Newly appointed Minister of Finance, Mr Enoch Godongwana will table the MTBPS on the 4th of November at 14h00. The MTBPS sets out the policy framework for the Budget that is presented every February, updates National Treasury's economic forecasts, adjusts the budgets of government departments and makes emergency changes to spending.
Penalties for late filing of Pay As You Earn (PAYE) returns was introduced this year. SARS is in the process of enhancing their Dispute Resolution process to allow for this penalty to be disputed separately from a PAYE late payment penalty.
A crypto asset is a digital representation of value that is not issued by a central bank, but is traded, transferred and stored electronically by natural and legal persons for the purpose of payment, investment and other forms of utility, and applies cryptography techniques in the underlying technology.
Despite the recent relaxation of the national lockdown, various businesses and employees are still negatively impacted by the COVID-19 pandemic. These negative impacts are further exacerbated by the impacts of the recent unrest in the country that destroyed businesses and infrastructure. The Government, therefore, wishes to provide additional assistance to those who continue to be adversely affected by COVID-19, as well as assisting in the process of reconstructing businesses. Moreover, this support measure is aimed at supporting employment in the most vulnerable sections of the labour market.
President Cyril Ramaphosa announced several emergency tax relief measures in response to the continuing Covid-19 pandemic and recent unrest that are aimed at helping affected and tax compliant businesses to recover and ensure livelihoods for employees.
Information and Communication Technologies (ICTs), have shown to be major contributors to the effectiveness of many different businesses throughout the world and are constantly changing the way people and industries operate. ICTs can be defined as an array of technologies that are designed to collect, store, process and communicate information both internally as well as externally, of an organization. This makes ICTs quite a broad category of technologies but some of the most common examples are cloud computing, mobile apps, networked environments and even the Internet!
Filing season starts on the 1st of July this year. The good news is that a significant number of individual taxpayers will be auto-assessed again this year, and this process will start in July. SARS will send you an SMS if you are selected to be auto-assessed. SARS will auto-assess based on the data received from employers, financial institutions, medical schemes, retirement annuity fund administrators and other 3rd party data providers. If you accept your auto-assessment, any under or overpayment of tax will be processed as normal. If you want to edit your return, you can file your return on eFiling or the SARS MobiApp or alternatively contact us for professional assistance in this regards.
Filing Season 2021 for employers, during which they must file the annual Employer Reconciliation Declaration (EMP501), opens on 1 April 2021 and closes on 31 May 2021. The EMP501 must reflect accurate payroll information about their employees, employees’ tax (PAYE) payments made and Tax Certificates (IRP5/IT3) (a)s generated, covering the full tax year from 1 March 2020 to 28 February 2021.
The COVID-19 pandemic has had a severe impact on tax revenue collection. Given large predicted shortfalls in revenue for 2020/21 and over the next three years, the 2020 Medium Term Budget Policy Statement (MTBPS) confirmed that tax increases totalling R40 billion would be required over the next four years to help stabilise public debt and return the public finances to a sustainable position. These increases were first announced in the June 2020 special adjustments budget.
Government is reducing the number of tax incentives, expenditure deductions and assessed loss offsets, with the aim of lowering the corporate income tax rate over the medium term. These changes are expected to enhance efficiency, transparency and fairness in the business tax system, while facilitating economic growth through improved investment and competitiveness.
Personal income tax accounts for about 40 per cent of total tax revenue. In response to extreme levels of inequality, South Africa’s rate structure is highly progressive and covers tax residents’ worldwide income. South Africa has the highest personal income tax share among upper middle-income countries, alongside one of the highest top personal income tax rates.
Tito Mboweni’s big day looms this month, with little progress on the medium-term budget policy speech. The biggest issue relates to the freeze on government wages to which there has been no resolution yet. Let’s hope that we get finality in the upcoming budget.
(Extract from the Medium Term Budget Policy Statement)
In terms of Disaster Management Act relief measures, three payment dates still apply:
With the intention of making it easier to comply with tax obligations, SARS is embarking on an outbound call campaign to assist taxpayers to file their tax returns virtually, either by a telephone or video call.
The deduction available for donations increased
Gazetting of Trade Exposure and Greenhouse Gas Benchmark Regulations and Renewable Energy Premium Notice in Terms of the Carbon Tax Act
The Minister of Finance published on Friday, 19 June 2020 the regulations for the trade exposure and greenhouse gas (GHG) emission intensity benchmark performance allowance, and the notice for the renewable energy premium, in terms of the Carbon Tax Act
In line with the President’s address to the nation on 21 April 2020, the Minister of Finance has provided more detail on the second set of measures that aim to assist individuals and businesses through the pandemic. The interventions include:
The Minister of Finance has announced the following exceptional tax measures as part of the fiscal package outlined by President Cyril Ramaphosa on 23 March 2020 in his speech on the Escalation of Measures to Combat COVID-19. These measures are over and above the tax proposals made in the 2020 Budget on 26 February 2020. The tax adjustments are made in light of the National State of Disaster and due to the significant and potentially lasting negative impacts on the economy from the spreading of the COVID-19 virus. There is a critical need for government interventions to assist with job retention and assist businesses that may be experiencing significant distress. These measures include:
Deferral Of The Payment Of Provisional Tax Liability For Tax Compliant Small To Medium Sized Businesses
In order to assist with alleviating cash flow burdens arising as a result of the COVID-19 outbreak, Government proposes the following tax measures for tax compliant small to medium sized businesses, for a period of twelve months, beginning 1 April 2020 and ending on 31 March 2021:
In order to minimise the loss of jobs during this critical period, Government proposes expanding the ETI programme for a limited period of four months, beginning 1 April 2020 and ending on 31 July 2020 as follows:
Deferral Of The Payment Of Employees’ Tax Liability For Tax Compliant Small To Medium Sized Businesses
In order to assist with alleviating any cash flow burden arising as a result of the COVID-19 outbreak, Government proposes the following tax measures for tax compliant small to medium sized businesses, for a limited period of four months, beginning 1st April 2020 and ending on 31st July 2020:
In light of the Covid-19 outbreak SARS has announced a number of operational changes as detailed below.