Bringing sequestration or liquidation proceedings against a taxpayer.Holding directors, members or related parties liable for the company’s tax debt. When can SARS collect tax debt?  If you cannot pay a tax debt to SARS and do not follow the correct procedures, SARS is legally allowed to exercise its powers of collection as detailed above, even if you are disputing the debt!  Fortunately, SARS must also follow the correct procedures. These include that the taxpayer must have received an assessment from SARS detailing how much is due and by when, as well as a final demand for payment that states available debt relief mechanisms contained in the Tax Administration Act (TAA); and recovery steps that SARS may take if…

7 November – Monthly PAYE submissions and payments25 November - VAT manual submissions and payments29 November - Excise Duty payments30 November - Value-Added Tax (VAT) electronic submissions and payments & CIT Provisional payments.