2012/2013 Tax Card

TAX TABLES

Year of assessment ending 28 February 2013

Individuals, Deceased Estates and qualifying Trusts

Taxable Income (R) Rates of tax (%)
0 – 160 000 18% of each R1
160 001 – 250 000 28 800 + 25% of amount over 160 000
250 001 – 346 000 51 300 + 30% of amount over 250 000
346 001 – 484 000 80 100 + 35% of amount over 346 000
484 001 – 617 000 128 400 + 38% of amount over 484 000
617 001 and above 178 940 + 40% of amount over 617 000

Trusts other than special trusts and testamentary trusts

Rate of tax: 40%

Rebates

2013 2012
R R
Primary 11 440 10 755
Secondary – 65 and older 6 390 6 012
Third – 75 and older 2 130 2 000

Threshold at which tax liability commences

2013 2012
R R
Below 65 63 556 59 750
65 and older 99 056 93 150
75 and older 110 889 104 261

EXEMPTIONS

Interest

R22 800 (2012: R22 800) per taxpayer on interest and foreign dividends.

R33 000 (2012: R33 000) per taxpayer 65 and older.

Interest is exempt where earned by non-residents who are absent from SA for 183 days or more p.a. and who are not carrying on business in SA.

Dividends – local and foreign

With effect from 01/04/2012 most dividends received from SA resident companies by local residents are subject to withholding tax of 15%.

Net foreign dividends and interest received are included in taxable income and are only exempt to a maximum of R3 700 of the total interest exemption as mentioned above.

Foreign dividends received by individuals are taxable at a maximum effective rate of 15%.

With effect from 01/03/2012, if a SA resident holds more than 10% of the equity share capital in the foreign company declaring the dividend, any foreign dividends received by the resident will be exempt from tax.

CAPITAL GAINS TAX (CGT)

Only gains accruing after 01/10/2001 on the disposal of assets, death, donation, exchange, loss or emigration are subject to CGT, subject to certain exemptions.

The first R30 000 (2012: R20 000) per annum of the capital gain or loss realised by individuals and special trusts is exempt from CGT or R300 000 (2012: R200 000) in the year of death.

Withholding tax for non-residents on sale of SA immovable property costing >R2m: 5% for natural persons, 7,5% for companies and 10% for trusts.

If proceeds from sale of primary residence is R2m or less it is exempt; else exemption of R2m (2012: R1,5m) of the capital gain will apply to primary residence disposals if less than 2 hectares.

Taxpayer Inclusion rate (%) Effective (%)
Individuals 33.3 0 – 13.3
Trusts 33.3 – 66.6 5.9 – 26.7
Companies 66.6 0 – 18.6

PROVISIONAL TAX

The following individuals are not required to register for provisional tax purposes:

Individuals below the age of 65 who earn taxable non-employment income of R20 000 or less p.a.

Individuals aged 65 and older if their annual taxable income consists exclusively of remuneration, interest, dividends or rent from the lease of fixed property and is R120 000 or less p.a.

DEDUCTIONS

Current pension fund contributions

Greater of:

  • 7,5% of income from retirement funding employment, or
  • R1 750.

Any excess may not be carried forward to the following year of assessment.

Arrear pension fund contributions

Maximum of R1 800 p.a.  Any excess may be carried forward to the following year of assessment.

Current retirement annuity fund contributions

The greater of:

  • 15% of taxable income from non-retirement funding employment, or
  • R3 500 less current deductible contributions to a pension fund, or
  • R1 750.

Any excess may be carried forward to the following year of assessment.

Arrear retirement annuity fund contributions

Maximum of R1 800 p.a.  Any excess may be carried forward to the following year of assessment.

Limits for Retirement Fund contributions to be amended from 01/03/2013.

Medical and physical disability expenses (including medical aid contributions)

Taxpayers 65 and over, unlimited qualifying expenditure allowed.

From 01/03/2012, taxpayers under 65 may include medical tax credits in determining tax payable of up to R230 for each of the first two dependants on their medical scheme and R154 for each additional dependant.  In determining taxable income they may claim a deduction for medical scheme contributions which exceeds four times the medical tax credit and any other medical expenses limited to the amount which exceeds 7,5% of taxable income (excluding retirement fund lump sums). The previous ‘capped amounts’ fell away on 29/02/2012.

Taxpayers under 65 may claim all qualifying medical expenses, where the taxpayer, his spouse, or his child or stepchild is defined as a handicapped person.

Donations

Donations to certain public benefit organisations are limited to 10% of taxable income before deducting medical expenses.

LIMITATION OF EMPLOYEE DEDUCTIONS

Losses from secondary trades, incurred by individuals whose income exceeds R617 000 (2012: R580 000) p.a, are ring fenced in certain circumstances.

FRINGE BENEFITS

Company car

Tax at 3,5% p.m. (3,25% p.m. where maintenance plan) on determined value (Cash cost including VAT).

A logbook must be maintained to substantiate the actual and business mileage travelled for the year, to reduce the fringe benefit on assessment.

If the employee has borne the cost of license, insurance, maintenance and fuel for private travel and the private distance travelled is substantiated by a logbook, further relief is available on assessment.

80% of the fringe benefit is subject to PAYE on a monthly basis. If the employer is satisfied that at least 80% of the use of motor vehicle in the tax year is for business, the percentage is reduced to 20%.

Travel allowance

Deemed expenditure rates, which may be used in determining the allowable deduction for business travel, where actual costs are not used, are as follows:

Value of the vehicle(including VAT)
(R)
Fixed cost 
R
Fuel cost
c/km
Maintenance cost
c/km
0 –   60 000 19 492 73,7 25,7
60 001 – 120 000 38 726 77,6 29,0
120 001 – 180 000 52 594 81,5 32,3
180 001 – 240 000 66 440 89,6 36,9
240 001 – 300 000 79 185 102,7 45,2
300 001 – 360 000 91 873 117,1 53,7
360 001 – 420 000 105 809 119,3 65,2
420 001 – 480 000 119 683 133,6 68,3
Exceeding  480 000 119 683 133,6 68,3

Notes

The fixed cost is reduced on a pro-rata basis if the vehicle is used for business purposes for less than a full year.

A logbook must be maintained to substantiate the actual mileage and business mileage travelled for the year to claim against a travel allowance received.

No employees tax is payable on a reimbursive allowance paid by an employer to an employee, where the employee does not receive a travel allowance, if the annual distance travelled for business purposes and the rate per km does not exceed 8 000 kms or 316c per km.

80% of the travel allowance is subject to PAYE on a monthly basis. If the employer is satisfied that at least 80% of the use of motor vehicle in the tax year is for business, the percentage is reduced to 20%.

Interest-free or low-interest loans

Included in gross income: the difference between interest at the official rate and the actual amount of interest charged.  The current official rate of interest is 6.5% p.a. (7.5% from 01/10/2010 – 28/02/2011).

Subsistence allowance

Where the employee is by reason of his duties obliged to spend at least one night away from his usual place of residence, the employee is deemed to have expended:

  • R93 (2012: R88) p.d if the allowance or advance is granted to pay for incidental costs only, or
  • R303 (2012: R286) p.d if the allowance or advance is granted to pay for the cost of meals and incidental costs, or
  • Where the allowance or advance is granted to pay for incidental costs only for travel outside the Republic (not exceeding six weeks) the applicable country’s rate per day must be used.

COMPANIES

Corporate Tax Rates

Entity 2013* 2012
  • Companies
28% 28%
  • Closely held companies
40% 40%
  • Foreign Company Branch
33% 33%
  • Employment Company
28% 33%
Small Business Corporations
    • R0 – R63 556 (2012: R59 750)
0% 0%
    • R63 556 – R350 000(2012:  R59 750 – R300 000)
10% 10%
    • R 350 001 and above
28% 28%

* Rate changes effective for years of assessment ending on or after 01 April 2012.

Small Business Corporations (SBC)

  • From 01/04/2006, the turnover limit is R14m.
  • Depreciation write-off at 50:30:20% rate for all depreciable assets.
  • Manufacturing assets immediate 100% write-off.
  • SBC’s include personal services entities, provided that the business maintains at least 3 full-time employees for core operations.
  • CGT tax relief for small businesses is R1,8m (2012: R900 000).

Turnover Tax for Micro Businesses

Taxable Income (R) Rates of tax (%)*
0 – 150 000 0%
150 000 – 300 000 1% of amount over 150 000
300 000 – 500 000 1 500 + 2% of amount over 300 000
500 000 – 750 000 5 500 + 4% of amount over 500 000
750 000 and above 15 500 + 6% of amount over 750 000

Rate changes effective for years of assessment ending on or after 01 April 2012.

Micro Business is defined as a business with a qualifying turnover that does not exceed R1m for a year of assessment and, which is not specifically disqualified from making use of the turnover tax.

The first R200 000 dividends paid during a tax year by the Micro Business is exempt from Dividends Tax.

Secondary Tax on Companies (STC & Dividends Tax)

  • Secondary Tax on Companies (STC) has been replaced by Dividends tax from 01/04/2012.
  • Any un-utilised STC credits will expire on 31/05/2015.
  • Dividends tax is imposed at 15% on dividends declared and paid by resident companies and certain non-resident companies.
  • To be withheld by companies paying the taxable dividend or by regulated intermediaries (ie listed shares) – certain exemptions apply.

Wear and tear allowances

  • Any asset costing less than R7 000 excl. VAT may be written off in full in the year of acquisition where purchased on or after 01/03/2009.
  • CGT and income tax recoupment relief if sale proceeds of movable depreciable business assets reinvested in other movable assets within 12 months.

Energy Efficiency Incentive

Investment by companies in energy-efficient equipment should qualify for an additional allowance of up to 15% on condition that there is documentary proof of the resulting energy efficiencies, certified by the Energy Efficiency Agency.

CO2 Vehicle Emission Tax

New passenger cars are taxed based on their certified CO2 emission at specified rates.

OTHER TAXES

Skills Development Levies (SDL)

All employers paying annual remuneration of less than R500 000 will be exempt from SDL.

Unemployment Insurance Fund Contributions (UIF)

UIF is payable monthly by employers, 1% by employers and 1% by employees, based on employees’ remuneration below a certain amount.

Employers not registered for PAYE or SDL purposes must pay the contributions to the Unemployment Insurance Commissioner.

Value-Added Tax (VAT)

Standard-rated supplies 14%
Zero-rated supplies 0%
Exempt supplies Exempt
Turnover level for VAT registration Compulsory after R1m p.a. achieved
or likely to be achieved.
Voluntary minimum of R50 000 p.a. or R60 000 p.a. for commercial accommodation.

Transfer duty

Payable on the purchase of property or shares/contingent rights in residential property owning companies/trusts not subject to VAT at the following rates:

By all persons on or after 01/03/2011

Value of Property (R) Rates of tax (%)
0  –   600 000 0%
600 001 – 1 000 000 3% on value above    600 000
1 000 001 – 1 500 000 12 000 + 5% on value above 1 000 000
1 500 001 and above 37 000 + 8% on value above 1 500 000

Donations tax

Levied at a flat rate of 20%

Exemptions:

  • R100 000 p.a. donated by natural persons
  • R10 000 p.a. in case of person who is not a natural person
  • Donations between spouses and to certain public benefit organisations.

Estate duty

Levied at flat rate of 20% on all property of SA residents and SA property of non-residents.

Primary abatement of R3,5m.

RETIREMENT FUND LUMP SUM WITHDRAWAL BENEFITS

Taxable Income (R) Rates of tax (%)
0 –    22 500 0%
 22 501 – 600 000 18% of amount over 22 500
600 001 – 900 000 103 950 + 27% of amount over 600 000
900 001 and above 184 950 + 36% of amount over 900 000

RETIREMENT FUND LUMP SUM BENEFITS – RETIREMENT/RETRENCHMENT

Taxable Income (R) Rates of tax (%)
0 – 315 000 0%
315 000 – 630 000 18% of amount over 315 000
630 000 – 945 000 56 700 + 27% of amount over 630 000
945 001 and above 141 750 + 36% of amount over 945 000

The tax payable on a retirement fund lump sum during a year of assessment is determined by aggregating all retirement fund lump sum benefits received from 01/10/2007 (and all severance benefits received or accrued since 01/03/2011).

SECURITIES TRANSFER TAX

Tax levied at a rate of 0.25% on the transfer of listed or unlisted securities, consisting of shares in companies or member’s interest in close corporations.

EXCHANGE CONTROL

  • Resident individual taxpayer over 18 – foreign capital investments p.a.R 4m
  • Travel and studies:
    • Per adult p.a. (over 18 years)R 1m
    • Per child p.a. (under 18 years)R200 000

INTEREST RATES

Prime bank overdraft rates

Date of change Rate p.a
23 March 2010 10%
10 September 2010 9.5%
19 November 2010 9%

SARS prescribed rates of interest as at 01 March 2012

Fringe benefits – interest free or low-interest loans 6.5% p.a.
Late or under payments of tax 8.5% p.a.
Refunds of overpayments of provisional tax 4.5% p.a.
Refunds of tax upon successful appeal 4.5% p.a.
Late payments of VAT 8.5% p.a.
Refund of VAT after prescribed period 4.5% p.a.

Disclaimer

Please do not act on any of this information without contacting your partner.

Whilst every care has been taken in the presentation of this information, no responsibility of any nature whatsoever shall be accepted for any inaccuracies, errors or omissions.

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