ENSafrica Tax In Brief

• Published date: 19 March 2024
• Subject Matter: Employment and HR, Tax, Retirement, Superannuation & Pensions, Income Tax, Sales Taxes: VAT, GST
• Law Firm: ENS
• Author: &nbsp ENSafrica

Below, please find issue 116 of ENS' tax in brief, a snapshot of the latest tax developments in South Africa.

SARS publications

• Tax Practitioner Connect Newsletter | Issue 49
  • This issue includes information on the solar energy tax credit recognition of controlling bodies, registration of tax practitioners, VAT enhancements for estimated assessments and local assets at market value declared on the ITR12 return
  • Find a copy of the Newsletter here.
• Tax Directive System Enhancements Implemented
  • SARS has enhanced the Tax Directives system in line with legislative and system requirements.
  • The following changes to the Tax Directives process will affect external stakeholders
    • Taxation of local and foreign income will now cater for South African citizens who earned income both locally and abroad in one Year of Assessment, but who do not qualify for 10(i)(o)(ii).
    • There will be free portability between funds, such as with transfers to unclaimed benefit funds
      • Unclaimed Pension Preservation Fund
      • Unclaimed Provident Preservation Fund
    • The provisions of the Income Tax Act No. 58 of 1962 ("ITA") confirm that a deduction equal to the value of the amount transferred will be allowed as a deduction for any transfer from a pension fund and pension preservation fund (including an unclaimed-benefit pension preservation fund).
    • This means that the transfer will be tax neutral.
    • The update to the directives system will allow the "Transfer - Unclaimed Benefits" (code 48) to account for transfers between pension, preservation, and provident funds, and unclaimed-benefit funds of each type.
    • The following fund types will be added to the eFiling RT01 screen drop-down menu:
• Tax Directives Legislative Changes
  • Tax directive guides have been updated to include the following changes:
  • The new fields added on the IRP3(s) form to allow for the taxation of local and foreign income for South African citizens who have worked both locally and overseas who do not qualify for exemption under s10(i)(o)(ii).
  • The new fund...