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News & Press: SARS operational & eFiling questions

Supporting documents for corporate rule transactions and the dividend tax exemption

09 December 2014   (0 Comments)
Posted by: Author: SAIT Technical
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Author: SAIT Technical

Q: We please require some guidance on the following, if you can please assist.

1.       Corporate transactions S42-S47

  • Should any documentation be submitted to SARS describing the transactions?
  • If yes, are there prescribed documents and to whom should it be sent?

2.       Dividend exemption declaration s64G(3)

"Submit declaration as prescribed by the commissioner that the dividend is exempt from tax s64G(3)”

  • Where can we find the prescribed declaration?
  • To whom must this declaration be given, is it only to the company declaring the dividend or to SARS as well?
  • If no prescribed form, are there guidelines on how the declaration should look?
  • Do you do the declaration only once per investment or annually?

A: Corporate transactions S42-S47

The transactions listed in section 42 – 47 of the Income Tax Act apply automatically unless the parties elect out.  An election out would therefore require some documentation.  The Act doesn’t require this to be submitted to SARS and the only detail then required is the answer to the questions in the IT14, of course, when SARS requires detail from the taxpayer.  

Dividend exemption declaration s64G(3)

You can find a copy of the declaration (and other guidelines) can be found in the guide at the following link: http://www.sars.gov.za/pages/Results.aspx?k=DTD(EX)  

This declaration must be given to and be retained by the company declaring the dividend. It will only be given to SARS if they request it from the company.  

Disclaimer: Nothing in this query and answer should be construed as constituting tax advice or a tax opinion. An expert should be consulted for advice based on the facts and circumstances of each transaction/case. Even though great care has been taken to ensure the accuracy of the answer, SAIT do not accept any responsibility for consequences of decisions taken based on this query and answer. It remains your own responsibility to consult the relevant primary resources when taking a decision.


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