Tax Break

When does section 23M of the Income Tax Act limit the interest a company can deduct on debt owed to a creditor in a controlling relationship, and why is it not just a cross-border rule? This episode of Tax Break highlights three pointers for identifying whether s 23M applies. Pieter starts with the origin of the provision in the 2013 Amendment Act alongside the OECD BEPS Action 4 work on interest...

Understatement penalties (USP) and bona fide inadvertent errors after the amendment to section 222 of the Tax Administration Act (TAA): if you correct an error on a return that has already been assessed, has the amendment created a new risk? The request for correction function on SARS eFiling, and the objection route where an assessment has already been audited or verified, have been the standard...

Reportable arrangements (RAs) under section 35 of the Tax Administration Act are often overlooked by advisors, and frequently only surface when an accountant reaches the "reportable arrangement" question on the tax return. This episode of Tax Break sets out what reportable arrangements are, where they are found in the legislation, and what to do when a transaction is reportable. Reportin...

Are self-insurance premiums deductible? In this episode of Tax Break, I discuss the deductibility aspect of the Western Cape High Court judgment in CSARS v Meiring Citrus (Pty) Ltd.  I cover: The two grounds that SARS abandoned The court’s conclusion as to whether the taxpayer actually incurred expenditure Why I disagree with the court's position on expenditure The court’s position on the capi...

When does prescription protect taxpayers from SARS issuing additional assessments? Section 99 of the Tax Administration Act generally bars SARS from issuing an additional assessment more than three years after the original assessment issued by SARS. Section 99(2) lifts that bar where the tax was not assessed due to fraud, misrepresentation or non-disclosure of material facts. In this episode of Ta...

The National Treasury published the 2026 draft Tax Administration Laws Amendment Bill (draft TALAB) for public comment on 30 July 2026. In this episode, I discuss three proposed amendments with clear practical impact for South African taxpayers and their advisors, two of which are favourable to taxpayers. The topics covered: ·       Employees' tax (PAYE): a proposal to narrow the withholding o...

South Africa’s National Treasury published the 2026 draft tax law amendments for public comment on 30 July 2026. Although proposals are technical, tax practitioners and CFOs need to assess whether their businesses or clients are affected. In this episode I analyse four key proposals: the interaction between the controlled foreign company (CFC) rules and the domestic treasury management company (DT...

Does the label on a contract determine its South African tax consequences? If you call an agreement a loan, are the payments deductible interest? If you call it a lease, are the outflows deductible rent? In CSARS v Meiring Citrus the Western Cape High Court considered whether premiums on a contract labelled an insurance policy were deductible. In this episode I examine the key aspects of the judgm...

Zero-ratings are complex and often underestimated by taxpayers and their advisors. The exposure may be significant if you get it wrong, especially on recurring transactions. Interpretation Note 31 is an essential part of applying a zero-rating. SARS issued a revised version of this interpretation note (Issue 5), nearly 10 years since the previous version. In this episode, I discuss zero-rating, th...

SARS issued a draft guide on the taxation of crypto assets. In this episode, I discuss a few aspects of this draft guide that I believe offer valuable insights into SARS’ position on these assets. You can contact me at  ⁠pieter@pvdz.co.za⁠  if you have any feedback on the episode or require tax advice. My website contains more resources and articles that may interest you  –  ⁠https://tax.pvdz.co.z...

Section 42 of the Income Tax Act provides relief for asset-for-share transactions. In this episode, I discuss some anti-avoidance rules to consider when dealing with asset-for-share transactions. You can contact me at  ⁠pieter@pvdz.co.za⁠  if you have any feedback on the episode or require tax advice. My website contains more resources and articles that may interest you  –  ⁠https://tax.pvdz.co.za...

Section 42 of the Income Tax Act provides relief for asset-for-share transactions. In this episode, I discuss how the provision works, some of its history and context as well as its purpose.  You can contact me at  ⁠pieter@pvdz.co.za⁠  if you have any feedback on the episode or require tax advice. My website contains more resources and articles that may interest you  –  ⁠https://tax.pvdz.co.za⁠ ....

When does the tax law require a person to charge interest? The answer is never. It only sets out what the tax implications are if parties do not charge interest. In this episode, I talk about tax implications that may affect the decision to charge interest or not. If you have an idea or suggestion for an episode or would like to see and vote for suggestions by other listeners, please visit the Tax...

Taxpayers often suggest that as long as SARS taxes an amount, or a deduction is only claimed once, then that should be acceptable. This is however not correct – the timing of the inclusion or deduction matters. In this episode, I speak about a recent tax court case that illustrates the importance of timing. If you have an idea or suggestion for an episode or would like to see and vote for suggesti...

SARS recently launched the IT3(BO) third party declaration process that relates to the income tax of partnerships. I take this opportunity to discuss some of the key principles of partnership taxation in this episode. If you have an idea or suggestion for an episode or would like to see and vote for suggestions by other listeners, please visit the Tax Break app at  https://tax.pvdz.co.za/app . You...

The Constitutional Court recently ruled on two legal questions relating to the GAAR raised in a review application by ABSA. In this episode, I discuss the case and share my thoughts on some aspects of the judgment.  If you have an idea or suggestion for an episode or would like to see and vote for suggestions by other listeners, please visit the Tax Break app at  https://tax.pvdz.co.za/app .  You...

SARS issued an updated version of Interpretation Note 64 in December 2025. This interpretation note deals with, amongst others, the taxation of home owners associations. In this episode, I discuss some of the changes from the previous version of the interpretation note to the current one – particularly those relating to home owners associations. If you have an idea or suggestion for an episode or...

The National Treasury announced changes to the VAT registration thresholds in the 2026 Budget Review. Some vendors may be considering deregistration as a result of these changes. In this episode, I discuss some practical considerations to keep in mind when deciding whether to deregister.  If you have an idea or suggestion for an episode or would like to see and vote for suggestions by other listen...

There has recently been an increase in the number of cases before the courts involving the general anti-avoidance rules (the GAAR). In this episode, I discuss the key elements of the GAAR.  If you have an idea or suggestion for an episode or would like to see and vote for suggestions by other listeners, please visit the Tax Break app at  https://tax.pvdz.co.za/app .  You can contact me at  ⁠pieter...

There is always a lot of excitement about budget and 2026 was no different. In this episode, I discuss some tax proposals in the budget that could be interesting for tax professionals and practitioners.   You can contact me at  ⁠pieter@pvdz.co.za⁠  if you have any feedback on the episode, would like to suggest a topic for a future episode or require tax advice. My website contains more resources a...

Section 7C has been a hot topic for tax practitioners since its introduction in the Income Tax Act as part of the 2016 amendments. It is one of the few sections that most people recognise by the section number! SARS issued a draft interpretation note for comment late in November 2025. Although this document is only a draft, one can glean some insight into SARS’ approach and interpretation of the p...

SARS recently issued an interesting ruling on a something that comes up very often in practice - interest deductibility. In short, the ruling deals with the deductibility of interest on a loan that will be used to redeem preference shares. In this episode, I discuss the ruling, recap on the requirements for interest to be deductible and consider why the taxpayer may have felt it needed to apply fo...

Consider the following scenario: you, or perhaps your client, owns a small business. The time has arrived, as with many small businesses, to sell - whether the business has reached a point where it requires a larger structure to grow, perhaps an opportunity to sell arose, or the owner and operator may just no longer be interested in conducting it - so CGT is on the cards. The CGT rules in the Eigh...

When thinking about VAT and grants, your first instinct is probably that there should not be VAT on a grant. In this episode, I look at a tax court case that illustrates the importance of being careful when dealing with VAT and grants, as this can be more complex than it seems at first. You can contact me at  ⁠pieter@pvdz.co.za⁠  if you have any feedback on the episode, would like to suggest a top...

Many companies, both large and small, use share incentives for key staff members to align their objectives with those of the company. The design may look different between - for example, listed or private companies. However, the tax considerations at the core of the schemes are actually very similar - so question is then, what are these key tax matters to consider? In this episode, I discuss some...