(July 22, 2015)

On July 22, 2015 the National Treasury of the Republic of South Africa opened a public consultation on the Draft Taxation Laws Amendment Bill (TLAB) and the 2015 Draft Tax Administration Laws Amendment Bill (TALAB). Comments should be sent to Nomalizo Bulisile at: This email address is being protected from spambots. You need JavaScript enabled to view it. and Adele Collins at This email address is being protected from spambots. You need JavaScript enabled to view it. by close of business on August 24, 2015.

The following documents were published, for public comment:

·        DRAFT TAXATION LAWS - AMENDMENT BILL, 2015;

·        EXPLANATORY MEMORANDUM ON THE TAXATION LAWS AMENDMENT BILL, 2015 (DRAFT)

·        DRAFT Tax Administration Laws Amendment Bill, 2015

·        DRAFT MEMORANDUM ON THE OBJECTS OF THE TAX ADMINISTRATION LAWS AMENDMENT BILL, 2015

A first batch of the 2015 TLAB was published on June 5, 2015 containing tax proposals that required an additional round of comments (for further information see our article from June 6, 2015). These proposals included measures to counter tax-free corporate migrations, transitional tax issues resulting from the regulation of hedge funds and the tax implications of the outright transfer of collateral. The current draft TLAB includes these proposals with the amendments that have arisen from comments received on the first batch.

The 2015 draft TLAB gives effect to the following key proposals announced in the 2015 Budget Review:

·        Closing a loophole to ensure consistent tax treatment on all retirement funds

·        Closing a loophole to avoid estate duty through excessive contributions to retirement funds

·        The tax implications of the outright transfer of collateral

·        Transitional tax issues resulting from the regulation of hedge funds

·        Measures to counter tax free corporate-migrations

·        Withdrawal of special foreign tax credits for service fees sourced in South Africa

·        Reinstatement of the controlled foreign company diversionary income rules

·        Allowing municipalities to demarcate more areas as Urban Development Zones

·        Monetary threshold adjustments for enterprise supplying commercial accommodation

The 2015 draft TALAB gives effect to the following key proposals:

·        Medical scheme tax credits to be taken into account for PAYE

·        Collection of information by South African financial institutions and an associated obligation on the financial institutions to register with SARS

·        Extension of period of limitations for issuance of assessments under narrow circumstances

·        Clarifying qualifying persons for voluntary disclosure, relaxing the requirements for voluntary disclosure and broadening the ambit of voluntary disclosure relief

For further information click here to be forwarded to a press release issued by the National Treasury of the Republic of South Africa on the opening of the public consultation.

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