Week 4 - Exemptions

Question 1

local interest exemption for non-res requirements?

Answer 1

recipient must not have, in the 12 months preceding accrual date:
- been in SA more than 183 days
- carried on bus in SA through permanent establishment
- cannot be annuity

Question 2

interest withholding tax for non-res?

Answer 2

15%

Question 3

local int exemption for residents?

Answer 3

s10(1)(i)
under 65 = R23800
over 65 = R34500

Question 4

local dividends exemption?

Answer 4

• s10(1)(k)
• not an annuity
• remember withholding tax of 20%

Question 5

fully exempt foreign dividends?

Answer 5

• if shareholding is more than 10% of shares
• only for res

Question 6

partially exempt foreign divs?

Answer 6

• only for residents
• natural person = div x 25/45
• others = div x 8/28

Question 7

tax free investment requirements for exemption?

Answer 7

• all interest fully exempt

Question 8

persons employed outside of RSA

Answer 8

fully exempt remuneration if they were outside RSA for:
- a period exceeding 183 days during any 12m period
- a continuous period of 60 full days during the period
- services rendered outside RSA
- ltd to 1 million

Question 9

bursary exemption for employee

Answer 9

at a recognized insitiute. fully exempt if employee agrees to reimburse employer if they don’t complete the course

Question 10

bursary exemption for employee’s relative

Answer 10

• full amt incl in gross income
• if remuneration proxy > R600k, not exempt
• if < R600 000 : first 20k exempt if not finished matric
• first 60k for post matric studies

Question 11

bursary exemption for someone with a disability

Answer 11

if less than R600k:
- first 30k for not fin matric
- first 90k for post matric

Question 12

purchased annuity?

Answer 12

Y = A/B x C
A = amount given to purchase
B = total exp. receipts
C = amt. incl. into GI this year

Question 13

cancelled annuity?

Answer 13

X = A-D
A = cash cost of annuity
D = all exemptions granted to date