Corporate financial reporting: history, development and future directions
- Prinsloo, K S (Keith Stephen)
- Authors: Prinsloo, K S (Keith Stephen)
- Date: 1983
- Subjects: Corporations -- Finance , Financial statements , Accounting
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:902 , http://hdl.handle.net/10962/d1007055 , Corporations -- Finance , Financial statements , Accounting
- Description: KMBT_363 , Adobe Acrobat 9.53 Paper Capture Plug-in
- Full Text:
- Date Issued: 1983
- Authors: Prinsloo, K S (Keith Stephen)
- Date: 1983
- Subjects: Corporations -- Finance , Financial statements , Accounting
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:902 , http://hdl.handle.net/10962/d1007055 , Corporations -- Finance , Financial statements , Accounting
- Description: KMBT_363 , Adobe Acrobat 9.53 Paper Capture Plug-in
- Full Text:
- Date Issued: 1983
Some aspects of the advertising of professional accounting services
- Jackson, Robert David Charles
- Authors: Jackson, Robert David Charles
- Date: 1983
- Subjects: Accounting -- Marketing , Advertising -- Accounting
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:901 , http://hdl.handle.net/10962/d1006301 , Accounting -- Marketing , Advertising -- Accounting
- Description: This thesis examines the opinions of a sample of partners in accounting firms within the Republic of South Africa on the advertising of professional accounting services. The advertising of professional accounting services has become a highly contentious and complex topic. This thesis identifies eight issues related to the topic and examines the partners' opinions on these issues. In addition, the partners' opinions are examined in relation to the possible placing, means and methods of advertising of professional accounting services as well as the possible content of advertisements for professional accounting services. A methodology was designed to obtain the opinions of partners from all provinces of the Republic, from varying sizes of accounting firm, of varying ages and experience, and from both official language groups. The opinions were then analysed . The research findings show that a number of major differences of opinion exist within the profession, and that generally the present rules and regulations pertaining to advertising are in need of revision. This thesis makes a number of recommendations for revision as part of what should be an ongoing process. This thesis is only part of what needs to be done in this field. A great deal more research is imperative if a satisfactory set of rules and regulations for the advertising of professional accounting services is to be maintained.
- Full Text:
- Date Issued: 1983
- Authors: Jackson, Robert David Charles
- Date: 1983
- Subjects: Accounting -- Marketing , Advertising -- Accounting
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:901 , http://hdl.handle.net/10962/d1006301 , Accounting -- Marketing , Advertising -- Accounting
- Description: This thesis examines the opinions of a sample of partners in accounting firms within the Republic of South Africa on the advertising of professional accounting services. The advertising of professional accounting services has become a highly contentious and complex topic. This thesis identifies eight issues related to the topic and examines the partners' opinions on these issues. In addition, the partners' opinions are examined in relation to the possible placing, means and methods of advertising of professional accounting services as well as the possible content of advertisements for professional accounting services. A methodology was designed to obtain the opinions of partners from all provinces of the Republic, from varying sizes of accounting firm, of varying ages and experience, and from both official language groups. The opinions were then analysed . The research findings show that a number of major differences of opinion exist within the profession, and that generally the present rules and regulations pertaining to advertising are in need of revision. This thesis makes a number of recommendations for revision as part of what should be an ongoing process. This thesis is only part of what needs to be done in this field. A great deal more research is imperative if a satisfactory set of rules and regulations for the advertising of professional accounting services is to be maintained.
- Full Text:
- Date Issued: 1983
An historical perspective of income tax legislation in South Africa, 1910 to 1925
- Authors: Surtees, Peter Geoffrey
- Date: 1986
- Subjects: Income tax -- South Africa , Income tax -- Law and legislation -- South Africa , Income tax -- South Africa -- History
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:898 , http://hdl.handle.net/10962/d1004578 , Income tax -- South Africa , Income tax -- Law and legislation -- South Africa , Income tax -- South Africa -- History
- Description: From Introduction: This work considers the period from Union, 31 May 1910 until promulgation of the Income Tax Act No. 40 of 1925.(1) It will describe the means, both financial and otherwise, by which the fledgling Government of the Union of South Africa contrived to balance its budget, and will consider the various sources of revenue available up to 1914, when the Government of Gen. Louis Botha first decided that a tax on income was necessary in order to maintain the solvency of the new State. Similarly the political pressures which shaped the nature of the Income Tax Acts up to 1925 will be discussed, and the political principles (or expediencies, depending on the degree of cynicism of the reader) which led the parties in power from time to time to make the decisions they did regarding the provisions of the various Acts. The effect of external political situations such as the Great War of 1914 - 1918 will be examined, as will the consequences of the rebellion of 1914 and the strikes of 1913 and 1922. The legislation predictably spawned a considerable body of litigation as taxpayers hastened to find and exploit loopholes in it; the resultant Income Tax Cases, in the Income Tax Special Court, Supreme Court and Appeal Court, formed the embryo of a body of judicial precedent which today encompasses some two thousand case reports. A few of the cases decided in the period up to 1925 are still quoted today; for example, CIR v Lunnon 1924 AD 1 SATC 7. The relevant cases from the period will enjoy consideration, with descriptions of how their verdicts affected either subsequent income tax principles or later legislation. Also considered will be the inception during this period of the way in which income tax legislation largely develops: the legislature promulgates an Act, the taxpayers discover legitimate ways to reduce their tax burden and the Minister of Finance consequently causes the Act to be changed in order to protect the tax base. Thereupon the resolute taxpayers seek loopholes anew. The effect of economic conditions on income tax legislation will engage attention; several such conditions cast their shadows into the House of Assembly during that 15 year period, notably the post-war recession and the drought of 1919. The selection of this period is apposite for several reasons: it covers the period during which income tax legislation came into being; - it includes several notable political occurrences. thus making possible a consideration of their effect on income tax legislation; it includes a natural cataclysm. namely a major drought. which also had an effect on subsequent Income Tax Acts; - a sufficient number of income tax cases was heard during the period to afford a fair indication both of how the body of case law would develop and how it would perpetually interplay with the legislation; it clearly illustrates the differences between the two great political parties of the time, differences largely caused by the vested interests of each; the dominant South African Party, with its need to retain the support of the commercial and particularly the mining sectors, and the smaller but even then growing National Party with its face set firmly towards the rural constituencies and the embattled farmers; - the period culminates in the Income Tax Act of 1925, a significant change from its predecessors, and the second Income Tax Act of the Pact Government. The imposition of taxes by the respective provinces does not form part of this work, as the scope of the discussion is limited to the various Income Tax Acts, and their development has been overseen by the central government.
- Full Text:
- Date Issued: 1986
- Authors: Surtees, Peter Geoffrey
- Date: 1986
- Subjects: Income tax -- South Africa , Income tax -- Law and legislation -- South Africa , Income tax -- South Africa -- History
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:898 , http://hdl.handle.net/10962/d1004578 , Income tax -- South Africa , Income tax -- Law and legislation -- South Africa , Income tax -- South Africa -- History
- Description: From Introduction: This work considers the period from Union, 31 May 1910 until promulgation of the Income Tax Act No. 40 of 1925.(1) It will describe the means, both financial and otherwise, by which the fledgling Government of the Union of South Africa contrived to balance its budget, and will consider the various sources of revenue available up to 1914, when the Government of Gen. Louis Botha first decided that a tax on income was necessary in order to maintain the solvency of the new State. Similarly the political pressures which shaped the nature of the Income Tax Acts up to 1925 will be discussed, and the political principles (or expediencies, depending on the degree of cynicism of the reader) which led the parties in power from time to time to make the decisions they did regarding the provisions of the various Acts. The effect of external political situations such as the Great War of 1914 - 1918 will be examined, as will the consequences of the rebellion of 1914 and the strikes of 1913 and 1922. The legislation predictably spawned a considerable body of litigation as taxpayers hastened to find and exploit loopholes in it; the resultant Income Tax Cases, in the Income Tax Special Court, Supreme Court and Appeal Court, formed the embryo of a body of judicial precedent which today encompasses some two thousand case reports. A few of the cases decided in the period up to 1925 are still quoted today; for example, CIR v Lunnon 1924 AD 1 SATC 7. The relevant cases from the period will enjoy consideration, with descriptions of how their verdicts affected either subsequent income tax principles or later legislation. Also considered will be the inception during this period of the way in which income tax legislation largely develops: the legislature promulgates an Act, the taxpayers discover legitimate ways to reduce their tax burden and the Minister of Finance consequently causes the Act to be changed in order to protect the tax base. Thereupon the resolute taxpayers seek loopholes anew. The effect of economic conditions on income tax legislation will engage attention; several such conditions cast their shadows into the House of Assembly during that 15 year period, notably the post-war recession and the drought of 1919. The selection of this period is apposite for several reasons: it covers the period during which income tax legislation came into being; - it includes several notable political occurrences. thus making possible a consideration of their effect on income tax legislation; it includes a natural cataclysm. namely a major drought. which also had an effect on subsequent Income Tax Acts; - a sufficient number of income tax cases was heard during the period to afford a fair indication both of how the body of case law would develop and how it would perpetually interplay with the legislation; it clearly illustrates the differences between the two great political parties of the time, differences largely caused by the vested interests of each; the dominant South African Party, with its need to retain the support of the commercial and particularly the mining sectors, and the smaller but even then growing National Party with its face set firmly towards the rural constituencies and the embattled farmers; - the period culminates in the Income Tax Act of 1925, a significant change from its predecessors, and the second Income Tax Act of the Pact Government. The imposition of taxes by the respective provinces does not form part of this work, as the scope of the discussion is limited to the various Income Tax Acts, and their development has been overseen by the central government.
- Full Text:
- Date Issued: 1986
The profit maximising pricing model
- Authors: Jackson, Cecil Wilfred
- Date: 1988
- Subjects: Profit -- Mathematical models , Pricing -- Mathematical models
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:899 , http://hdl.handle.net/10962/d1004597 , Profit -- Mathematical models , Pricing -- Mathematical models
- Full Text:
- Date Issued: 1988
- Authors: Jackson, Cecil Wilfred
- Date: 1988
- Subjects: Profit -- Mathematical models , Pricing -- Mathematical models
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:899 , http://hdl.handle.net/10962/d1004597 , Profit -- Mathematical models , Pricing -- Mathematical models
- Full Text:
- Date Issued: 1988
The effects of high school accounting study on first year students' performance in financial accounting at selected South African universities
- Authors: Rowlands, Jeffrey Everard
- Date: 1989
- Subjects: Accounting -- Study and teaching (Higher) , Accounting -- Study and teaching (Secondary)
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:873 , http://hdl.handle.net/10962/d1001605
- Description: This thesis examines the opinions of a sample of accounting students and a sample of accounting lecturers regarding the effect of prior study of accounting on performance in the first year university financial accounting course. A comparison is also made of actual performance in the first year course of two groups of students, those who have studied accounting at secondary school and those who have not. For the comparison of actual performance data were collected over a three year period (1985-1987). Two separate research designs were used to test for differences in performance. Both research designs indicated that students with secondary school accounting scored higher on early tests and examinations but that the two groups of students scored equally on the final examination. The survey of students' opinions included students from two universities. The major findings showed that students, regardless of whether or not they had studied accounting at secondary level, believed those who had to be advantaged in the first year financial accounting course. The majority of respondents indicated that high school accounting was, in their opinion, a desirable preparation for the university course. The survey of lecturers' opinions included lecturers from 15 South African universities. The findings of primary concern showed that lecturers believed students with prior exposure to accounting to be at an advantage in the first year financial accounting course.
- Full Text:
- Date Issued: 1989
- Authors: Rowlands, Jeffrey Everard
- Date: 1989
- Subjects: Accounting -- Study and teaching (Higher) , Accounting -- Study and teaching (Secondary)
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:873 , http://hdl.handle.net/10962/d1001605
- Description: This thesis examines the opinions of a sample of accounting students and a sample of accounting lecturers regarding the effect of prior study of accounting on performance in the first year university financial accounting course. A comparison is also made of actual performance in the first year course of two groups of students, those who have studied accounting at secondary school and those who have not. For the comparison of actual performance data were collected over a three year period (1985-1987). Two separate research designs were used to test for differences in performance. Both research designs indicated that students with secondary school accounting scored higher on early tests and examinations but that the two groups of students scored equally on the final examination. The survey of students' opinions included students from two universities. The major findings showed that students, regardless of whether or not they had studied accounting at secondary level, believed those who had to be advantaged in the first year financial accounting course. The majority of respondents indicated that high school accounting was, in their opinion, a desirable preparation for the university course. The survey of lecturers' opinions included lecturers from 15 South African universities. The findings of primary concern showed that lecturers believed students with prior exposure to accounting to be at an advantage in the first year financial accounting course.
- Full Text:
- Date Issued: 1989
Corporate taxes and the taxation of dividends
- Authors: Williams, John Mark
- Date: 1997
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:890 , http://hdl.handle.net/10962/d1001644
- Description: The classical system of taxation, whereby companies are taxed without a deduction for dividends paid and shareholders are taxed on their dividend receipts, results in double taxation of dividends. Split rate and imputation systems have been developed in an attempt to mitigate the effects of double taxation of dividends. Double taxation of dividends and differences between corporate and maximum individual marginal tax rates result in corporate tax systems lacking neutrality. Distortions arise between organisational forms, between debt and equity financing and between the retention and distribution of profits. Various methods of integrating corporate and individual taxes have been advocated to overcome the lack of neutrality caused by corporate taxes. Following the introduction of the South African Income Tax Act in 1914, a number of taxes relating to dividends have existed. These have included a Dividend Tax, Non-resident Shareholder's Tax, Undistributed Profits Tax and Secondary Tax on Companies, hereafter referred to as STC. STC is a tax on net dividends declared and results in distributed income being taxed at higher rates than retained income. Despite the implementation of group relief provisions, STC results in an inhibition on the reinvestment of profits within the context of a group of companies. It is also a major cause of the lack of neutrality of the South African corporate tax system. As a result of the lack of neutrality and inhibition of group reinvestment caused by STC, a full imputation system is suggested as an alternative to replace STC.
- Full Text:
- Date Issued: 1997
- Authors: Williams, John Mark
- Date: 1997
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:890 , http://hdl.handle.net/10962/d1001644
- Description: The classical system of taxation, whereby companies are taxed without a deduction for dividends paid and shareholders are taxed on their dividend receipts, results in double taxation of dividends. Split rate and imputation systems have been developed in an attempt to mitigate the effects of double taxation of dividends. Double taxation of dividends and differences between corporate and maximum individual marginal tax rates result in corporate tax systems lacking neutrality. Distortions arise between organisational forms, between debt and equity financing and between the retention and distribution of profits. Various methods of integrating corporate and individual taxes have been advocated to overcome the lack of neutrality caused by corporate taxes. Following the introduction of the South African Income Tax Act in 1914, a number of taxes relating to dividends have existed. These have included a Dividend Tax, Non-resident Shareholder's Tax, Undistributed Profits Tax and Secondary Tax on Companies, hereafter referred to as STC. STC is a tax on net dividends declared and results in distributed income being taxed at higher rates than retained income. Despite the implementation of group relief provisions, STC results in an inhibition on the reinvestment of profits within the context of a group of companies. It is also a major cause of the lack of neutrality of the South African corporate tax system. As a result of the lack of neutrality and inhibition of group reinvestment caused by STC, a full imputation system is suggested as an alternative to replace STC.
- Full Text:
- Date Issued: 1997
Valuation of intellectual capital in South African companies: a comparative study of three valuation methods
- Authors: Maree, Kevin W
- Date: 2002
- Subjects: Accounting
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:877 , http://hdl.handle.net/10962/d1001631
- Description: This study discusses three valuation methods for intellectual capital and considers two of these (Tobin’s “q” and CIV) as suitable valuation methods.
- Full Text:
- Date Issued: 2002
- Authors: Maree, Kevin W
- Date: 2002
- Subjects: Accounting
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:877 , http://hdl.handle.net/10962/d1001631
- Description: This study discusses three valuation methods for intellectual capital and considers two of these (Tobin’s “q” and CIV) as suitable valuation methods.
- Full Text:
- Date Issued: 2002
A comparison of the effectiveness of the judicial doctrine of "substance over form" with legislated measures in combatting tax avoidance
- Authors: Weston, Tracey Lee
- Date: 2004
- Subjects: Income tax -- South Africa Income tax -- Law and legislation -- South Africa Income tax -- Law and legislation -- Great Britain Tax evasion -- Great Britain Tax evasion -- South Africa Tax administration and procedure -- South Africa Tax administration and procedure -- Great Britain Tax planning -- South Africa Tax planning -- Great Britain Taxation -- Law and legislation -- South Africa Taxation -- Law and legislation -- Great Britain
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:892 , http://hdl.handle.net/10962/100
- Description: Taxation statutes often provide opportunities for tax avoidance by taxpayers who exploit the provisions of the taxing statute to reduce the tax that they are legally required to pay. It is, however, important to distinguish between the concepts of tax avoidance and tax evasion. The central issue, especially where the contract has no business purpose, is whether it is possible for the substance and legal form of the transaction to differ to such an extent that a court of law will favour the substance rather than the legal format. The debate is whether the courts should be encouraged to continue with their "judge-made" law or whether the tax jurisdictions should be supporting a legislative route as opposed to a judicial one, in their efforts not only to combat tax avoidance but also to preserve taxpayer certainty. The question is whether the Doctrine of "Substance over Form" as applied by the judiciary is effective in combating tax avoidance, or whether a legislated general anti-avoidance provision is required. An intensive literature survey examines the changes which have occurred in the application of judicial tests from the 1930's to date and investigates the different approaches tax jurisdictions follow in order to combat tax avoidance. The effect of the introduction of anti-avoidance provisions in combating tax avoidance is evaluated by making a comparison between the United Kingdom and South Africa. [n the United Kingdom, the courts are relied on to create anti-tax avoidance rules, one of which is the Doctrine of "Substance over Form". The doctrine is very broad and identifies various applications of the doctrine, which have been developed by the courts. In South Africa, the Doctrine of "Substance over Form" has been applied in certain tax cases; however the South African Income Tax Act does include anti-tax avoidance sections aimed at specific tax avoidance schemes, as well as a general anti-tax avoidance measure enacted as section 103. The judicial tests have progressed and changed over time and the introduction of anti-avoidance legislation in the Income Tax Act has had an effect on tax planning opportunities. A distinction needs to be made between fraudulent and bona fide transactions while recognising the taxpayer's right to arrange his or her affairs in a manner which is beneficial to him or her from a tax perspective. Judicial activism and judicial legislation in the United Kingdom has created much uncertainty amongst taxpayers and as a result strongly supports the retention of a general anti-avoidance section within an Income Tax Act. A general anti-avoidance provision, following a legislative route, appears to be more consistent and effective in combating tax avoidance.
- Full Text:
- Date Issued: 2004
- Authors: Weston, Tracey Lee
- Date: 2004
- Subjects: Income tax -- South Africa Income tax -- Law and legislation -- South Africa Income tax -- Law and legislation -- Great Britain Tax evasion -- Great Britain Tax evasion -- South Africa Tax administration and procedure -- South Africa Tax administration and procedure -- Great Britain Tax planning -- South Africa Tax planning -- Great Britain Taxation -- Law and legislation -- South Africa Taxation -- Law and legislation -- Great Britain
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:892 , http://hdl.handle.net/10962/100
- Description: Taxation statutes often provide opportunities for tax avoidance by taxpayers who exploit the provisions of the taxing statute to reduce the tax that they are legally required to pay. It is, however, important to distinguish between the concepts of tax avoidance and tax evasion. The central issue, especially where the contract has no business purpose, is whether it is possible for the substance and legal form of the transaction to differ to such an extent that a court of law will favour the substance rather than the legal format. The debate is whether the courts should be encouraged to continue with their "judge-made" law or whether the tax jurisdictions should be supporting a legislative route as opposed to a judicial one, in their efforts not only to combat tax avoidance but also to preserve taxpayer certainty. The question is whether the Doctrine of "Substance over Form" as applied by the judiciary is effective in combating tax avoidance, or whether a legislated general anti-avoidance provision is required. An intensive literature survey examines the changes which have occurred in the application of judicial tests from the 1930's to date and investigates the different approaches tax jurisdictions follow in order to combat tax avoidance. The effect of the introduction of anti-avoidance provisions in combating tax avoidance is evaluated by making a comparison between the United Kingdom and South Africa. [n the United Kingdom, the courts are relied on to create anti-tax avoidance rules, one of which is the Doctrine of "Substance over Form". The doctrine is very broad and identifies various applications of the doctrine, which have been developed by the courts. In South Africa, the Doctrine of "Substance over Form" has been applied in certain tax cases; however the South African Income Tax Act does include anti-tax avoidance sections aimed at specific tax avoidance schemes, as well as a general anti-tax avoidance measure enacted as section 103. The judicial tests have progressed and changed over time and the introduction of anti-avoidance legislation in the Income Tax Act has had an effect on tax planning opportunities. A distinction needs to be made between fraudulent and bona fide transactions while recognising the taxpayer's right to arrange his or her affairs in a manner which is beneficial to him or her from a tax perspective. Judicial activism and judicial legislation in the United Kingdom has created much uncertainty amongst taxpayers and as a result strongly supports the retention of a general anti-avoidance section within an Income Tax Act. A general anti-avoidance provision, following a legislative route, appears to be more consistent and effective in combating tax avoidance.
- Full Text:
- Date Issued: 2004
An analysis of the compliance approach used by revenue authorities with specific reference to case selection and risk profiling
- Nel, M J
- Authors: Nel, M J
- Date: 2005
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:878 , http://hdl.handle.net/10962/d1001632
- Description: The vision of probably all revenue authorities is to promote compliance with the provisions of the taxation laws and to ensure responsible enforcement by the revenue authorities, thereby contributing to the economic well being of the country. As with virtually all revenue authorities the South African Revenue Services has to a large extent implemented the self-assessment approach to tax assessments. Because this system depends on this process of selfassessment, an effective risk-based audit approach is required to ensure that tax compliance and responsible enforcement is adhered to. An effective case selection methodology is required for revenue authorities to make informed choices on how best to direct their activities in order to address areas of greatest risk. Given these imperatives, the purpose of this study is to examine the case selection methodologies used by certain revenue authorities, including the South African Revenue Services, and to focus on the key elements of case selection: the use of computerised database systems, industry profiles, third party data and the role of the risk profiler. The results of the study indicate that the case selection methodology of the South African Revenue Services is lacking in some areas. Computerised risk analysis is limited to a certain classes of taxpayers and other aspects of concern are also highlighted in this study.
- Full Text:
- Date Issued: 2005
- Authors: Nel, M J
- Date: 2005
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:878 , http://hdl.handle.net/10962/d1001632
- Description: The vision of probably all revenue authorities is to promote compliance with the provisions of the taxation laws and to ensure responsible enforcement by the revenue authorities, thereby contributing to the economic well being of the country. As with virtually all revenue authorities the South African Revenue Services has to a large extent implemented the self-assessment approach to tax assessments. Because this system depends on this process of selfassessment, an effective risk-based audit approach is required to ensure that tax compliance and responsible enforcement is adhered to. An effective case selection methodology is required for revenue authorities to make informed choices on how best to direct their activities in order to address areas of greatest risk. Given these imperatives, the purpose of this study is to examine the case selection methodologies used by certain revenue authorities, including the South African Revenue Services, and to focus on the key elements of case selection: the use of computerised database systems, industry profiles, third party data and the role of the risk profiler. The results of the study indicate that the case selection methodology of the South African Revenue Services is lacking in some areas. Computerised risk analysis is limited to a certain classes of taxpayers and other aspects of concern are also highlighted in this study.
- Full Text:
- Date Issued: 2005
A financial planning model for retirement, taking into account the impact of pre-retirement funding income, age and taxation
- Authors: Barnes, Andrew
- Date: 2006
- Subjects: Retirement -- South Africa Retirement income -- Planning -- South Africa Pensions -- Planning -- South Africa Finance, Personal Investments Income tax -- Law and legislation -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:895 , http://hdl.handle.net/10962/d1004532
- Description: Individuals are often not aware of the required level of contributions needed to fund a retirement savings plan. This problem is compounded by the fact that the assistance provided to these individuals by way of commercially-available retirement planning models does not take into account the effect of income tax on the level of required retirement savings contributions and recent changes in the tax legislation to the income tax payable by individuals has had a significant effect on these required levels. As a preamble to the research process, an exploratory questionnaire was administrated to a sample of individuals, which was designed to measure the level of awareness of these individuals of the contributions to a retirement savings plan needed to fund their postretirement financial needs, and of the impact of age, the level of income and income tax on their contributions. Responses to the questionnaire indicated a low level of awareness of retirement planning amongst these individuals. A retirement planning model was then designed to test the effect of earnings, age and changes in tax legislation on the level of an individual's required monthly contributions to a retirement savings plan. Independent variables of age and income were processed using the model. These same variables were then processed using the Old Mutual and Liberty Life retirement planning models and a comparison was made between the model developed in the research and these commercially developed models, to assess their usefulness and limitations. Based on the above comparison, it appeared that the Old Mutual and Liberty Life retirement models both included the effects of the individual marginal tax rates in their calculations. However, they appeared to be using marginal tax rates which were higher than those reflected in the 2006 individual income tax tables. In addition these models did not include the effect of income tax exemptions and deductions and they therefore provided more conservative estimates than the retirement planning model designed in the research. Recent tax adjustments have had the effect of greatly increasing the after-tax income of individuals and therefore it is important to include the effects of changes in tax legislation in determining the monthly contributions to a retirement savings plan.
- Full Text:
- Date Issued: 2006
- Authors: Barnes, Andrew
- Date: 2006
- Subjects: Retirement -- South Africa Retirement income -- Planning -- South Africa Pensions -- Planning -- South Africa Finance, Personal Investments Income tax -- Law and legislation -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:895 , http://hdl.handle.net/10962/d1004532
- Description: Individuals are often not aware of the required level of contributions needed to fund a retirement savings plan. This problem is compounded by the fact that the assistance provided to these individuals by way of commercially-available retirement planning models does not take into account the effect of income tax on the level of required retirement savings contributions and recent changes in the tax legislation to the income tax payable by individuals has had a significant effect on these required levels. As a preamble to the research process, an exploratory questionnaire was administrated to a sample of individuals, which was designed to measure the level of awareness of these individuals of the contributions to a retirement savings plan needed to fund their postretirement financial needs, and of the impact of age, the level of income and income tax on their contributions. Responses to the questionnaire indicated a low level of awareness of retirement planning amongst these individuals. A retirement planning model was then designed to test the effect of earnings, age and changes in tax legislation on the level of an individual's required monthly contributions to a retirement savings plan. Independent variables of age and income were processed using the model. These same variables were then processed using the Old Mutual and Liberty Life retirement planning models and a comparison was made between the model developed in the research and these commercially developed models, to assess their usefulness and limitations. Based on the above comparison, it appeared that the Old Mutual and Liberty Life retirement models both included the effects of the individual marginal tax rates in their calculations. However, they appeared to be using marginal tax rates which were higher than those reflected in the 2006 individual income tax tables. In addition these models did not include the effect of income tax exemptions and deductions and they therefore provided more conservative estimates than the retirement planning model designed in the research. Recent tax adjustments have had the effect of greatly increasing the after-tax income of individuals and therefore it is important to include the effects of changes in tax legislation in determining the monthly contributions to a retirement savings plan.
- Full Text:
- Date Issued: 2006
The regulation of tax practitioners in South Africa: a proposed model
- Authors: Woodbridge, Taryn
- Date: 2006
- Subjects: Income tax -- Law and legislation -- South Africa , Taxation -- Law and legislation -- South Africa , South African Revenue Service
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:891 , http://hdl.handle.net/10962/d1003128 , Income tax -- Law and legislation -- South Africa , Taxation -- Law and legislation -- South Africa , South African Revenue Service
- Description: Tax practitioners in South Africa have been operating in an unregulated tax industry. This has allowed certain tax practitioners to fail in their duties to their clients, as many do not have to abide by any code of conduct or ethical principles, to the detriment of the public. Other than the provisions in the Income Tax Act, 58 of 1962, there has been no regulation. As a result of losses suffered by taxpayers either through the incompetence, ignorance or negligence of a tax practitioner, as substantiated by case law, and increased costs borne by the South African Revenue Services due to unnecessary queries and tax disputes, the Minister of Finance, Trevor Manuel, introduced the concept of tax industry regulation in his Budget Speech in 2002. This resulted in the introduction of section 67 A into the Income Tax Act, providing for a registration process for tax practitioners. All practising tax practitioners were required to register with the Commissioner for the South African Revenue Services by 30 June 2005. In addition, a discussion paper was issued in 2002 setting out the proposal of the Revenue Services to regulate the tax industry through the formation of an Association of Tax Practitioners. This proposal includes various contentious issues and casts significant doubt on whether the proposed model is the most suitable. The goal of the research was therefore to evaluate the current status of tax advisory services in order to demonstrate the need for regulation and to compare the proposed SARS model with two established regulatory authorities: the Estate Agency Affairs Board and the Australian Tax Agents Board. A conceptual model for regulation was developed in order to test all the models against a simple regulatory framework to determine whether each was aligned to certain best practices proposed in this framework. The research methodology was qualitative in nature, involving the critical interpretation of documentary data and data generated during a public discussion forum of tax practitioners. It was concluded that the SARS proposal is too prescriptive and, at the same time, too broad in its scope. In order to address the key objective, identified as protection of the taxpaying public, a simplified regulation procedure was recommended, which would adhere to the proposed regulatory framework. , KMBT_363
- Full Text:
- Date Issued: 2006
- Authors: Woodbridge, Taryn
- Date: 2006
- Subjects: Income tax -- Law and legislation -- South Africa , Taxation -- Law and legislation -- South Africa , South African Revenue Service
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:891 , http://hdl.handle.net/10962/d1003128 , Income tax -- Law and legislation -- South Africa , Taxation -- Law and legislation -- South Africa , South African Revenue Service
- Description: Tax practitioners in South Africa have been operating in an unregulated tax industry. This has allowed certain tax practitioners to fail in their duties to their clients, as many do not have to abide by any code of conduct or ethical principles, to the detriment of the public. Other than the provisions in the Income Tax Act, 58 of 1962, there has been no regulation. As a result of losses suffered by taxpayers either through the incompetence, ignorance or negligence of a tax practitioner, as substantiated by case law, and increased costs borne by the South African Revenue Services due to unnecessary queries and tax disputes, the Minister of Finance, Trevor Manuel, introduced the concept of tax industry regulation in his Budget Speech in 2002. This resulted in the introduction of section 67 A into the Income Tax Act, providing for a registration process for tax practitioners. All practising tax practitioners were required to register with the Commissioner for the South African Revenue Services by 30 June 2005. In addition, a discussion paper was issued in 2002 setting out the proposal of the Revenue Services to regulate the tax industry through the formation of an Association of Tax Practitioners. This proposal includes various contentious issues and casts significant doubt on whether the proposed model is the most suitable. The goal of the research was therefore to evaluate the current status of tax advisory services in order to demonstrate the need for regulation and to compare the proposed SARS model with two established regulatory authorities: the Estate Agency Affairs Board and the Australian Tax Agents Board. A conceptual model for regulation was developed in order to test all the models against a simple regulatory framework to determine whether each was aligned to certain best practices proposed in this framework. The research methodology was qualitative in nature, involving the critical interpretation of documentary data and data generated during a public discussion forum of tax practitioners. It was concluded that the SARS proposal is too prescriptive and, at the same time, too broad in its scope. In order to address the key objective, identified as protection of the taxpaying public, a simplified regulation procedure was recommended, which would adhere to the proposed regulatory framework. , KMBT_363
- Full Text:
- Date Issued: 2006
The taxation of black economic empowerment transactions, with specific reference to the financial sector
- Authors: Kamlana, Unathi
- Date: 2006
- Subjects: Black people -- South Africa -- Economic conditions , Business enterprises, Black -- Taxation -- South Africa , Employee empowerment -- South Africa , Income tax -- Law and legislation -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:896 , http://hdl.handle.net/10962/d1004544 , Black people -- South Africa -- Economic conditions , Business enterprises, Black -- Taxation -- South Africa , Employee empowerment -- South Africa , Income tax -- Law and legislation -- South Africa
- Description: There has been some concern that the pace of expectations being built up regarding the transfer of ownership of the economy into the hands of the previously disadvantaged was not allowing for the due diligence and analysis of the implications of such transactions. Tax legislation relating to the transfer of assets is also not seen to be consistently conducive to this process. The focus of this thesis is taxation and a critical analysis of how the current tax legislation affects most of the transactions which usually form the basis of black economic empowerment. It is argued that tax policy is one of the fundamental instruments available to government to encourage the process of black economic empowerment. It is therefore important to assess whether or not current tax legislation is supportive of the process of black economic empowerment and to suggest ways in which it can be amended to serve this purpose. By means of a literature review and a case study of a Black Economic Empowerment deal in the financial sector, the thesis examines various sections of the Income Tax Act, 58 of 1962, which may have a bearing on black economic empowerment transactions and structures, including corporate restructuring rules, the taxation of trusts, inter-company loans, the use of hybrid financial instruments, the taxation of small business corporations, employee share incentive schemes, connected persons rules and value-shifting arrangements, the general deduction formula and the deductibility of interest incurred on amounts raised to acquire shares. It appears that although some aspects of the current tax legislation lend themselves to assisting black economic empowerment transactions, there are still areas where much improvement is required. , KMBT_363
- Full Text:
- Date Issued: 2006
- Authors: Kamlana, Unathi
- Date: 2006
- Subjects: Black people -- South Africa -- Economic conditions , Business enterprises, Black -- Taxation -- South Africa , Employee empowerment -- South Africa , Income tax -- Law and legislation -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:896 , http://hdl.handle.net/10962/d1004544 , Black people -- South Africa -- Economic conditions , Business enterprises, Black -- Taxation -- South Africa , Employee empowerment -- South Africa , Income tax -- Law and legislation -- South Africa
- Description: There has been some concern that the pace of expectations being built up regarding the transfer of ownership of the economy into the hands of the previously disadvantaged was not allowing for the due diligence and analysis of the implications of such transactions. Tax legislation relating to the transfer of assets is also not seen to be consistently conducive to this process. The focus of this thesis is taxation and a critical analysis of how the current tax legislation affects most of the transactions which usually form the basis of black economic empowerment. It is argued that tax policy is one of the fundamental instruments available to government to encourage the process of black economic empowerment. It is therefore important to assess whether or not current tax legislation is supportive of the process of black economic empowerment and to suggest ways in which it can be amended to serve this purpose. By means of a literature review and a case study of a Black Economic Empowerment deal in the financial sector, the thesis examines various sections of the Income Tax Act, 58 of 1962, which may have a bearing on black economic empowerment transactions and structures, including corporate restructuring rules, the taxation of trusts, inter-company loans, the use of hybrid financial instruments, the taxation of small business corporations, employee share incentive schemes, connected persons rules and value-shifting arrangements, the general deduction formula and the deductibility of interest incurred on amounts raised to acquire shares. It appears that although some aspects of the current tax legislation lend themselves to assisting black economic empowerment transactions, there are still areas where much improvement is required. , KMBT_363
- Full Text:
- Date Issued: 2006
Mores, fault and fides: are these acceptable criteria when income tax deductions are claimed
- Authors: Swanepoel, Marius G
- Date: 2007
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:889 , http://hdl.handle.net/10962/d1001643
- Description: The two “pillars” on which taxable income is based are the definition of “gross income” in section 1 of the Income Tax Act, 58 of 1962, and the “general deduction formula” comprising the preamble to section 11, section 11(a) and section 23(g) of the Act. Many of the terms used in these sections are not defined in the Income Tax Act. Case law in relation to these sections reveals that morality issues, the negligence of taxpayers and the good faith of taxpayers have from time to time been treated as relevant considerations by the courts, both abroad and in South Africa, in allowing or disallowing deductions from the gross income of taxpayers. In some instances this occurred apparently unwittingly. In other instances, earlier decisions were followed without a thorough consideration of the correctness of the underlying reasoning or of the criteria which were applied in the earlier decisions. In relation to the definition of “gross income”, however, fides, mores and fault have not been a consideration. In CIR v Delagoa Bay Cigarette Co Ltd 1918 TPD 391 Bristowe, J stated: “I do not think it is material for the purpose of this case whether the business carried on by the company is legal or illegal.” There were a number of cases heard in relation to income from illegal activities (for example, COT v G, 1981 (4) SA 167 (ZA), 43 SATC 159, and ITC 291, 7 SATC 335, which related to the misappropriation of funds, ITC 1545, 54 SATC 464, which dealt with the proceeds of the sale of stolen diamonds and ITC 1624, 59 SATC 373, which dealt with overcharging customers). In these cases, the question turned on whether or not the amounts were received by the taxpayers for their own benefit and therefore to be included in gross income, or whether the taxpayers incurred a concomitant liability to repay the amounts, and did not involve the question of fides, mores or fault. The research concludes that, providing an even-handed approach is applied to both income and expense considerations, fides and mores may continue to play a role as a useful yardstick in this context. However, that fault, particularly the causal negligence of taxpayers in the process of sustaining a loss or incurring expenditure whilst conducting their income generating operations, has effectively been jettisoned as an irrelevant consideration, is a salutary development which has contributed to legal certainty.
- Full Text:
- Date Issued: 2007
- Authors: Swanepoel, Marius G
- Date: 2007
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:889 , http://hdl.handle.net/10962/d1001643
- Description: The two “pillars” on which taxable income is based are the definition of “gross income” in section 1 of the Income Tax Act, 58 of 1962, and the “general deduction formula” comprising the preamble to section 11, section 11(a) and section 23(g) of the Act. Many of the terms used in these sections are not defined in the Income Tax Act. Case law in relation to these sections reveals that morality issues, the negligence of taxpayers and the good faith of taxpayers have from time to time been treated as relevant considerations by the courts, both abroad and in South Africa, in allowing or disallowing deductions from the gross income of taxpayers. In some instances this occurred apparently unwittingly. In other instances, earlier decisions were followed without a thorough consideration of the correctness of the underlying reasoning or of the criteria which were applied in the earlier decisions. In relation to the definition of “gross income”, however, fides, mores and fault have not been a consideration. In CIR v Delagoa Bay Cigarette Co Ltd 1918 TPD 391 Bristowe, J stated: “I do not think it is material for the purpose of this case whether the business carried on by the company is legal or illegal.” There were a number of cases heard in relation to income from illegal activities (for example, COT v G, 1981 (4) SA 167 (ZA), 43 SATC 159, and ITC 291, 7 SATC 335, which related to the misappropriation of funds, ITC 1545, 54 SATC 464, which dealt with the proceeds of the sale of stolen diamonds and ITC 1624, 59 SATC 373, which dealt with overcharging customers). In these cases, the question turned on whether or not the amounts were received by the taxpayers for their own benefit and therefore to be included in gross income, or whether the taxpayers incurred a concomitant liability to repay the amounts, and did not involve the question of fides, mores or fault. The research concludes that, providing an even-handed approach is applied to both income and expense considerations, fides and mores may continue to play a role as a useful yardstick in this context. However, that fault, particularly the causal negligence of taxpayers in the process of sustaining a loss or incurring expenditure whilst conducting their income generating operations, has effectively been jettisoned as an irrelevant consideration, is a salutary development which has contributed to legal certainty.
- Full Text:
- Date Issued: 2007
The continued viability of the discretionary Inter vivos trust as an instrument for estate planning
- Lötter, Therésilda Sieglinde
- Authors: Lötter, Therésilda Sieglinde
- Date: 2007
- Subjects: Taxation -- Law and legislation -- South Africa , Trusts and trustees -- South Africa , Trusts and trustees -- Taxation -- South Africa , Estate planning -- South Africa , Estates (Law) -- South Africa
- Language: Afrikaans
- Type: Thesis , Masters , MCom
- Identifier: vital:900 , http://hdl.handle.net/10962/d1006148 , Taxation -- Law and legislation -- South Africa , Trusts and trustees -- South Africa , Trusts and trustees -- Taxation -- South Africa , Estate planning -- South Africa , Estates (Law) -- South Africa
- Description: The purpose of this study is to determine whether a discretionary inter vivos trust is still an effective instrument for estate planning. The process of estate planning, the role the trust plays in it and the background to the trust are described. The taxability and tax saving opportunities when the trust are utilised are discussed in the light of the Estate Duty Act, 45 of 1955, the Income Tax Act, 58 of 1962 (including the Eighth Schedule thereof) and the Transfer Duty Act, 40 of 1949. The opinions of tax and legal authorities in articles and relevant case law are also discussed. The impact of the "letter of wishes" on the stipulations of the trust deed is examined. Amendments to the Income Tax Act have placed a limit on the use of a trust for estate planning through a number of anti-avoidance measures, the introduction of a capital gains tax (in the Eighth Schedule) and the imposition of a high tax rate. The increase in the deduction granted in arriving at the dutiable amount of an estate, in terms of section 4A of the Estate Duty Act, from R1 500 000 to R2 500 000 has imposed a further limit on the use of the trust as an instrument in estate planning. The research demonstrates that, notwithstanding the amendments to the Income Tax Act, the trust still is a viable instrument, mainly because the trust operates as a conduit and because of its potential use in dividing taxable income amongst a number of beneficiaries. The stipulations included in the trust deed and the "letter of wishes" (if one exists), must be thought through carefully when estate planning is done, as it can give rise to the application of the general and specific anti-avoidance provisions as included in sections 7 and 103 of this Act. The research also concludes that, in assessing the effectiveness of the trust as an instrument in tax planning, the disadvantage of paying the higher transfer duty when the immovable asset is transferred to the trust should be weighed up against the possible saving in income tax and estate duty at a later stage. It is also clear that most assets owned by the trust are tax neutral, whilst many of the amendments under discussion deal with the taxability of trust income. The quantitative considerations underlying the use of the trust as part of the estate plan, remain unchanged. The research concludes by providing a framework of quantitative and qualitative criteria that can be used by an estate planner to determine whether it will be advantageous to transfer an asset to the trust to achieve the objectives of the estate plan.
- Full Text:
- Date Issued: 2007
- Authors: Lötter, Therésilda Sieglinde
- Date: 2007
- Subjects: Taxation -- Law and legislation -- South Africa , Trusts and trustees -- South Africa , Trusts and trustees -- Taxation -- South Africa , Estate planning -- South Africa , Estates (Law) -- South Africa
- Language: Afrikaans
- Type: Thesis , Masters , MCom
- Identifier: vital:900 , http://hdl.handle.net/10962/d1006148 , Taxation -- Law and legislation -- South Africa , Trusts and trustees -- South Africa , Trusts and trustees -- Taxation -- South Africa , Estate planning -- South Africa , Estates (Law) -- South Africa
- Description: The purpose of this study is to determine whether a discretionary inter vivos trust is still an effective instrument for estate planning. The process of estate planning, the role the trust plays in it and the background to the trust are described. The taxability and tax saving opportunities when the trust are utilised are discussed in the light of the Estate Duty Act, 45 of 1955, the Income Tax Act, 58 of 1962 (including the Eighth Schedule thereof) and the Transfer Duty Act, 40 of 1949. The opinions of tax and legal authorities in articles and relevant case law are also discussed. The impact of the "letter of wishes" on the stipulations of the trust deed is examined. Amendments to the Income Tax Act have placed a limit on the use of a trust for estate planning through a number of anti-avoidance measures, the introduction of a capital gains tax (in the Eighth Schedule) and the imposition of a high tax rate. The increase in the deduction granted in arriving at the dutiable amount of an estate, in terms of section 4A of the Estate Duty Act, from R1 500 000 to R2 500 000 has imposed a further limit on the use of the trust as an instrument in estate planning. The research demonstrates that, notwithstanding the amendments to the Income Tax Act, the trust still is a viable instrument, mainly because the trust operates as a conduit and because of its potential use in dividing taxable income amongst a number of beneficiaries. The stipulations included in the trust deed and the "letter of wishes" (if one exists), must be thought through carefully when estate planning is done, as it can give rise to the application of the general and specific anti-avoidance provisions as included in sections 7 and 103 of this Act. The research also concludes that, in assessing the effectiveness of the trust as an instrument in tax planning, the disadvantage of paying the higher transfer duty when the immovable asset is transferred to the trust should be weighed up against the possible saving in income tax and estate duty at a later stage. It is also clear that most assets owned by the trust are tax neutral, whilst many of the amendments under discussion deal with the taxability of trust income. The quantitative considerations underlying the use of the trust as part of the estate plan, remain unchanged. The research concludes by providing a framework of quantitative and qualitative criteria that can be used by an estate planner to determine whether it will be advantageous to transfer an asset to the trust to achieve the objectives of the estate plan.
- Full Text:
- Date Issued: 2007
A comparison between the South African "source rules" in relation to income tax and the "permanent establishment rules" as contained in double taxation agreements
- Authors: Fourie, Leonie
- Date: 2008
- Subjects: Income tax -- South Africa , Income tax -- Law and legislation -- South Africa , Double taxation -- South Africa , Business enterprises -- Taxation -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:905 , http://hdl.handle.net/10962/d1008203
- Description: South Africa's right to tax the income of a non-resident is determined in terms of the South African "source rules" established by court decisions in relation to the imposition of tax in terms of the Income Tax Act. Unless a non-resident's income is captured by the South African "source rules" (on the basis that hi slits income is derived from a South African source), South Africa would have no right to tax such income, even if such non-resident creates a permanent establishment in South Africa by performing business activities within South Africa which could be considered essential (but not dominant) in nature. In such scenario the activities performed by the non-resident in South Africa may utilise the natural resources and the infrastructure of South Africa, but the South African fiscus would be deprived of the right to any tax revenues attributable to the income produced partly by such activities within South Africa. The South African "source rules" refer only to the main or dominant activities giving rise to the income for the purpose of determining the source of such income (and accordingly the right to tax such income). On the other hand, the "permanent establishment rules" as set out under the Organisation for Economic Cooperation and Development Model Tax Convention on Income and on Capital refer to all the taxpayer's essential business activities for the purpose of determining whether or not such activities create a pennanent establishment. The result of the narrow nature of the South African "source rules" is that, under certain circumstances, the South African fiscus would not necessarily be granted the right to tax all income produced partly within South Africa. The research demonstrated that incorporating the principles underlying the "pennanent establishment rules" into South African legislation would be a reasonable and logical solution to the problem of detennining the source of income. In so doing, the South African "source rules" would determine the source of income, and consequently South Africa's taxing rights, with reference to the essential business activities giving rise to such income. In such case South Africa would be afforded the right to tax the income of a non-resident in the event that it performs any of its essential business activities within South Africa, albeit not the dominant or main activities giving rise to the income.
- Full Text:
- Date Issued: 2008
- Authors: Fourie, Leonie
- Date: 2008
- Subjects: Income tax -- South Africa , Income tax -- Law and legislation -- South Africa , Double taxation -- South Africa , Business enterprises -- Taxation -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:905 , http://hdl.handle.net/10962/d1008203
- Description: South Africa's right to tax the income of a non-resident is determined in terms of the South African "source rules" established by court decisions in relation to the imposition of tax in terms of the Income Tax Act. Unless a non-resident's income is captured by the South African "source rules" (on the basis that hi slits income is derived from a South African source), South Africa would have no right to tax such income, even if such non-resident creates a permanent establishment in South Africa by performing business activities within South Africa which could be considered essential (but not dominant) in nature. In such scenario the activities performed by the non-resident in South Africa may utilise the natural resources and the infrastructure of South Africa, but the South African fiscus would be deprived of the right to any tax revenues attributable to the income produced partly by such activities within South Africa. The South African "source rules" refer only to the main or dominant activities giving rise to the income for the purpose of determining the source of such income (and accordingly the right to tax such income). On the other hand, the "permanent establishment rules" as set out under the Organisation for Economic Cooperation and Development Model Tax Convention on Income and on Capital refer to all the taxpayer's essential business activities for the purpose of determining whether or not such activities create a pennanent establishment. The result of the narrow nature of the South African "source rules" is that, under certain circumstances, the South African fiscus would not necessarily be granted the right to tax all income produced partly within South Africa. The research demonstrated that incorporating the principles underlying the "pennanent establishment rules" into South African legislation would be a reasonable and logical solution to the problem of detennining the source of income. In so doing, the South African "source rules" would determine the source of income, and consequently South Africa's taxing rights, with reference to the essential business activities giving rise to such income. In such case South Africa would be afforded the right to tax the income of a non-resident in the event that it performs any of its essential business activities within South Africa, albeit not the dominant or main activities giving rise to the income.
- Full Text:
- Date Issued: 2008
The distinction between tax evasion, tax avoidance and tax planning
- Authors: Tarrant, Greg
- Date: 2008
- Subjects: South African Revenue Service , Tax evasion -- South Africa , Tax planning -- South Africa , Income tax -- South Africa , Income tax -- Law and legislation -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:897 , http://hdl.handle.net/10962/d1004549
- Description: Tax avoidance has been the subject of intense scrutiny lately by both the South African Revenue Service ("the SARS") and the media. This attention stems largely from the recent withdrawal of section 103(1) together with the introduction of section 80A to 80L of the South African Income Tax Act. However, this attention is not limited to South Africa. Revenue authorities worldwide have focused on the task of challenging tax avoidance. The approach of the SARS to tackling tax avoidance has been multi-faceted. In the Discussion Paper on Tax Avoidance and Section 103 (1) of the South African Income Tax Act they begin with a review of the distinction between tax evasion, tax avoidance and tax planning. Following a call for comment the SARS issued an Interim Response followed by the Revised Proposals which culminated in the withdrawal of the longstanding general anti-avoidance rules housed in section 103(1) and the introduction of new and more comprehensive anti-avoidance rules. In addition, the SARS has adopted an ongoing media campaign stressing the importance of paying tax in a country with a large development agenda like that of South Africa, the need for taxpayers to adopt a responsible attitude to the management of tax and the inclusion of responsible tax management as the greatest measure of a taxpayer's corporate and social investment. In tandem with this message the SARS have sought to vilify those taxpayers who engage in tax avoidance. The message is clear: tax avoidance carries reputational risks; those who engage in tax avoidance are unpatriotic or immoral and their actions simply result in an unfair shifting of the tax burden. The SARS is not alone in the above approach. Around the world tax authorities have been echoing the same message. The message appears to be working. Accounting firms speak of a "creeping conservatism" that has pervaded company boardrooms. What is not clear, however, is whether taxpayers, in becoming more conservative, are simply more fully aware of tax risks and are making informed decisions or whether they are simply responding to external events, such as the worldwide focus by revenue authorities and the media on tax avoidance. Whatever the reason, it is now critical, particularly in the case of corporate taxpayers, that their policies for tax and its attendant risks need to be as sophisticated, coherent and transparent as its policies in all other areas involving multiple stakeholders, such as suppliers, customers, staff and investors. How does a company begin to set its tax philosophy and strategic direction or to determine its appetite for risk? A starting point, it is submitted would be a review of the distinction between tax evasion, avoidance and planning with a heightened sensitivity to the unfamiliar ethical, moral and social risks. The goal of this thesis was to clearly define the distinction between tax evasion, tax avoidance and tax planning from a legal interpretive, ethical and historical perspective in order to develop a rudimentary framework for the responsible management of strategic tax decisions, in the light of the new South African general anti-avoidance legislation. The research methodology entails a qualitative research orientation consisting of a critical conceptual analysis of tax evasion and tax avoidance, with a view to establishing a basic framework to be used by taxpayers to make informed decisions on tax matters. The analysis of the distinction in this work culminated in a diagrammatic representation of the distinction between tax evasion, tax avoidance and tax planning emphasising the different types of tax avoidance from least aggressive to the most abusive and from the least objectionable to most objectionable. It is anticipated that a visual representation of the distinction, however flawed, would result in a far more pragmatic tool to taxpayers than a lengthy document. From a glance taxpayers can determine the following: That tax avoidance is legal; that different forms of tax avoidance exist, some forms being more aggressive than others; that aggressive forms of tax avoidance carry reputational risks; and that in certain circumstances aggressive tax avoidance schemes may border on tax evasion. This, it is envisaged, may prompt taxpayers to ask the right questions when faced with an external or in-house tax avoidance arrangement rather than simply blindly accepting or rejecting the arrangement.
- Full Text:
- Date Issued: 2008
- Authors: Tarrant, Greg
- Date: 2008
- Subjects: South African Revenue Service , Tax evasion -- South Africa , Tax planning -- South Africa , Income tax -- South Africa , Income tax -- Law and legislation -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:897 , http://hdl.handle.net/10962/d1004549
- Description: Tax avoidance has been the subject of intense scrutiny lately by both the South African Revenue Service ("the SARS") and the media. This attention stems largely from the recent withdrawal of section 103(1) together with the introduction of section 80A to 80L of the South African Income Tax Act. However, this attention is not limited to South Africa. Revenue authorities worldwide have focused on the task of challenging tax avoidance. The approach of the SARS to tackling tax avoidance has been multi-faceted. In the Discussion Paper on Tax Avoidance and Section 103 (1) of the South African Income Tax Act they begin with a review of the distinction between tax evasion, tax avoidance and tax planning. Following a call for comment the SARS issued an Interim Response followed by the Revised Proposals which culminated in the withdrawal of the longstanding general anti-avoidance rules housed in section 103(1) and the introduction of new and more comprehensive anti-avoidance rules. In addition, the SARS has adopted an ongoing media campaign stressing the importance of paying tax in a country with a large development agenda like that of South Africa, the need for taxpayers to adopt a responsible attitude to the management of tax and the inclusion of responsible tax management as the greatest measure of a taxpayer's corporate and social investment. In tandem with this message the SARS have sought to vilify those taxpayers who engage in tax avoidance. The message is clear: tax avoidance carries reputational risks; those who engage in tax avoidance are unpatriotic or immoral and their actions simply result in an unfair shifting of the tax burden. The SARS is not alone in the above approach. Around the world tax authorities have been echoing the same message. The message appears to be working. Accounting firms speak of a "creeping conservatism" that has pervaded company boardrooms. What is not clear, however, is whether taxpayers, in becoming more conservative, are simply more fully aware of tax risks and are making informed decisions or whether they are simply responding to external events, such as the worldwide focus by revenue authorities and the media on tax avoidance. Whatever the reason, it is now critical, particularly in the case of corporate taxpayers, that their policies for tax and its attendant risks need to be as sophisticated, coherent and transparent as its policies in all other areas involving multiple stakeholders, such as suppliers, customers, staff and investors. How does a company begin to set its tax philosophy and strategic direction or to determine its appetite for risk? A starting point, it is submitted would be a review of the distinction between tax evasion, avoidance and planning with a heightened sensitivity to the unfamiliar ethical, moral and social risks. The goal of this thesis was to clearly define the distinction between tax evasion, tax avoidance and tax planning from a legal interpretive, ethical and historical perspective in order to develop a rudimentary framework for the responsible management of strategic tax decisions, in the light of the new South African general anti-avoidance legislation. The research methodology entails a qualitative research orientation consisting of a critical conceptual analysis of tax evasion and tax avoidance, with a view to establishing a basic framework to be used by taxpayers to make informed decisions on tax matters. The analysis of the distinction in this work culminated in a diagrammatic representation of the distinction between tax evasion, tax avoidance and tax planning emphasising the different types of tax avoidance from least aggressive to the most abusive and from the least objectionable to most objectionable. It is anticipated that a visual representation of the distinction, however flawed, would result in a far more pragmatic tool to taxpayers than a lengthy document. From a glance taxpayers can determine the following: That tax avoidance is legal; that different forms of tax avoidance exist, some forms being more aggressive than others; that aggressive forms of tax avoidance carry reputational risks; and that in certain circumstances aggressive tax avoidance schemes may border on tax evasion. This, it is envisaged, may prompt taxpayers to ask the right questions when faced with an external or in-house tax avoidance arrangement rather than simply blindly accepting or rejecting the arrangement.
- Full Text:
- Date Issued: 2008
The tax implications of non-resident sportspersons performing and earning an income in South Africa
- Authors: Wessels, Jacques
- Date: 2008
- Subjects: South African Revenue Service , Sports -- Taxation -- Law and legislation -- South Africa , Taxation -- Law and legislation -- South Africa , Income tax -- Law and legislation -- South Africa , Income tax -- Foreign income , Income tax -- South Africa -- Foreign income , Withholding tax -- Law and legislation -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:893 , http://hdl.handle.net/10962/d1003719 , South African Revenue Service , Sports -- Taxation -- Law and legislation -- South Africa , Taxation -- Law and legislation -- South Africa , Income tax -- Law and legislation -- South Africa , Income tax -- Foreign income , Income tax -- South Africa -- Foreign income , Withholding tax -- Law and legislation -- South Africa
- Description: As the number of non-resident sports persons competing in South Africa increases so does the need to tax them more effectively. It was for this reason that the South African legislature decided to insert Part IlIA into the Income Tax Act which regulates the taxation of non-resident sports persons in South Africa. The new tax on foreign sports persons, which came into effect during August 2006, is a withholding tax placing the onus upon the organizer of the event to withhold the tax portion of the payment to the non-resident sportsperson and pay it over to the revenue services. The rate of taxation has been set at 15 percent on all amounts received by or accruing to a foreign sportsperson. The question which the research addressed is whether this new tax will prove to be an effective tax, both from the point of view of its equity and the administration of the tax. In order to determine the impact of the new tax, it was compared to similar taxes implemented in the United Kingdom and Australia and also to other withholding taxes levied in South Africa. The new tax was also measured against a theoretical model for effectiveness, compared to the pre-August 2006 situation and to the taxation of resident sportsmen and women, using hypothetical examples. The major shortcomings of the new withholding tax are the uncertainty with regard to the intention of the legislature on matters such as the taxation of capital income versus revenue income, the question whether payments to support staff are included in the ambit of the new tax, the taxation of the award of assets in lieu of cash payments and the definition of a resident. A further area of concern is that the rate of taxation of 15 percent appears to be too low and creates horizontal inequity between the taxation of resident and non-resident sports persons. The new tax on non-resident sports persons may have its shortcomings but, depending upon the administrative and support structures put in place to deal with it, will be an effective tax. The rate at which the tax is levied could result in a less tax being collected than before but, with the reduced administrative cost of tax collection, the effective/statutory ratio of the tax could well be much higher than it was. This is a new tax in South Africa and certain initial problems are inevitable and will undoubtedly be solved as the administrators gain experience and as the case law governing this tax develops. , KMBT_363
- Full Text:
- Date Issued: 2008
- Authors: Wessels, Jacques
- Date: 2008
- Subjects: South African Revenue Service , Sports -- Taxation -- Law and legislation -- South Africa , Taxation -- Law and legislation -- South Africa , Income tax -- Law and legislation -- South Africa , Income tax -- Foreign income , Income tax -- South Africa -- Foreign income , Withholding tax -- Law and legislation -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:893 , http://hdl.handle.net/10962/d1003719 , South African Revenue Service , Sports -- Taxation -- Law and legislation -- South Africa , Taxation -- Law and legislation -- South Africa , Income tax -- Law and legislation -- South Africa , Income tax -- Foreign income , Income tax -- South Africa -- Foreign income , Withholding tax -- Law and legislation -- South Africa
- Description: As the number of non-resident sports persons competing in South Africa increases so does the need to tax them more effectively. It was for this reason that the South African legislature decided to insert Part IlIA into the Income Tax Act which regulates the taxation of non-resident sports persons in South Africa. The new tax on foreign sports persons, which came into effect during August 2006, is a withholding tax placing the onus upon the organizer of the event to withhold the tax portion of the payment to the non-resident sportsperson and pay it over to the revenue services. The rate of taxation has been set at 15 percent on all amounts received by or accruing to a foreign sportsperson. The question which the research addressed is whether this new tax will prove to be an effective tax, both from the point of view of its equity and the administration of the tax. In order to determine the impact of the new tax, it was compared to similar taxes implemented in the United Kingdom and Australia and also to other withholding taxes levied in South Africa. The new tax was also measured against a theoretical model for effectiveness, compared to the pre-August 2006 situation and to the taxation of resident sportsmen and women, using hypothetical examples. The major shortcomings of the new withholding tax are the uncertainty with regard to the intention of the legislature on matters such as the taxation of capital income versus revenue income, the question whether payments to support staff are included in the ambit of the new tax, the taxation of the award of assets in lieu of cash payments and the definition of a resident. A further area of concern is that the rate of taxation of 15 percent appears to be too low and creates horizontal inequity between the taxation of resident and non-resident sports persons. The new tax on non-resident sports persons may have its shortcomings but, depending upon the administrative and support structures put in place to deal with it, will be an effective tax. The rate at which the tax is levied could result in a less tax being collected than before but, with the reduced administrative cost of tax collection, the effective/statutory ratio of the tax could well be much higher than it was. This is a new tax in South Africa and certain initial problems are inevitable and will undoubtedly be solved as the administrators gain experience and as the case law governing this tax develops. , KMBT_363
- Full Text:
- Date Issued: 2008
Gains derived from illegal activities :an analysis of the taxation consequences
- Mtshawulana, Lungiswa Bukeka
- Authors: Mtshawulana, Lungiswa Bukeka
- Date: 2009
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:886 , http://hdl.handle.net/10962/d1001640
- Description: Income Tax in South Africa is levied in terms of the Income Tax Act 58 of 1962 on taxable income, which, by definition, is arrived at by deducting from "gross income" receipts and accruals that are exempt from tax as well as deductions and allowances provided for in the Act. The Income Tax Act provides no guidance with regard to the taxation of illegal activities, except to prohibit the deduction of expenditure incurred in paying fines or in relation to corrupt activities, as defined. An analysis of the taxation of income derived from theft, fraud and prostitution and the deductibility of expenses relating to that income, is the question addressed in this thesis. In this thesis, an analysis was made of relevant case law in relation to the provisions of the Income Tax Act in an attempt to provide clarity. A brief comparison was also macie of American, United Kingdom and South African tax law. Similarities were found between the American, United Kingdom and South African tax regimes in relation to the taxation of income, but there appeared to be more certainty in America and the United Kingdom in relation to the deduction of expenses. The thesis concludes that recent case decisions have provided certainty in relation to income from illegal activities, but the tax status of the deduction of expenses remains uncertain.
- Full Text:
- Date Issued: 2009
- Authors: Mtshawulana, Lungiswa Bukeka
- Date: 2009
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:886 , http://hdl.handle.net/10962/d1001640
- Description: Income Tax in South Africa is levied in terms of the Income Tax Act 58 of 1962 on taxable income, which, by definition, is arrived at by deducting from "gross income" receipts and accruals that are exempt from tax as well as deductions and allowances provided for in the Act. The Income Tax Act provides no guidance with regard to the taxation of illegal activities, except to prohibit the deduction of expenditure incurred in paying fines or in relation to corrupt activities, as defined. An analysis of the taxation of income derived from theft, fraud and prostitution and the deductibility of expenses relating to that income, is the question addressed in this thesis. In this thesis, an analysis was made of relevant case law in relation to the provisions of the Income Tax Act in an attempt to provide clarity. A brief comparison was also macie of American, United Kingdom and South African tax law. Similarities were found between the American, United Kingdom and South African tax regimes in relation to the taxation of income, but there appeared to be more certainty in America and the United Kingdom in relation to the deduction of expenses. The thesis concludes that recent case decisions have provided certainty in relation to income from illegal activities, but the tax status of the deduction of expenses remains uncertain.
- Full Text:
- Date Issued: 2009
An investigation into international transfer pricing guidelines and the anomalies arising from business restructurings by multi-national enterprises
- Authors: Stelloh, Marcus Matthias
- Date: 2011
- Language: English
- Type: text , Thesis , Masters , MCom
- Identifier: vital:879 , http://hdl.handle.net/10962/d1001633
- Description: The number of multinational enterprises has increased substantially. In part due to the integration of national economies (the European Union), improvements in communication and technology and the opportunity to reduce costs as a result of globalisation. Transfer pricing and especially business restructuring within multinationals is a fairly new concept.Professional legal and audit firms have different views on how to approach business restructurings. This research analyses important transfer pricing aspects and the anomalies that arise through business restructurings. The research method used in this research paper is primarily qualitative, comprising the analysis of various documentary sources of data. Relevant South African and international case law, tax legislation, the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations, the Transfer Pricing Aspects of Business Restructurings Discussion Draft and other reports were consulted and analysed. Further the views of recognised legal and tax experts that have been published in technical journals and text books were also considered and examined. A hypothetical example of a business restructuring transaction was constructed in order to illustrate practical issues and different approaches to solving them. The research has argued that the arm’s length principle, which forms the bases of transfer pricing regulation, is not an exact science but theoretically it is the most suitable measure.It may not be able to incorporate all variables, such as the cost savings through synergies of multinational enterprises, but it promotes international trade and investment by ensuring that transactions are based on fair prices. Business restructurings create anomalies in applying the arm’s length principle but these anomalies can be dealt with within the regulatory structure. The business restructuring approach recommended is realistic and pragmatic, but more clarity may be needed in certain circumstances. The research has also discussed the avoidance of transfer pricing audits, including having appropriate transfer pricing policies and documentation.
- Full Text:
- Date Issued: 2011
- Authors: Stelloh, Marcus Matthias
- Date: 2011
- Language: English
- Type: text , Thesis , Masters , MCom
- Identifier: vital:879 , http://hdl.handle.net/10962/d1001633
- Description: The number of multinational enterprises has increased substantially. In part due to the integration of national economies (the European Union), improvements in communication and technology and the opportunity to reduce costs as a result of globalisation. Transfer pricing and especially business restructuring within multinationals is a fairly new concept.Professional legal and audit firms have different views on how to approach business restructurings. This research analyses important transfer pricing aspects and the anomalies that arise through business restructurings. The research method used in this research paper is primarily qualitative, comprising the analysis of various documentary sources of data. Relevant South African and international case law, tax legislation, the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations, the Transfer Pricing Aspects of Business Restructurings Discussion Draft and other reports were consulted and analysed. Further the views of recognised legal and tax experts that have been published in technical journals and text books were also considered and examined. A hypothetical example of a business restructuring transaction was constructed in order to illustrate practical issues and different approaches to solving them. The research has argued that the arm’s length principle, which forms the bases of transfer pricing regulation, is not an exact science but theoretically it is the most suitable measure.It may not be able to incorporate all variables, such as the cost savings through synergies of multinational enterprises, but it promotes international trade and investment by ensuring that transactions are based on fair prices. Business restructurings create anomalies in applying the arm’s length principle but these anomalies can be dealt with within the regulatory structure. The business restructuring approach recommended is realistic and pragmatic, but more clarity may be needed in certain circumstances. The research has also discussed the avoidance of transfer pricing audits, including having appropriate transfer pricing policies and documentation.
- Full Text:
- Date Issued: 2011
Extending legal professional privilege to non-legal tax practitioners in South Africa: a comparative and constitutional perspective
- Authors: Jani, Pride
- Date: 2011
- Language: English
- Type: text , Thesis , Masters , MCom
- Identifier: vital:882 , http://hdl.handle.net/10962/d1001636
- Description: This study explains the differing rights of taxpayers, based on the nature of the profession of the tax adviser they consult. Those who utilize the services of tax attorneys can rely on the protection afforded by legal professional privilege whereas those who obtain their advice from non-legal advisers, such as accountants and other tax advisers, cannot claim the same protection. Legal professional privilege is a substantive right which should be extended to cover clients of non-legal tax advisers. The continued denial of the privilege to clients of nonlegal tax practitioners while it is availed to those who approach legal practitioners infringes the rights to privacy and equality contained in the South African Constitution. The object of this research is to show that the common law concept of legal professional privilege is amenable to extension so as to cover the clients of non-legal tax advisers. A qualitative approach was adopted which involved an in-depth analysis of the origins, rationale as well as the requirements for the operation of the doctrine. This also involved a constitutional as well as a comparative dimension. The constitutional dimension sought to show that the current distinction is untenable under the South African Constitution by virtue of the infringement of the rights to privacy and equality. The comparative dimension presented an analysis of the various jurisdictions that have extended the doctrine as well as those that are still to do so or have adamantly rejected the idea. The differential treatment of taxpayers based on the professional they engage contravenes the privacy and equality provisions and is thus unconstitutional. The study demonstrates that legal professional privilege is amenable to extension and there is need for legislative intervention as the courts are limited in the extent to which they may intervene in light of the separation of powers and judicial deference. Legal professional privilege should therefore be extended to protect the clients of non-legal tax advisers as opposed to partial protection which subsists at the moment.
- Full Text:
- Date Issued: 2011
- Authors: Jani, Pride
- Date: 2011
- Language: English
- Type: text , Thesis , Masters , MCom
- Identifier: vital:882 , http://hdl.handle.net/10962/d1001636
- Description: This study explains the differing rights of taxpayers, based on the nature of the profession of the tax adviser they consult. Those who utilize the services of tax attorneys can rely on the protection afforded by legal professional privilege whereas those who obtain their advice from non-legal advisers, such as accountants and other tax advisers, cannot claim the same protection. Legal professional privilege is a substantive right which should be extended to cover clients of non-legal tax advisers. The continued denial of the privilege to clients of nonlegal tax practitioners while it is availed to those who approach legal practitioners infringes the rights to privacy and equality contained in the South African Constitution. The object of this research is to show that the common law concept of legal professional privilege is amenable to extension so as to cover the clients of non-legal tax advisers. A qualitative approach was adopted which involved an in-depth analysis of the origins, rationale as well as the requirements for the operation of the doctrine. This also involved a constitutional as well as a comparative dimension. The constitutional dimension sought to show that the current distinction is untenable under the South African Constitution by virtue of the infringement of the rights to privacy and equality. The comparative dimension presented an analysis of the various jurisdictions that have extended the doctrine as well as those that are still to do so or have adamantly rejected the idea. The differential treatment of taxpayers based on the professional they engage contravenes the privacy and equality provisions and is thus unconstitutional. The study demonstrates that legal professional privilege is amenable to extension and there is need for legislative intervention as the courts are limited in the extent to which they may intervene in light of the separation of powers and judicial deference. Legal professional privilege should therefore be extended to protect the clients of non-legal tax advisers as opposed to partial protection which subsists at the moment.
- Full Text:
- Date Issued: 2011