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STC & DWT
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2013/02/08 at 12:23:22 PM GMT
Posts: 2
STC & DWT

Information:

The taxpayer had a shareholders loan owing to him in the amount of R10million and there was a debit loan to a company that he was share holder in of R1million. (as a result a net credit loan of R9million).SARS deemed the debit loan as a deemed dividend and taxed the tax payer accordingly.

Three questions:

Strict application of Section 64C(2)g, is that if there is a debit loan it deemed to be a dividend.

Can SARS apply there mind and take into consideration the fact that the company owes him R10million and that the net effect is that the company owes him and that he has put money into the business and not taken any out, that could be seen to be "dividend" Any way that I can get around this?

Can a company be taxed twice? Once under the STC rules and once under DWT?Can the taxpayer deduct from the future dividend, the amount that was deemed to be a dividend by SARS, in order for the taxpayer not to pay the tax twice?

Figures:

Currently

Deemed dividend – R1,000,000

Future

Actual Dividend –                                           R6,000,000

Less Deemed Dividend –                   R1,000,000

Taxable Dividend                                            R5,000,000 

 



2013/03/26 at 07:38:58 AM GMT
Posts: 2

Has anyone got any answers for me?

So the taxpayer is going to pay tax twice, in accordance with the current legislation.

Can't only be our client with the issue.

 

 



2013/03/26 at 06:53:34 PM GMT
Posts: 52
STC &DWT

Hi Mark

Question

Are you saying that the taxpayer A lent Company B, R10million rand and that Company B in turn lent taxpayer A R1million rand? If so is the R1million "loan” by company B not  part repayment of taxpayer A’s loan account?

Thanks



2013/05/21 at 11:19:16 PM GMT
Posts: 5
STC & DWT

Indien 'n lid van 'n BK 'n debietlening het van R1000 000.00 sal daar geagte dividendbelastingbetrokke wees of byvoordeelbelasting of beide?

 

Dankie



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