Draft Taxation Laws Amendment Bill 2017 and Draft Tax Administration Laws Amendment Bill 2017 published
The amendments proposed by the Taxation Laws Amendment Bill (TLAB) 2017 and the Tax Administration Laws Amendment Bill (TALAB) 2017 were published on SARS’s and National Treasury’s websites for public comment.
These draft Bills give effect to the tax proposals announced on Budget Day, 22 February 2017.
The main tax proposals in the TLAB 2017 that can have an impact on employers and payroll are:
- Tax relief for bargaining councils regarding tax noncompliance.
- Changes to the anti-avoidance rules for certain share schemes, mainly trusts.
- A higher fringe benefit exemption for bursaries to learners with disabilities.
- Removing the foreign employment income tax exemption in respect of South African residents.
- Addressing the circumvention of anti-avoidance rules dealing with share buy backs, dividend stripping and contributed tax capital.
- Postponement of annuitization requirement for provident funds to 1 March 2019.
- Clarifying the rules relating to the taxation of employee-based share schemes.
- Clarifying the hours used for the ‘160-hour’ determination for section 4(1)(b)(ii) of the Employment Tax Incentive Act, are the hours defined as “ordinary hours” by the Basic Conditions of Employment Act.
The main tax proposals in the TALAB 2017 that can have an impact on employers and payroll are:
- To include only the portion of the travel reimbursement that is calculated at a rate per kilometer that exceeds the prescribed rate per kilometer in remuneration.
- To spread the R350 000 pa monetary cap that limits the deduction allowed in respect of contributions to retirement funds over 12 months.
A more detailed discussion of the proposed changes will be provided once the legislation has been formally introduced to the National Assembly.
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