CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. South Africa Revises New Voluntary Disclosure Program

South Africa Revises New Voluntary Disclosure Program

by Lorys Charalambous,, Cyprus

22 July 2016

The South African National Treasury and the South African Revenue Service (SARS) are inviting further comments on the details of the special voluntary disclosure program (SVDP) that was announced on February 24 in the 2016 Budget.

With the 2017 deadline for the international exchange of tax information through the OECD's Common Reporting Standard in mind, the 2016 Budget specified that additional relief will be offered to non-compliant taxpayers to voluntarily disclose their offshore assets and income. The SVDP will run for six months from October 1, 2016, to March 31, 2017.

Following additional amendments after previous consultations on the 2016 Draft Rates and Monetary Amounts and Amendment of Revenue Laws Amendment Bill and the 2016 Draft Rates and Monetary Amounts and Amendment of Revenue Laws (Administration) Bill, which contain details of the SVDP, comments on the revised drafts are now requested by close of business on August 8, 2016.

To simplify the SVDP, the amendments now include the calculation of only one amount to be included in taxable income and subject to tax in South Africa. That amount will be equal to 50 percent of the highest value of the aggregate of all assets held by a taxpayer outside South Africa between March 1, 2010, and February 28, 2015.

The undeclared income that originally gave rise to those assets will be exempt from income tax, donations tax, and estate duty liabilities that should have arisen in the past. However, future income will be fully taxed, and declared assets will remain liable for donations tax and estate duty in the future, should the applicant donate these assets or die while holding them.

Settlors, donors, deceased estates, and beneficiaries of foreign discretionary trusts may participate in the SVDP if they elect to have the trust's offshore assets and income deemed to be held by them. Taxpayers who disposed of any foreign-held assets prior to March 1, 2010, may also apply for relief under the SVDP, and special deeming provisions will apply in this regard.

Persons may not apply for the SVDP if they are aware of a pending audit or investigation in respect of foreign assets or foreign taxes, or if such an audit or investigation has commenced. In addition, amounts in respect of which SARS has obtained information under the terms of any international exchange of information procedure will not be eligible for the SVDP.

Any non-compliance with respect to value-added tax, pay as you earn (PAYE) tax, unemployment insurance fund contributions, and skills development levies will not qualify for the SVDP. However, relief for penalties associated with non-compliance with these taxes will continue under the existing voluntary disclosure program in terms of the Tax Administration Act, 2011.

TAGS: individuals | South Africa | compliance | tax | tax compliance | law | trusts | ministry of finance | tax authority | offshore | legislation | offshore trusts | penalties | legislation amendments | individual income tax | Africa | Tax

To see today's news, click here.


Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »

Stay Updated

Please enter your email address to join the mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.

To manage your mailing list preferences, please click here »