Changing more than your hold

The distinction between amounts received of a capital nature as opposed to a revenue (or income) nature is essential for income tax purposes. Non-capital amounts received, such as from the disposal of trading stock, are subject to tax at a higher effective rate compared to capital profits. The primary intention with which an asset is […]

Shareholding in SA companies: Beware of residency changes

In 2001, South Africa, like many other countries, introduced capital gains tax aimed at levying capital gains tax on the gain made from the disposal of certain assets. When a South African tax resident company redomiciles abroad and changes its tax residency to another tax jurisdiction, such a company ceases to be a tax resident for South African income tax purposes (regardless of whether […]

When is Capital Gains Tax not incurred?

Section 9HA of the Income Tax Act deals with deemed disposals by a deceased person. This section of the Act often causes some confusion, especially where there are heirs or legatees other than the surviving spouse. In terms of the provision, a deceased person is treated as having disposed of his or her assets at the date of death, for an amount received or accrued equal to […]

Helpful tax resources

South African taxes are inherently complex and often involve interpretation, consulting and in exceptional cases, a fair amount of educated guessing on exactly what the legislature intended when the various acts were drafted. However, in order to assist taxpayers through the maze of information, there are some very helpful aids available to taxpayers and tax […]

Special trusts

The Income Tax Act[1] includes specific provisions for “special trusts”. These trusts are taxed on the same sliding scale applicable to natural persons, which could be lower than the current 45% flat rate applicable to conventional trusts. Capital gains tax (“CGT”) is also lower within a special trust, at a maximum rate of 18% compared […]

Have you ever done your estate planning?

If you have never planned your estate, perhaps now is a good time to consider it. This will be to everyone’s benefit, as there are often hidden costs which come into effect at the time of passing, that are not taken into account when you plan your estate and inheritance. These expenses include the following: […]