SARS AND ITS NEW POWERS

With recent effect the Tax Administration Act (TAA), allows SARS to “search and seize” without first obtaining a court warrant. This enables the taxman to act immediately in order to stop tax evaders from hiding or destroys records or evidence during the period of delay that would normally precede the issue of a court warrant.

 

This is great news for SARS in its fight against tax evasion, but what about our constitutional rights to privacy and fair administrative action? Thus limitations do apply and a warrantless search is only permitted if -

 

1. The owner or person in control of the premises consents in writing to the search; or

 

2. If no consent is given, if a senior SARS official “on reasonable grounds” is satisfied that:

 

- There may be an imminent removal or destruction of relevant material likely to be found on the premises,

 

- SARS would have obtained a warrant had it applied for one, and

 

- The delay in obtaining a warrant would defeat the object of the search and seizure.

 

Even if you are totally innocent of any wrong-doing, to have a team of SARS officials arriving unannounced on your doorstep is always going to be stressful, apart from the fact that it results in disruption to your business activities. So what do you do if it happens?

1. First check the officials’ SARS I.D. cards. These I.D. cards are a requirement of the TAA. And if you have any doubt as to the genuineness of any card, phone 012-4227435 to check.

 

2. Then call in legal assistance immediately - you must of course co-operate with lawful requests made of you, but the TAA also gives you many rights and safeguards, and you are entitled to urgent access to the courts to enforce them if need be.

 

What Makes Little Logbook Unique?

Although many will agree that Little LogBook is an excellent product, a few have asked what makes it unique in a market where there are other alternatives.

 

Firstly, Little LogBook is a true pioneer in that although the concept may have existed overseas, Little LogBook was the first of its kind on South African soil. While everyone was still talking about keeping a logbook with paper and pen, Little LogBook was pioneering the concept of doing it the convenient and easy with GPS technology.

 

On top of being first, it is also a bone fide South African product that is 100% designed and supported right here in South Africa. No country is the same, so what this means for you is that Little LogBook was designed with YOU in mind – for South Africans by South Africans. And if you need help or support on your Little LogBook, you can speak directly to the people that made it - hassle free!

 

Although the product has been around for a few years now, Little LogBook has stayed abreast with the latest developments, from improvements in GPS technology from AGPS to SAGPS, and updates on Google and other mapping programs. We are always improving and adapting the hardware and software to meet our client’s needs.

 

Little LogBook is a beacon of South African ingenuity and innovation. It has truly transformed how we do business and taken away much of the stress and hassle related to filling in our log books for your tax returns.

 

 

Where are all my taxes going - a summary of the 2013 National Budget.

How PravinGordhan plans to allocate funds to the nation

 



Tax incentives for youth jobs

 

Tax incentives to employ young people and for people employed in the special economic zones (SEZs) are on the cards.

 



R7bn tax relief for individuals

 

Individuals will benefit from R7 billion in personal income tax relief, together with adjustments to the medical tax credit and other monetary thresholds amounting to about R350 million.

 



Individual tax payers will start paying tax at an annual income of R67 111 (R63 556 last year) for people below 65, R104 611 (R99 056) for persons 65 to 74 and R117 111 (R110 889) for persons over 75.

 



Individuals whose taxable income is only from a single employer and does not exceed R250 000 for the 2012/13 tax year are not required to submit tax returns.

 



Crime fighting - budget sends police back to basics

 

Gordhan announced that the bulk of the police department's budget (R67.9 billion in 2013/14, rising to R75.8 billion by 2015/16 ) will go towards visible policing at police stations, in an effort to drive down crime rates.

 



Sin taxes, fuel levies up

 

Beer drinkers will pay 7 cents more for a 340ml can. A bottle of wine will cost 15 cents more, while the price of ciders and alcoholic fruit beverages is set to rise seven cents a litre.A 750ml bottle of spirits will cost R3.60 more from April 1.

 



Health gets R133bn budget

 

Of this, R48.8 billion is for district, R26.4 billion for provincial, and R18.9 billion for central health services.

 



Over 400,000 houses to be delivered

 

Transfers of funds would be made to provinces and municipalities through grants to accelerate the delivery of such housing and basic services to households.

 



New tax proposals on retirement funds

 

Individuals would be allowed to deduct up to 27.5 percent of the higher of taxable income or employment income, for contributions to pension, provident and retirement annuity funds.

 



Education gets R200bn

 

A total of R232.5 billion has been set aside for the departments of basic education, higher education and training, and arts and culture.

 



The breakdown in spending for the 2013/14 financial year will be:

 



-- R164bn for basic education;

 

-- R28.7bn for tertiary education;

 

-- R20.1bn for vocational and continuing education;

 

-- R10.6bn for education administration; and

 

-- R9.1bn for recreation and culture.

 



Over 600k households to be electrified

 

R5.7 billion over the next three years will be used on infrastructure to ensure 645,000 households are connected to the electricity grid over this period.

 



Agriculture - focus on smallholder farmers

 

It would spend in excess of R6 billion over the medium term on conditional grants to provinces, to support 435,000 subsistence farmers and 54,500 smallholder producers.

 



Labour unrest leads to weak output growth

 

The total value of losses in mining production due to the crippling 2012 strikes has exceeded the R15 billion mark, the National Treasury estimates.

According to the 2013/14 budget review document, copper production fell by 21.8 percent, gold by 14.5 percent, and platinum by 12 percent.

 



Gordhan gives Sanral, Prasa more money

 

The Passenger Rail Agency of South Africa will get roughly R5 billion over the next three years to fund plans to renew its fleet.

 



SAA, SABC could see restructuring

 

State-owned enterprises (SOEs) that are bleeding money could see some restructuring



Programme aims to create 3.7m jobs

 

"The department (of public works) has re-prioritised R248 million over the MTEF (medium-term expenditure framework) period from transfers to provinces and municipalities to... the non-state sector as follows: R80.2 million in 2013/14, R87.7 million in 2014/15, and R79.7 million in 2015/16."

 



Gordhan mum on mining taxes

 

Finance Minister PravinGordhan stressed that mining was a cornerstone of the South African economy, and refused to comment on the rumoured increase in mining taxes.

 



Decrease in US Aids funding

 

R100m had been allocated in 2014/15 and R384 million in 2015/2016 to partly offset the decreases of the contribution that came from the US President's Emergency Plan for Aids Relief programme

 



No NHI tax expected in medium term

 

It is unlikely that tax will be increased in the medium term to fund the National Health Insurance (NHI) scheme

 



Business confidence growing. Plans for construction and refurbishment

 

Plans by business included construction and refurbishment by a company in the hospitality sector of R2.5 billion in the next 18 months, and expansion of R3 billion in the pipeline.

 



There were two telecommunications investments amounting to R14 billion this year, and capital spending of R3.4 billion over the next three years by a rail and logistics operator.

 



Also, a R2.5 billion expansion and longer-term plans of R15 billion in mining projects, and investment of R1.4 billion this year by a leading retailer, and plans to open 100 new stores by another.

 



KZN gets bigger budget transfer

 

The province would receive R88 billion for 2013/14, followed by Gauteng with R76.9bn and the Eastern Cape with R59.6bn.

 



Limpopo receives R48.5bn, the Western Cape R41.7bn, Mpumalanga R33bn and the North-West R27.7bn.

 



R6.5billion extra for water affairs

 

An additional R6.5 billion is set to flow into water affairs' coffers over the next three years

 



Gordhan warns against tax avoidance

 

We owe it to our taxpayers to ensure they are not carrying the burden of those who benefit from our country's infrastructure and resources without paying their fair share of the costs

 

What can I claim for on my Tax return?

Tax return season is never the most exciting time. Not only do we have to sort through endless amounts of paperwork (because chances are, some of us forget that deadlines are coming up), but we have to actually do tax returns. However, many people often forget that there are a number of expenses that are incurred throughout the tax year that make you eligible to claim money back from SARS.

 



While these claims don’t necessarily always add up to a significant amount, they can easily help in terms of keeping expenses as low as possible. Some of these refundable expenses are contingent on aspects such as employment, medical aid participation or working hours.

 



For example, you are eligible for a refund on taxes paid on items such as medication and medical supplies purchased through registered pharmacy outlets, taxes paid on medical aid payments (either through your employer or privately), travelling allowances (depending on your agreement with your employer and the stipulations set forth in the tax code) and various other contributions made by you through tax.

 



Casual workers who earn less than a certain amount per year (R57 000) can claim back the amount contributed on their behalf, as any earnings under a certain threshold are non-deductible.

 

Are All Young Drivers Really Bad Motorists?

During the last festive season, as is the case every year around the same time, both provincial and national government begin working toward clamping down on reckless, negligent and drunken driving. A recent interview with an Arrive Alive spokesperson conducted by the New Age newspaper stated that young drivers seem to be at the forefront of the reckless behavior that is exhibited, not only during these times, but year-round.

 

Spokesperson, Tshepo Machaea, cited statistics in an interview with the newspaper, and claimed that   whenever roadblocks are conducted, the majority of offenders would tend to be young drivers either driving under the influence or without a legal drivers’ license. The figures given are, of course troubling, if we factor in the number of annual deaths caused by negligent and reckless driving. The idea of these deaths being caused by inexperienced and reckless youngsters with little to no experience on the road, or even without the right to actually be operating the vehicle should be addressed as quickly as possible.

 

While it is not necessarily a guaranteed fail safe, one way that such negligence could be curbed is by installing some kind of drivers’ education system into the high school phase of education, the time when children are most likely to be preparing to obtain their licenses. This will give schools and governments the ability to monitor driving ability more closely, while educating possible future drivers in safety and responsibility.

 

On the other hand, it does seem a little bit unfair to state outright that by being a young, inexperienced driver that one will be more likely to cause an accident, or to drive under the influence of alcohol or narcotics. While it may seem like the evidence points to this conclusion, the question of whether or not these practices are carried over into later life should be asked. It seems to not be a case of the younger generation being less responsible than the previous, but simply a case of younger drivers being more prominently assumed to be risks in the eyes of authorities.

 

Clamping down on negligent and reckless driving across the board, regardless of the perpetrator’s age and driving experience should provide at least one step closer to the goal of reducing death and accidents on the roads.

Types of Tax in South Africa

 

 

The South African tax system 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

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.