By the Tax Season deadline on Friday 20 November 2009, the South African Revenue Service had received a remarkable new record number of 4.06 million returns for individuals and trusts - exceeding the 2008 return submission by approximately 800 000. This is a significant achievement, especially at a time when the South African economy contracted into recession.

This breakthrough is indicative of the improved tax compliance culture of South Africans to make our country a better place for all. However, the real challenge now is for government to improve the service delivery to build on this.

Yours truly,
Stiaan Klue
Chief Executive

Among the lesser known deductions allowed in the determination of the net value of an estate for estate duty purposes are those found in s 4(i) and (j) of the Estate Duty Act.

According to a leading global audit firm, businesses only realise the importance of effectively managing their zero-rated supplies once challenged by revenue authorities, or when penalties imposed erode hard-earned profits.

By the Tax Season deadline on Friday 20 November 2009, the South African Revenue Service (SARS) had received a remarkable, new record number of over 4 million returns for individuals and trusts that were submitted, exceeding the 2008 filing experience by a some 800 000 or 26%!

This ruling deals with the deductibility of interest payable on a loan to be obtained by a company in order to acquire the entire issued share capital of another company, where such share capital is to be acquired with the intention of acquiring the business of that other company.

This ruling deals with whether a company registered as a long-term insurer, which will make annuity payments to another company registered as a longterm insurer in terms of an annuity contract, will be obliged to deduct employees’ tax from such annuity payments in accordance with the provisions of the Fourth Schedule to the Act.

The recession is taking its toll on tax receipts across the OECD. Aggregate tax burdens in OECD economies, calculated as the ratio of tax revenues to gross domestic product, or GDP, were unchanged between 2006 and 2007, and then fell in 2008. The reduction in the tax burden in 2008 is estimated to have been some ½ percent of GDP, from 35.8% to an estimated 35.2%.

The OECD Committee on Fiscal Affairs invites public comments on draft changes to the Commentary on the OECD Model Tax Convention dealing with the application of tax treaties to state-owned entities, including Sovereign Wealth Funds.

The OECD Committee on Fiscal Affairs invites public comments on draft changes to the Commentary on the OECD Model Tax Convention dealing with tax treaty issues related to common telecommunication transactions.

Costa Rica announced that it has signed a tax information exchange agreement with Argentina. The agreement, which meets the internationally agreed standard for exchange of information for tax purposes, is the first such agreement signed by Costa Rica. It provides for various forms of exchange of information, including exchange of information on request, simultaneous and industry-wide examinations, and tax examinations abroad.

On 24 November 2009, the OECD Committee on Fiscal Affairs approved the release, for public comment, of a revised draft of a new Article 7 (Business Profits) of the OECD Model Tax Convention and of related Commentary changes.