ENS Tax In Brief

case law

• Tholo Energy Services CC v Commissioner for the South African Revenue Service (378/2023) [2024] ZASCA 120 (6 August 2024)
  • The Supreme Court of Appeal ("SCA") dismissed an appeal by Tholo Energy Services CC ("TES") under section 47(9)(e) of the Customs and Excise Act 91 of 1964 ("Customs and Excise Act").
  • TES, a licensed distributor of fuel, sought refunds for diesel exported to Lesotho, but the Commissioner of SARS disallowed the claims because the fuel was not obtained from a licensed customs warehouse and was not transported by a licensed remover of goods.
  • The SCA:
    • agreed with the High Court's decision, which had upheld the Commissioner's refusal of the refund claims on the grounds that TES did not meet the necessary legal requirements therefor; and
    • held that an appeal under section 47(9)(e) of the Customs and Excise Act involves a complete rehearing of the matter, allowing the High Court to decide the appeal on additional grounds presented by the Commissioner.
  • The appeal was dismissed with costs, including the costs of two counsel.
  • Find the judgment here.

legislation and draft legislation

• Revised draft Revenue Laws Amendment Bill, 2024 ("RLAB") and Explanatory Memorandum | Published for comment
  • As outlined in the media statement on the 2024 RLAB published for comment on 21 February 2024 and public workshops held on 6 June 2024, National Treasury and SARS invited a second round of written comments on the revised 2024 draft RLAB that were due on 16 August 2024.
  • Find the revised draft RLAB here and the draft Explanatory Memorandum here.
• GG 51001 Notice 5086 | Exemption in terms of section 12P(2) of amounts credited from National Revenue Fund to South African Reserve Bank for Contingency Reserve Requirements
  • Find the Notice, which will apply retrospectively from 1 July 2024, here.

tax rulings

• Binding Class Ruling ("BCR") 090 | Award of listed shares under a share incentive scheme
  • This BCR determines the income tax and securities transfer tax consequences for employer companies of a proposed share incentive scheme.
  • Find the BCR here.
• Binding Private Ruling ("BPR") 407 | Generation and supply of renewable energy
  • This BPR determines the deductibility of expenditure to be incurred by a company installing photovoltaic solar energy plants on a lessors' premises to be used by the Applicant to supply solar electricity to companies within the same group of companies as the Applicant in terms of power purchase agreements (PPAs).
  • Find the BPR here.
• BPR 408 | Corporate restructurings using section 42 of the ITA
  • This BPR determines the tax consequences of a corporate restructuring involving the disposal of shares in terms of section 42 of the ITA.
  • Find the BPR here.
• BPR 409 | Acquisition by a public benefit organisation of forfeited share incentive scheme shares
  • This BPR determines the income tax and securities transfer tax consequences for a public benefit organisation acquiring forfeited share incentive scheme shares.
  • Find the BPR here

SARS publications

• Updated Guide re Contribution Deductions in respect of the amendment to section 11F(2)(a) of the Income Tax Act, 58 of 1962 ("ITA")
  • Where a person's year of assessment is less than 12 months, the maximum amount of the allowable retirement fund contribution deduction may not exceed the prescribed limit (currently R350 000) for all years of assessment within the 12-month period from 1 March of that calendar year to the last day of February in the following year.
  • The formula to determine the allowable retirement fund contributions is set out in Section 11F of the ITA.
  • Find the Updated Guide here.
• Legal Counsel | Interpretation and Rulings
  • Interpretation Note 98 (issue 2) ("IN98") | Public benefit organisations: The provision of funds, assets or other resources to any association of persons.
    • IN98 provides guidance on a conduit PBO carrying on a PBA in Part I; the requirement imposed under section 30(3)(f) on a conduit PBO providing funds to an association of persons contemplated in PBA 10(iii) in Part I and; the meaning of "association of persons" contemplated in Part I.
    • Find IN98 here.
  • Interpretation Note 133 ("IN133") – Income tax exemption: Water services provider.
    • IN133 provides guidance on the interpretation and application of the definition of "water services provider" in section 1(1) for purposes of the exemption of the receipts and accruals of a qualifying water services provider from normal tax under section 10(1)(t)(ix).
    • Find IN133 here.
• Updated e@syFile" Employer BETA release
  • The trade testing will be available from 19 August to 30 August 2024.
  • The formal release date is 16 September 2024.
  • The BETA version of the current e@syFile" will contain the following changes:
    • New source code for the saving withdrawal benefit for the two-pot system; and
    • Minor amendments to source code validations.
  • Find more information here and here.
• Third Party Data reporting – Medical Aid Trade Testing commences from 19 August until 13 September 2024.
  • Find more information here.

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