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18 July 2018

South Africa publishes draft 2018 tax amendment bills for public comment

On 16 July 2018, South Africa's National Treasury published the 2018 Draft Taxation Laws Amendment Bill (DTLAB) and the 2018 Draft Tax Administration Laws Amendment Bill (DTALAB) for public comment. Comments are due by the close of business on 16 August 2018.

The amendments proposed are primarily in respect of the more complex tax proposals that were announced in the 2018 Budget Review on 21 February 2018 and refinements of legislative changes introduced in recent years.

The main tax proposals contained in the DTLAB are:

  • Reduced write-off period for electronic communications cables
  • Refinements and clarification for the conversion of debt to equity
  • Refinement of the interaction between the anti-avoidance rules for dividend stripping with corporate reorganization rules
  • New rules addressing the use of trusts to defer tax or recharacterize the nature of income
  • Introduction of a one-year income characterization rule for amounts accrued to portfolios of collective investment schemes to provide certainty and limit potential abuse
  • Review of the International Shipping exemption for purposes of accommodating the use of replacement ships

The main tax administration proposals contained in the DTALAB relate to:

  • Removal of the requirement to submit tax returns for individuals receiving a tax-exempt dividend
  • Anti-forestalling amendments for excise duties
  • Clarifications on handling incorrect invoices for value-added tax (VAT) refunds
  • Allowing the collection of VAT payments to apply across branches and divisions

A detailed Alert will follow shortly.

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CONTACTS

For additional information with respect to this Alert, please contact the following:

Ernst & Young Advisory Services (Pty) Ltd., Cape Town

  • Ide Louw
    ide.louw@za.ey.com

Ernst & Young Advisory Services (Pty) Ltd., Johannesburg

  • Marius Leivestad
    marius.leivestad@za.ey.com

Ernst & Young LLP (United Kingdom), Pan African Tax Desk, London

  • Rendani Neluvhalani
    rendani.mabel.neluvhalani@uk.ey.com
  • Byron Thomas
    bthomas4@uk.ey.com

Ernst & Young LLP, Pan African Tax Desk, New York

  • Silke Mattern
    silke.mattern@ey.com
  • Dele A. Olaogun
    dele.olaogun@ey.com

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ATTACHMENT

PDF version of this Tax Alert

 

Document ID: 2018-5867

 
 

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