A monthly journal, published by PwC South Africa, that gives informed commentary on current developments in the tax arena, both locally and internationally.
Through analysis of and comment on new laws and judicial decisions of interest, Synopsis helps executives to identify developments and trends in tax law and revenue practice that may affect their business.
In this edition:
We look at reimagining the supply of financial services from a VAT perspective, as we analyse the recent judgement in the matter of ABC (Pty) Ltd v CSARS (VAT 1626) [2020] SARSTC. This judgment provides guidance on the principle of direct attribution and the interpretation of financial services.
We discuss the recent case of Fowler v HMRC [2020] UKSC 22, the matter for decision was whether the income derived by Mr Fowler (‘MF’), a deep-sea diver who performed services related to exploration on the continental shelf in UK waters, was income from employment or income from a trade or business. MF was at all relevant times a resident of South Africa. Notwithstanding that this was a judgment of the UK courts, it makes important points that would be equally applicable in South Africa to interpretation of the words used in double tax agreements.
The South African Revenue Service (‘SARS’), by law, is tasked with assessing and collecting taxes. However, in these trying economic times, it is likely that many taxpayers may find themselves in a situation where they are unable to pay their outstanding tax debts to SARS (even with the current draft tax relief measures which have now been introduced in Parliament). The Tax Administration Act, No. 28 of 2011 (‘TAA’) contains additional tax relief measures that may assist financially distressed taxpayers to manage the payment of their tax debts to SARS. One such relief measure is a request for a compromise of debt (or compromise agreement).
Read more on this and other matters in the latest Synopsis below.
Edition: Tax synopsis - June 2020
his month in the matter of Telkom SA SOC Ltd v Commissioner for the South African Revenue Service [2020] ZASCA 19 (25 March 2020), we analyse the second dispute concerning the right of Telkom to deduct commissions paid to selling agents who signed up subscribers.
We analyse the recent judgement of Telkom SA SOC Ltd v Commissioner for the South African Revenue Service [2020] ZASCA 19 and we continue with our "Tax as an strategic asset" series and consider how good visualisation customised for your particular needs, can provide the intuitive edge you need.
This month in the ‘Tax as a strategic asset’ series we look at considerations for tax functions during the COVID-19 pandemic. We also discuss the significant challenges COVID-19 presents to people and investment funds around the globe as the disruption continues to evolve.
We discuss the new ‘Tax as a strategic asset’ series that focuses on the tax function as a value-added business partner. The second article in the series deals with data science in tax and how to upskill, digitalise and adapt to provide an appropriate tax narrative.
We discuss Tax Case No. 24643 where the Gauteng Tax Court was asked to adjudicate the adequacy of the reasons for a penalty assessment levied by SARS following an audit which resulted in the issuing of an additional assessment.
We analyse the decision of the Tax Court in Tax Case 14434, and the principle that income tax is determined by reference to years of assessment.
In recent years a degree of tension has developed in the taxation of companies relating to the valuation of inventories. Companies are obliged to conform with the requirements of IFRS in reporting the value of inventories at the lower of cost or net realisable value.
We analyse the court case of BMW South Africa (Pty) Ltd v CSARS. International groups frequently apply tax equalisation principles to protect employees on assignment in a foreign territory from an unwelcome reduction in their anticipated take-home pay because of differential tax treatment of the remuneration they derive between the host jurisdiction and the jurisdiction of residence.
We look at key issues taxpayers need to consider if they are being audited by SARS. We discuss the proposed amendment in the draft Tax Administration Laws Amendment Bill, 2019, that the legislation be amended concerning the application of reduced rates of withholding taxes on royalty, interest and dividend payments where such reductions are permitted in terms of a double tax agreement (‘DTA’).
National Treasury published the Draft Taxation Laws Amendment Bill for public comment. We discuss the proposed amendments to our ‘controlled foreign company’ (‘CFC’) rules which seek to reduce the high tax exemption (‘HTE’) threshold and to strengthen the anti-diversionary rules.
