Oversteer vs. Understeer

 

A lot of car and racing experts often refer to vehicles as being ‘front or rear-wheel drive’, and while these terms seem quite self-explanatory, there are significant differences between them in terms of steering and control.

 

The basic difference between the two types can be explained as a difference between over and understeering. Understeering is an action seen in front wheel drive vehicles. Because these vehicles rely on the front end to both drive and maneuver the vehicle, it becomes more difficult for the wheels to perform both actions at once. In order to avoid understeering, the driver should take his or her foot off of the accelerator pedal to allow the turning mechanisms to take control around corners and shorten the turning arc.

 

Oversteering, on the other hand, happens in rear wheel drive vehicles. The rear wheels only move the car forward, and the front wheels only have to change the car's direction. Oversteering means that the arc is much tighter as the rear of the car tries to 'come around' to the front. Oversteering can be countered by applying more speed, and by turning the wheel in the opposite direction. Lifting off the accelerator during oversteering will cause a weight transfer to the front of the car, reducing grip at the rear, which is not good in a rear wheel drive car.

    

Types of Tax in South Africa

 

The South African tax system in South Africa has been subjected to a fair amount of public scrutiny in recent months due to various issues within the political framework of the country. It should also be noted that while the tax laws are applicable to all residents of South Africa, there is still a lot of confusion at a grassroots level about how it works. The following is a brief explanation of the types of tax applicable to South African residents and how they apply to certain persons:

 

Income tax

 

Income tax is imposed on a resident’s worldwide income, at the following rates:

 

Individuals and special trusts are taxed at graduated rates, up to a maximum of 40%, companies and corporations at 29%, and trusts and 40%.

 

Interest received by a non-resident is tax-exempt provided the individual is physically absent from South Africa for at least 183 days and does not carry on business in South Africa during the year of assessment. Interest received by or accrued to any company managed or controlled outside South Africa is tax-exempt unless such company carries on business in South Africa (such as branches of foreign companies). Dividends received by non-residents are tax-exempt. Royalties that are subject to Double Tax Agreements and paid to non-residents are subject to a final withholding tax of 12% (Residents require the approval of the Department of Trade and Industry and Exchange Control for payments of a royalty to a non-resident). Non-residents are taxed on South African source income.

 

Capital gains tax

 

Capital gains tax is imposed on a resident’s worldwide assets at the following maximum effective rates:

 

Individuals and special trusts at a rate of 10%, companies and corporations at 14.5% and trusts at 20%.

 

Generally, a primary residence up to a value of R1 million is excluded. The rate applicable to trusts may be reduced to that applicable to individuals by distributing capital gains to individual beneficiaries. Capital gains tax, triggered on disposal of an asset, applies to a non-resident’s immovable property or assets of a permanent establishment in South Africa.

 

Donations tax

 

Generally, donations tax is levied at a rate of 20% on the value of any property disposed gratuitously by a South African resident or domestic company or domestic corporation. Exemptions include donations by a natural person up to R30,000 per annum, property disposed of under and in pursuance of any trust, donations between spouses not separated, and donation of property or a right in property situated outside South Africa if acquired by the donor before becoming resident in South Africa for the first time, or by inheritance or donation from a non-resident.

 

Other

 

Estate duty is levied on estates at a rate of 20%. Exemptions include the first R1,500,000 of the estate and any bequest to a surviving spouse.

 

Secondary tax on companies and corporations is levied at a rate of 12.5% on dividends declared by a company or corporation.

 

 

By Wesley Geyer

Creative Writer at ATKA SA

Six Tips To Make Sure Your Tax Affairs Are In Order

As a taxpayer, even a simple error might lead to severe penalties. Your best option to prevent this from happening, is to clean up house. 

Take a look at  the following six steps – they are guaranteed to help you keep your name clear!



1. Have all the aspects of your tax affairs reviewed by a tax practitioner – this includes income tax, employee's tax, VAT, everything. This process will help you to see which areas are at risk and also show you the seriousness of it, which will help you decide whether you should consider voluntary disclosure to SARS.

 

2. It is imperative that you keep proper records and keep all the documents that you will need to hand in to SARS.  Don't be shy to spend money on this – going cheap might work out more expensive in the end.

 

3. Make sure you receive proper advice before taking a tax position.  When it is done, it cannot be reversed and you might not have made a properly informed decision.

 

4. Don't set your hopes too high.  Tax is hardly ever fair and SARS allows very few loopholes. Remember, if something sounds too good to be true, it usually is – even your tax position.

 

5. Don't try to cut corners by manipulating estimates and payments according to what you feel is fair. This might lead to possible investigations and payments and is definitely not worth it.

 

6. Make sure you use a tax practitioner that it compliant.  If their affairs aren't in order, chances are they won't put yours in order either.  You are still responsible for what you hand in to SARS, regardless of whether you make use of a tax practitioner.

 

Experience has proven that, no matter how hard you try, some errors might still happen.  It is important to note, though that taxpayers will no longer escape additional tax on their errors under the new TAA.  That is why the use of a tax practitioner is so strongly recommended as it helps the taxpayer limit these errors.

 

The new understatement penalty regime has swung the odds of collecting more tax revenues squarely in favour of SARS and taxpayers must be extra vigilant in their affairs. These measures might seem harsh, but there is value in remembering that SARS retains substantial powers when collecting debt that it is owed.

As the TAA is still very young, it will inevitably make amendments and additions, even while taxpayers and SARS still learn the full effect of the Act.

 

In the meantime, pay close attention to your affairs and don't bend the rules in any aspect of your tax life.

Deadline for Tax Advisers

Tax practitioners who complete tax returns for a fee or provide advice have until July 2013 to find a controlling body if they want to be recognized under the new Tax Administration Act. The Tax practitioner has to be registered with the South African Revenue Service (SARS) by 1 July this year, in terms of the act which came into effect in October 2012.

Those who do not register could face legal action.

This was implemented to shield the taxpayers from unprofessional conduct by the practitioners who could place their funds at a great risk.

There are new regulations to hold the tax practitioner liable for the advice he gives to the tax payer, and also to root out any unreliable practitioners. The regulations requires all tax practitioners to register with controlling bodies such as the Institute for Tax Practitioners (Sait), the South Africa Institute of Professional Accountants (Saica) and the Independent Regulatory Board of Auditors amongst others.

The act also allows the controlling bodies to take disciplinary action against the practitioners who fail to comply with the body’s rules.

The new legislation states that controlling bodies can now enforce minimum qualifications and continuing  educational requirements, ensuring that the public is no longer at the mercy of tax practitioners who are not up to date with the latest developments. Tax payers can now take pride in the fact that their tax advisers meet the minimum industry standard, and undertake in continual professional education and are now subject to a disciplinary code.

Unfortunately highly experienced practitioners may not be able to practice legally unless they comply with the regulations of a controlling body to which they are required to belong.

Saica welcomed the legislation saying that the tax profession should be regulated. “Saica was however not in favor of a statutory regulator that would regulate and provide services to tax practitioners” said Piet Nel, Saica’s project director for tax

An unregulated industry meant spending a great deal of time and energy to correct errors caused by unprofessional conduct of a significant number of tax practitioners, according to Adrian Lackay, SARS spokesperson.  

It is proposed that the regulation of tax practitioners be divided into two phases. The first phase will be the compulsory registration of tax practitioners with a recognized controlling body.



“The second phase will be the establishment of an independent regulatory board for tax practitioners." This will start with a review of the first phase 18 months after its implementation, said Lackay.

Little LogBook – FAQ #7

Who is the main client base for Little LogBook?

 

The Little LogBook GPS Trip Logger is suitable for use by just about anyone. Its purpose is to help users not only efficiently manage their trip data and mileage, but also allows them to create SARS-compliant logbooks for both private and business related purposes.

 

The Little LogBook GPS device is usable anywhere in the world, depending on the country edition purchased. As it uses state-of-the-art GPS tracking technology, the device will work effectively no matter where in the world it is. This allows you to manage your fleets and vehicles from anywhere in the world and use the device to keep track of all costs via the included software.

Little LogBook – FAQ #6

How do I erase data that is already on my device/How do I deal with errors?

 

Managing the data on your Little LogBook device is a simple procedure that is aided by the software provided upon purchase. Once you have used the device for any period of time, by simply connecting it to your PC or laptop and accessing the given software, you can save, copy and delete data from the device itself to make sure you have back-ups of it safely stored on your computer for future reference.

 

If you happen to encounter an error with the data that is stored on the device (i.e. the trip log that has been recorded is faulty due to poor connection with satellites, etc.), you can access those parts and directly delete the incorrect information to ensure that your logged information is as accurate as possible.

Little LogBook – FAQ #5

Why is it important to create a password when registering?

 

Setting up a password secured device allows you, whether you use it for private logging, or fleet management, to keep your personal information from being used in a harmful manner.

 

Having a device record every trip you make may be incredibly useful to you as an individual or business for a variety of reasons, but in the wrong hands could lead to an unwanted situation. Information on your whereabouts and every day routine should be kept private, and by securing your device with a password, you can ensure that only you can access your logged records.