The National Treasury and South African Revenue Service (SARS) today published the
revised 2016 Draft Rates and Monetary Amounts and Amendment of Revenue Laws
Amendment Bill and 2016 Draft Rates and Monetary Amounts and Amendment of
Revenue Laws (Administration) Bill.
The revised draft bills contain a revised Special Voluntary Disclosure Programme
(SVDP) to give an opportunity to non-compliant taxpayers to voluntarily disclose offshore
assets and income before the new global standard for automatic exchange of
information between tax authorities commences in 2017.
The initial draft bills were published for public comment on 24 February 2016 and 12
April 2016. Following public comments received and a consultation meeting in respect of
the SVDP held with taxpayers and tax advisors on 10 June 2016, the following changes
have been made in the revised draft bills in order to simplify the SVPD:
– Instead of calculating two different amounts (i.e. seed capital and investment
returns) to be included in the taxpayer’s taxable income, the calculation now
consists of one amount. This amount equals 50 per cent of the highest value of
the aggregate of all assets situated outside South Africa between 1 March 2010
and 28 February 2015 that were derived from undeclared income, which will be
included in taxable income and subject to tax in South Africa.
– The value referred to above is the market value determined in the relevant
foreign currency translated to South African Rand at the spot rate at the end of
the tax period in which the highest value fell.
– The undeclared income that originally gave rise to the assets mentioned above
will be exempt from income tax, donations tax and estate duty liabilities arising in
the past. However, future income will be fully taxed and assets declared will
remain liable for donations tax and estate duty in the future, should the applicant
donate these assets or pass away while holding them.
– Taxpayers who disposed of any foreign held assets prior to 1 March 2010 may
also apply for relief under the SVDP. Special deeming provisions will apply in
this regard.
– Any non-compliance with respect to Value Added Tax, employees’ tax (PAYE),
unemployment insurance fund (UIF) contributions and skills development levies
(SDL) will not qualify for the SVDP. However, relief for penalties associated with
non-compliance of these taxes will continue under the existing voluntary
disclosure programme in terms of the Tax Administration Act, 2011.
The Standing Committee of Finance will convene public hearings on the revised draft
bills before their formal introduction in Parliament. Given the truncated parliamentary
programme due to the local government elections, the first parliamentary hearings on the
draft bills are only expected to be convened in the second half of August 2016.
The revised draft bills and draft explanatory memorandum containing a comprehensive
description of the draft amendments can be found on the National Treasury
(www.treasury.gov.za) and SARS (www.sars.gov.za) websites.
Due date for comments
The National Treasury and SARS have already asked and received comments on two
previous versions of these Bills. Any additional comments on the revisions included in
the latest drafts of the Bills should please be forwarded in writing to Mmule Majola at:
[email protected] and Adele Collins at: [email protected] by close of
business on 8 August 2016.
