What a wild ride the last few weeks have been.

Tax issues

Greylisting update

At the June plenary session, the FATF has confirmed that South Africa has substantially completed all of the actions required. The next steps would be an on site inspection to assess the continued implementation and political will to keep these actions going.

It seems we are on track to be removed from the list by the end of the year.

Exchange Control updates

There were a number of circulars released, with some exciting changes.

Circular 9:

• Historically, any cash not utilised on a trip, coming from the travel allowance was required to be converted back into Rands. These amounts may now be banked into the travellers foreign currency bank account held with a local institution.

Circular 10:

• Agricultural commodity producers are now entitled to enter into hedging contracts.

Circular 12:

• Individuals can now have a foreign currency bank account with a local bank. Any cash moved into these accounts should be treated the same as a foreign investment.
• The regulations were also updated to reflect the SARS TCS pin process.
• No South African resident can make a transfer abroad without a tax number.
• South African tax residents can now facilitate offshore investments through offshore trusts.

Circular 13:

• In year of change in residency, individuals can claim a travel allowance of R1million.
• Shares can be externalised (both listed and unlisted) by individuals similar to cash.
• For individuals who ceased to be tax resident who no longer have an active SARS number need not, in the instance of inheritance or life insurance payouts, apply for a Manual Letter of Compliance as long as the amount to be paid is less than R10 million.

Odds and sods

• Updated IN 19 – Year of assessment of persons other than companies: Accounts accepted to a date other than the last day of February
• Updated IN 90 – Year of assessment of a company: Accounts accepted to a date other than the last day of a company’s financial year
• Guide to Advance Tax Rulings (Issue 2)
• Quick Reference Guide – ATR System

Tax Cases

There is a case that I would love to have included in this month’s newsletter, but the full judgement has not yet been published. It deals with whether SARS has the right to offset VAT refunds against other taxes due. Keep an eye out for the next Newsletter.