Author: admin_kmos

Subsections 2, 3, 4, 5, 6, 7, 8, 9 and 10 of section 30B of ITA

Posted on by admin_kmos

(2)     Subject to subsections (3) and (4), the Commissioner must approve an entity for the purposes of section 10(1)(d)(iii) or (iv) if-

(a)     that entity has submitted to the Commissioner a copy of the constitution or written instrument under which it has been established;

(b)     the constitution or written instrument contemplated in paragraph (a) provides that-

(i)      the entity must have a committee, board of management or similar governing body consisting of at least three natural persons, who are not connected persons in relation to each other, to accept the fiduciary responsibility of that entity;

[Subparagraph (i) substituted by section 8(a) of Act 18 of 2023]

(ii)     no single person may directly or indirectly control the decision-making powers relating to that entity;

(iii)    the entity may not directly or indirectly distribute any of its funds or assets to any person other than in the course of furthering its objectives;

(iv)    the entity is required to utilise substantially the whole of its funds for the sole or principal object for which it has been established;

(v)     no member may directly or indirectly have any personal or private interest in that entity;

(vi)    substantially the whole of the activities of the entity must be directed to the furtherance of its sole or principal object and not for the specific benefit of an individual member or minority group;

(vii)   the entity may not have a share or other interest in any business, profession or occupation which is carried on by its members;

(viii)  the entity must not pay to any employee, office bearer, member or other person any remuneration, as defined in the Fourth Schedule, which is excessive, having regard to what is generally considered reasonable in the sector and in relation to the service rendered;

(ix)    substantially the whole of the entity’s funding must be derived from its annual or other long-term members or from an appropriation by the government of the Republic in the national, provincial or local sphere;

(x)     the entity must as part of its dissolution transfer its assets to-

(aa)   another entity approved by the Commissioner in terms of this section;

(bb)   a public benefit organisation approved in terms of section 30;

(cc)   an institution, board or body which is exempt from tax under section 10(1)(cA)(i); or

(dd)   the government of the Republic in the national, provincial or local sphere;

(xi)    the persons contemplated in paragraph (b)(i) will submit any amendment of the constitution or written instrument of the entity to the Commissioner within 30 days of its amendment;

(xii)   the entity will comply with such reporting requirements as may be determined by the Commissioner from time to time; and

(xiii)   the entity is not knowingly and will not knowingly become a party to, and does not knowingly and will not knowingly permit itself to be used as part of, an impermissible avoidance arrangement contemplated in Part IIA of Chapter III, or a transaction, operation or scheme contemplated in section 103(5); and

[Subparagraph (xiii) amended by section 8(b) of Act 18 of 2023]

(c)     the Commissioner is satisfied that the association does not have a person acting in a fiduciary capacity, who is disqualified in terms of section 6 of the Trust Property Control Act, 1988 (Act 57 of 1988), section 25A of the Nonprofit Organisations Act, 1997 (Act 71 of 1997), or section 69 of the Companies Act.

[Paragraph (c) added by section 8(c) of Act 18 of 2023]

(3)     The requirements contained in subsection (2)(b)(iii) and (v) do not apply in respect of a mutual loan association.

(4)     Where the constitution or written instrument of an entity does not comply with subsection (2)(b), the Commissioner may deem it to so comply if the person who has accepted fiduciary responsibility for the funds and assets of that entity furnishes the Commissioner with a written undertaking that the entity will be administered in compliance with that subsection.

(5)     Where the Commissioner is-

(a)     satisfied that any entity approved in terms of subsection (2) has during any year of assessment in any material respect; or

(b)     during any year of assessment satisfied that any such entity has on a continuous or repetitive basis,

failed to comply with this section, or the constitution or written instrument under which it was established to the extent that it relates to this section, the Commissioner must notify the entity that he or she intends to withdraw approval of the entity if corrective steps are not taken by the entity within the period stated in the notice.

(6)     If no corrective steps are taken by the entity contemplated in subsection (5), the Commissioner must withdraw approval of that entity with effect from the commencement of the year of assessment contemplated in subsection (5).

(7)     If the Commissioner has withdrawn the approval of an entity as contemplated in subsection (6) the entity must within six months after the date of the withdrawal of approval (or such longer period as the Commissioner may allow) transfer, or take reasonable steps to transfer, its remaining assets to any entity, public benefit organisation, institution, board or body or the government of the Republic, contemplated in subsection (2)(b)(x).

(8)     If an entity is wound up or liquidated, the entity must, as part of the winding-up or liquidation, transfer its assets remaining after the satisfaction of its liabilities to any entity, public benefit organisation, institution, board or body or the government of the Republic, contemplated in subsection (2)(b)(x).

(9)     If an entity fails to transfer, or to take reasonable steps to transfer, its assets as contemplated in subsection (7) or (8), an amount equal to the market value of those assets which have not been transferred less an amount equal to the bona fide liabilities of that entity must for the purposes of this Act be deemed to be an amount of taxable income which accrued to that entity during the year of assessment in which the withdrawal of approval in terms of subsection (6) or the winding-up or liquidation contemplated in subsection (8) took place.

(10)   Any person who is in a fiduciary capacity responsible for the management or control of the income and assets of any approved association and who intentionally fails to comply with any provision of this section or of the constitution, or other written instrument under which such association is established to the extent that it relates to the provisions of this section, shall be guilty of an offence and liable on conviction to a fine or to imprisonment for a period not exceeding 24 months.

(11)   A person may not act in a fiduciary capacity if that person is disqualified in terms of section 6 of the Trust Property Control Act, 1988 (Act 57 of 1988), section 25A of the Nonprofit Organisations Act, 1997 (Act 71 of 1997), or section 69 of the Companies Act.

[Subsection (11) inserted by section 8(d) of Act 18 of 2023]

(12)   A person who fails to comply with the provisions of subsection (11) shall be guilty of an offence and liable, on conviction, to a fine or to imprisonment for a period not exceeding 24 months.

. [Subsection (12) inserted by section 8(d) of Act 18 of 2023]

Section 47K (ITA) – Notifications of specified activity

Posted on by admin_kmos

47K.    Notification of specified activity

 

Any resident who is primarily responsible for founding, organising, or facilitating a specified activity in the Republic and who will be rewarded directly or indirectly for that function of founding, organising or facilitating must, in the manner and form prescribed by the Commissioner –

 

(a)     notify the Commissioner of that specified activity within 14 days after the agreement relating to that founding, organising or facilitating of that specified activity has been concluded; and

 

(b)     provide to the Commissioner such other details relating thereto as may be required by the Commissioner.

Section 47J – Currency of payments made to Commissioner

Posted on by admin_kmos

47J.     Currency of payments made to Commissioner

If an amount deducted or withheld by a resident in terms of section 47D is denominated in any currency other than the currency of the Republic, the amount so deducted or withheld and paid to the Commissioner must be translated to the currency of the Republic at the spot rate on the date on which that amount was so deducted or withheld.

Section 47G (ITA) – Personal liability of resident

Posted on by admin_kmos

47G.    Personal liability of resident

(1)     A resident who –

(a)     fails to deduct or withhold an amount of tax in terms of section 47D from any payment made to a taxpayer: or

(b)     deducts or withholds an amount of tax but fails to pay that amount over in terms of section 47E,

is personally liable for payment of that amount of tax in accordance with Part A of Chapter 10 of the Tax Administration Act.

(2)     ……….

(3)     Subsection (1)(a) does not apply where the taxpayer has in terms of section 47C(1) paid to the Commissioner the amount of tax payable under this Part in respect of the payment from which the resident has so failed to deduct or withhold the tax.


47H.  . . . . . .



47I.   . . . . . .

[Wording of section 47I prior to amendment by Act 28 of 2011 applicable to the extent it relates to interest]

Section 47E – Payment of amounts of tax deducted or withheld

Posted on by admin_kmos

47E.     Payment of amounts of tax deducted or withheld

 

(1)     A resident must pay any amount deducted or withheld in terms of section 47D to the Commissioner before the end of the month following the month during which that amount was so deducted or withheld.

 

(2)     The payment contemplated in subsection (1) is a payment made on behalf of the taxpayer in respect of his or her liability under section 47B.