Category: CHAPTER II – The Taxes (ITA)

Section 64K (ITA) – Payment and recovery of tax

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64K.    Payment and recovery of tax

(1)

(a)     If, in terms of section 64EA(a), a beneficial owner is liable for any amount of dividends tax in respect of a dividend, that beneficial owner must pay that amount to the Commissioner by the last day of the month following the month during which that dividend is paid by the company that declared the dividend, unless the tax has been paid by any other person.

(b)     If, in terms of section 64EA(b), a company is liable for any amount of dividends tax in respect of a dividend, that company must pay that amount to the Commissioner by the last day of the month following the month during which that dividend is paid by the company.

(c)     If, in terms of this Part, a person is required to withhold any amount of dividends tax in respect of a dividend, that person must pay that amount, less any amount refundable in terms of section 64L or 64M, to the Commissioner by the last day of the month following the month during which that dividend is paid by that person as contemplated in section 64G or 64H.

(d)     ……….

[Paragraph (d) deleted by section 5 of Act 44 of 2014 effective on 20 January 2015]

(1A)   If, in terms of this Part a person has paid a dividend, that person must submit a return in respect of that dividend to the Commissioner by the last day of the month following the month during which the dividend is paid.

[Subsection (1A) inserted by section 5 of Act 44 of 2014, amended by section 4 of Act 23 of 2015 and section 3 of Act 16 of 2016 and substituted by section 4 of Act 13 of 2017 and section 1 of Act 22 of 2018 effective on 17 January 2019]

(2)     ………..

(3)     ……….

(4)     Where a person-

(a)     has, in terms of section 64G(2)(a) or 64H(2)(a), withheld no dividends tax in respect of the payment of any dividend, or in terms of section 64G(3) or 64H(3), withheld dividends tax in accordance with a reduced rate in respect of the payment of any dividend; or

[Paragraph (a) substituted by section 18(a) of Act 20 of 2022]

(b)     that is a company which was, in terms of section 64FA(1)(a), not liable for dividends tax, or in terms of section 64FA(2), liable for dividends tax at a reduced rate in respect of the declaration and payment of any dividend,

[Paragraph (b) substituted by section 18(b) of Act 20 of 2022]

that person must submit to the Commissioner any declaration-

(i)      submitted to the person by or on behalf of a beneficial owner; and

(ii)     relied upon by the person in determining the amount of dividends tax so withheld,

at the time and in the manner prescribed by the Commissioner.

(5)     ……….

(6)     If a person fails to pay any dividends tax within the required period, interest must be paid by that person on the balance of the tax outstanding at the prescribed rate reckoned from the end of that period.

Section 64L (ITA) – Refund of tax in respect of dividends declared and paid by companies

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64L.     Refund of tax in respect of dividends declared and paid by companies

 

(1)     Notwithstanding the provisions of Chapter 13 of the Tax Administration Act, if-

 

(a)     an amount is withheld by a company from the payment of a dividend in terms of section 64G(1);

 

(b)     a declaration contemplated in subsection (2)(a) or (3) of that section in respect of that dividend is not submitted to the company by the date contemplated in the relevant subsection; and

 

(c)     both the declaration and the written undertaking contemplated in section 64G(2)(a) or (3) are submitted to the company within three years after the date of payment of the dividend in respect of which they are made,

[Paragraph (c) substituted by section 15 of Act 21 of 2012 and section 5 of Act 13 of 2017 effective on 18 December 2017]

so much of that amount as would not have been withheld had that declaration been submitted by the date contemplated in the relevant subsection is refundable to the person to whom the dividend was paid.

 

(1A)    If-

 

(a)     an amount is withheld by a company from the payment of a dividend in terms of section 64G(1); and

 

(b)     a rebate in respect of foreign taxes paid on that dividend should have been deducted from that amount in terms of section 64N,

 

so much of that amount as would not have been withheld had that rebate been deducted from the amount, is refundable to the person to whom the dividend was paid: Provided such rebate is claimed within three years after the date of payment of the relevant dividend.

[Words following paragraph (b) substituted by section 5 of Act 13 of 2017 effective on 18 December 2017]

 

(2)     Any amount that is refundable in terms of subsection (1) or (1A) must be refunded by the company that withheld that amount to the person to whom the dividend was paid-

 

(a)     from any amount of dividends tax withheld by that company within a period of one year after the submission of the declaration contemplated in subsection (1)(c) or the claim of a rebate contemplated in subsection (1A); or

 

(b)     to the extent that the amount that is refundable exceeds the amount of dividends tax withheld as contemplated in paragraph (a), from an amount recovered by the company from the Commissioner in terms of subsection (3).

 

(3)     Subject to subsection (4), if any amount is refundable to any person by a company in terms of subsection (1) or (1A) and that amount exceeds the amount of dividends tax withheld as contemplated in subsection (2)(a), the company contemplated in subsection (2) may recover the excess from the Commissioner.

 

(4)     No amount may be recovered in terms of subsection (3) if the company submits the claim for recovery to the Commissioner after the expiry of a period of four years reckoned from the date of the payment contemplated in subsection (1)(a) or (1A)(a).

Section 64M (ITA) – Refund of tax in respect of dividends paid by regulated intermediaries

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64M.    Refund of tax in respect of dividends paid by regulated intermediaries

(1)     Notwithstanding the provisions of Chapter 13 of the Tax Administration Act, if-

(a)     an amount is withheld by a regulated intermediary from the payment of a dividend in terms of section 64H(1);

(b)     a declaration contemplated in subsection (2)(a) or (3) of that section in respect of that dividend is not submitted to the regulated intermediary by the date contemplated in the relevant subsection; and

(c)     both the declaration and the written undertaking contemplated in section 64H (2)(a) or (3) are submitted to the regulated intermediary within three years after the date of payment of the dividend in respect of which they are made,

[Paragraph (c) substituted by section 16 of Act 21 of 2012 and section 7 of Act 13 of 2017 effective on 18 December 2017]

so much of that amount as would not have been withheld had that declaration been submitted by the date contemplated in the relevant subsection is refundable to the person to whom the dividend was paid.

(1A)  If-

(a)     an amount is withheld by a regulated intermediary from the payment of a dividend in terms of section 64H(1); and

(b)     a rebate in respect of foreign taxes paid on that dividend should have been deducted from that amount in terms of section 64N,

so much of that amount as would not have been withheld had that rebate been deducted from the amount, is refundable to the person to whom the dividend was paid: Provided such rebate is claimed within three years after the date of payment of the relevant dividend.

[Words following paragraph (b) substituted by section 7 of Act 13 of 2017 effective on 18 December 2017]

(2)     Any amount that is refundable in terms of subsection (1) or (1A) to the person to whom the dividend was paid must be refunded by the regulated intermediary that withheld the amount contemplated in subsection (1)(a) or (1A)(a)-

(a)     from any amount of dividends tax withheld by the regulated intermediary within a period of one year after the submission of the declaration as contemplated in subsection (1)(c) or the claim of a rebate contemplated in subsection (1A) or

(b)     to the extent that the amount that is refundable exceeds the amount of dividends tax withheld as contemplated in paragraph (a), from an amount recovered by the regulated intermediary from the Commissioner in terms of subsection (3).

[Subsection (2) substituted by section 16(1)(c) of Act 21 of 2012 and by section 4(a) of Act 16 of 2022]

(3)     Subject to subsection (4), if any amount is refundable to any person by a regulated intermediary in terms of subsection (1) or (1A) and that amount exceeds the amount of dividends tax withheld as contemplated in subsection (2)(a), the regulated intermediary contemplated in subsection (2) may recover the excess from the Commissioner.

[Subsection (3) added by section 4(b) of Act 16 of 2022]

(4)     No amount may be recovered in terms of subsection (3) if the regulated intermediary submits the claim for recovery to the Commissioner after the expiry of a period of four years reckoned from the date of the payment contemplated in subsection (1)(a) or (1A)(a).

[Subsection (4) added by section 4(b) of Act 16 of 2022]

[Section 64M inserted by section 53(1) of Act 17 of 2009 effective on 1 April, 2012: Government Notice No. 1073 in Government Gazette 34873 of 20 December, 2011 and applicable in respect of any dividend declared and paid on or after that date (effective date in section 53(2) of Act 17 of 2009 as substituted by section 148 of Act 7 of 2010)]

Section 64N – Rebate in respect of foreign taxes on dividends

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64N.    Rebate in respect of foreign taxes on dividends

 

(1)     A rebate determined in accordance with this section must be deducted from the dividends tax payable in respect of a dividend contemplated in paragraph (b) of the definition of ‘dividend’ in section 64D.

 

(2)     The amount of the rebate contemplated in subsection (1) is equal to the amount of any tax paid to any sphere of government of any country other than the Republic, without any right of recovery by any person, on a dividend contemplated in subsection (1).

 

(3)     The amount of the rebate contemplated in subsection (2) must not exceed the amount of the dividends tax imposed in respect of the dividend contemplated in subsection (1).

 

(4)     For the purposes of this section, the amount of any tax paid as contemplated in subsection (2) must be translated to the currency of the Republic by applying the exchange rate used to convert the amount of the dividend in respect of which that tax is paid to the currency of the Republic.

 

(5)     A company or regulated intermediary must obtain proof of any tax paid to any sphere of government of any country other than the Republic and deducted from the dividends tax payable in terms of this section, in the form and manner prescribed by the Commissioner.

Section 47C (ITA) – Liability for payment of tax

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47C.    Liability for payment of tax

 

(1)     A taxpayer must, within 30 days (or within such further period as the Commissioner may approve) after an amount contemplated in section 47B is received by or accrues to that taxpayer, pay to the Commissioner the amount of tax which is leviable in terms of this Part in respect of that amount.

 

(2)    This section does not apply to any amounts received by or accrued to the taxpayer-

 

(a)     from which the full amount of tax has been withheld by a resident in terms of section 47D; or

 

(b)     which have been recovered from a resident who is personally liable for the amount in terms of section 47G(1).

“Expenditure” definition of section 46 of ITA

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(b)     For the purposes of this subsection –

 

“expenditure” means in relation to unbundled shares acquired as—

 

(i)      trading stock, the amount taken into account prior to the unbundling transaction in respect of the unbundling shares for the purposes of section 11(a) or 22(1) or (2);

 

(ii)     capital assets, the expenditure incurred prior to the unbundling transaction in respect of the unbundling shares that is allowable in terms of paragraph 20 of the Eighth Schedule;

[Subparagraph (ii) substituted by section 37(1)(c) of Act 17 of 2023 with effect from 1 January, 2024 and applicable in respect of the allocation of expenditure to unbundled shares acquired on or after that date]

 

(iii)     . . . . . .

[Subparagraph (iii) deleted by section 37(1)(d) of Act 17 of 2023 with effect from 1 January, 2024 and applicable in respect of the allocation of expenditure to unbundled shares acquired on or after that date]

[Definition of “expenditure” substituted by section 27(1) of Act 20 of 2021 with effect from 1 January, 2022 and applicable in respect of the allocation of expenditure to unbundled shares acquired on or after that date] 

“Base cost” definition of section 41 of ITA

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“base cost” means the base cost as defined in paragraph 1 of the Eighth Schedule: Provided that where the base cost of an asset as at a specific date is to be determined as contemplated in paragraph 26 or 27 of the Eighth Schedule, the amount thereof must, for purposes of section 42 or 44, be determined as if that asset had been disposed of on that date for an amount received or accrued equal to the market value of that asset as at that date;