Behind SA’s Withholding Taxes
08 October 2013
Posted by: Author: Ingé Lamprecht
Author: Ingé Lamprecht (Moneywebtax)
Why Sars is likely to introduce anti-avoidance measures.
As South Africa expands the number of withholding taxes it imposes, anti-abuse measures is likely to get more attention in domestic taw laws.
While the withholding tax on royalties (12%) has been levied for a couple of decades already, the South African Revenue Service (Sars) has only fairly recently introduced a withholding tax on non-resident sports persons and entertainers (15%), a 15% withholding tax on dividends and a withholding tax on immovable property (5% to 10%). A proposed 15% withholding tax on interest from 2015 is also in the pipeline.
Internationally, tax authorities use withholdings tax as a mechanism to collect taxes from non-residents who may not be easily accessible. Tax authorities also favour the tax due to the relative ease of administration thereof.
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This article was first published on moneywebtax.co.za