The High Court ruling that some 700
criminal charges against Jacob Zuma are to be reinstated had
little impact on the SA/$ exchange rate. However, the victory of
Donald Trump in the Republican Party Presidential nomination race
appears to have had the effect of weakening our currency. One
hopes that further developments in the United States will not add
to our economic woes as described below.
Duty – one calendar month to the day after the incorporation
of Access to Information Act manual – 31
December 2021 extended
of EMP501 Reconciliation of PAYE payments and issue of tax
Certificates (IRP & IT3(a)) for 2016 due by 31 May 2016
Voluntary Disclosure Programme – 1 October 2016 to 31 March 2017
Tax clients should note that unless we receive all
the relevant data and documentation at least fourteen days before
the applicable submission deadline we cannot be held responsible
for any punitive action taken against them by SARS.
If you have several workbooks open, there is a
keyboard shortcut to select the one that you wish to activate it.
By pressing Alt W W, the Switch Window list is displayed on the
View tab. You may then, by using the arrow keys, move to the
workbook required and press enter. Alternatively, simply press the
number in the list that refers to the listed item that you
Annual income tax returns
More and more emphasis is being placed by SARS upon
the timely lodgement
of returns. Filing season for annual tax returns usually starts
during July and from that point onwards tax practitioners are
under extreme pressure to meet the deadlines set by SARS. The late
submission, to us, of a client’s data may aggravate that
pressure and impact upon the achievement of those targets.
It is for this reason that
we advocate the early preparation of a file containing the
documentation that we will require to prepare your return.
Financial institutions and medical aid societies are set the same
deadline dates for preparation of tax certificates as are set for
employers for the preparation of IT3(a) and IRP5 certificates.
Therefore, all certificates required from these entities for the
preparation of your tax return should be received by you no later
than 31 May 2016.
If these have not been
received by the middle of June, we suggest that you follow up the
matter with the relevant body.
Clients with revenue from
sources other than employment, pensions, retirement annuities and
investments should have already started accumulating data
supporting the preparation of an income statement relative to that
activity. Apart from trading activities, the most common source is
In that regard, the
documents should include:
Estate agents collection statements, if
Levy and rates statements
Invoices in respect of any repairs or
maintenance carried out during the tax year
Invoices covering advertising costs. Where a
property has not been let throughout the year, it is necessary to
be able to prove that every effort has been made to remedy this in
order to avoid the disallowance of a portion of the expenses
Documents supporting a claim for any other
expense relating to the rented property.
Employee Tax Certificates
SARS has stated that employees will no longer be
allowed to make alterations to pre-populated tax certificates on
their personal income tax returns. Where these details are found
to be incorrect, the employee will have to get their employer to
correct and resubmit the certificate. This may well delay the
submission of the employee's tax return and a subsequent levying
of penalties. Therefore, it is vital that employers ensure that
all details are correct before uploading to efiling.
Voluntary Disclosure Programme
his budget speech, the Finance Minister announced an opportunity
for taxpayers to voluntarily disclose their offshore assets and
income. Given that there is a global standard for the automatic
exchange of information between tax authorities, it is advisable
to take advantage of this programme to regularise both tax and
exchange control affairs.
may be submitted from 1 October 2016 to 31 March 2017.
details of the methodology of the application are still to be
announced, It is worthwhile repeating the details that were
released in the media statement of 24 February 2016 and summarised
in our February 2016 issue, as follows:
Applicable to companies and individuals but not
Donors, deceased estates and beneficiaries of
foreign discretionary trusts may participate if they elect to have
the trust’s offshore assets and income deemed as their own
Awareness of a pending audit or investigations
in respect of foreign assets and income prohibits participation
Amounts obtained by SARS through an
international exchange of information procedure will be excluded
Only 50% of the amount used to fund the
offshore acquisition will be included in taxable income
Investment returns prior to 1 March 2010 will
be exempt but those thereafter will be included in taxable income
Any tax debt arising from such disclosure will
be subject to interest with effect from 1 March 2010
Successful applications will not give rise to
any understatement penalties and SAR will not pursue criminal
Exchange Control contraventions prior to 29
February 2016 will be covered by the amnesty
Any persons who are subject to a current
investigation by the reserve bank will be excluded
A levy of 5% of the current market value at 29
February 2016 of repatriated assets and 10% of current market
value at 29 February 2016 of assets that are kept offshore may be
The levy must be paid from foreign sourced
funds and an additional 2% will be imposed where those funds are
insufficient to meet the 5 or 10% levy
Foreign capital allowances may not be utilized
to reduce the leviable amounts nor may the levy be reduced by any
fees or commissions.
It does not matter how well an application is
documented and motivated, an adverse credit rating can result in a
rejection. Finance houses are increasingly using the services of
credit bureaus when reviewing a credit application. Therefore, it
is advisable to obtain an annual credit report from one of the
credit bureaus before submitting the finance application. One such
report per annum may be obtained free of charge. In one instance,
an application was rejected because of an adverse report in
respect of an amount owing to a cell phone company. The company
had reversed the charge on cancellation of the contract but,
despite this, the accounts department had automatically handed the
matter to the bureau. The banks concerned were not prepared to
reverse the rejection despite an explanatory letter from the cell
phone company. In this instance, the applicant had to take the
matter up with the banks’ senior management and the delays
caused by this process almost lost him the deal for which the
finance was required.
to a number of commentators, South Africa’s economic recovery
remains fragile. Contributing factors are electricity and water
supply constraints and weak commodity prices.
electricity problem could worsen during the coming months as
winter takes hold. This factor has already caused a not
insignificant loss of production in our manufacturing sector and
this is likely to worsen as over demand places strain on the
impact of the drought on the country’s water supply has already
resulted in large losses in the agricultural sector resulting in
decreases in the quality of fruit and in the export of
agricultural products. This also effects local consumer inflation.
commodity prices coupled with reduced demand from foreign
countries that are experiencing similar growth restrictions has
forced commodity prices downwards.
factors and others have resulted in the lowering of the SA
economic growth rate and a gradual increase in the inflation rate
both of which have also been impacted by the current political
addition, fuel price pressure adds to inflation and household
borrowing increases as the spending power of take-home pay
decreases. These factors alone could escalate wage increase
demands and production costs fuelling a further rise in inflation.
Analysts predict that the SA Reserve Bank will be motivated to
increase the repo rate by as much as 100 points over the remainder
of this year.
factors all enforce the call, in our previous issue, for a period
of belt tightening.
can’t do anything about the length of your life, but you can do
something about its width and depth”. – H.L.Mencken