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What process must be followed when transferring a vehicle registered in a CC's name to a member?

Tuesday, 10 March 2015   (0 Comments)
Posted by: Author: SAIT Technical
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Author: SAIT Technical

Q: One of our clients is a member of a CC. He currently uses a vehicle registered in the name of the CC, but wants to transfer the ownership of the vehicle in his personal capacity. How do we go about doing this, without having any tax complications? We want to register the vehicle in the member's name, so that the CC can pay him a travel allowance, and do away with the fringe benefit. How do we go about  transferring a vehicle registered in a CC's name to a member's name?

A: We assume he is an employee or office holder of the CC. The disposal of an asset to an employee must be for a consideration equal to the market value of the vehicle otherwise a taxable benefit will apply in terms of para 2(a) read with para 5 of the Seventh Schedule of the Income Tax Act.

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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