A taxpayer can apply to the South African Revenue Service (SARS) for a binding ruling if the application of legislation is uncertain. The taxation of share incentive scheme benefits has been the subject of a whopping eighteen binding rulings published on the SARS website. This bears testimony to the complexity of the legislation, despite SARS' efforts to clarify legislative interpretation through the publication of two interpretation notes.
Not only is the tax treatment of benefits in the hands of employees complicated, but the taxation is not aligned with the income tax deduction of the employer share scheme costs.
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.