have been anticipating the introduction of a withholding tax on interest paid
to non-residents for a number of years now. The effective date for the
commencement of the withholding tax on interest will be further delayed from 1
July 2013 to 1 March 2014.
royalty withholding tax to be imposed at a rate of 15% (which is currently
imposed at a rate of 12%) will also be delayed until 1 March 2014.
significantly, it is proposed that a withholding tax, presumably at a rate of
15%, will be imposed on service fees paid to a non-resident (subject to the
applicable treaty relief). The withholding tax on service fees will also be
effective from 1 March 2014. It will be interesting to see how the legislature
defines "service fees"or "services"
to determine how far-reaching this amendment will be.
Lewis, senior associate, tax, Cliffe Dekker Hofmeyr
Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.