Summary
Cross-border Transactions and Natural Persons summary
- Course
- Tax 399 (TAX399)
- Institution
- Stellenbosch University (SUN)
a Summary of natural persons and cross-border transactions
[Show more]
Seller
FollowContent preview
CH 21 – CROSS-BORDER TRANSACTIONSThe Statutory Source Rules – s9
Positive S9(2) – when is a receipt/accrual deemed to be from a source within SA
Negative s9(4) – when is a receipt/accrual NOT deemed to be from a source within SA
Crux From Source in RSA From Source Outside RSA
Dividends Source of dividend income – S9(2)(a) – Dividend received S9(4)(a) – Foreign dividends received
depends on the residence of by/accrued to that person by/accrued to that person
the company that pays the Dividend – paid by a resident Foreign dividend – paid by a foreign
dividend company company
Interest – Source of interest income is Interest is attributable – to an S9(4)(b) – interest that does not meet
s24J determined on 2 bases: amount incurred by a person that is the criteria in s9(2)(b)(i) or (ii)
Residence of person paying a resident – unless the interest is
the interest and attributable to a PE of a resident
Place where the funds/credit outside RSA – s9(2)(b)(i)
obtained is being S9(2)(b)(ii) – interest is received or
used/applied accrued i.r.o utilization or
application in the republic – by any
person of any funds/credit obtained
ito any interest-bearing arrangement
Rental Common law principles: Originating cause – is located in RSA Originating cause – not located in RSA
Income 1. Originating cause of the
rental income
2. Where is the originating
cause located
Amount Depends on – the location of S9(2)(j) – immovable property is S9(4)(d) – amounts derived from the
received immovable property situated in RSA disposal of s9(2)(j) and s9(2)(k) assets
on disposal Includes – disposal of interest are from source outside SA if – the
of or right to immovable amounts do not meet these sections
immovable property as in par 2 of 8th
property Sched
Amounts S9(2)(k)(i) if – the person who Resident s9(2)(k)(i) – Asset not S9(4)(d) – amounts derived from the
received disposes of the asset and effectively connected with disposal of s9(2)(j) and s9(2)(k) assets
from other receives the amount is a permanent establishment of that are from source outside SA if – the
assets – resident resident which is situated outside amounts do not meet these sections
e.g. S9(2)(k)(ii) if – person RSA; AND
movable disposing asset is a non- Proceeds on disposal – not subject
property resident to taxes in any country other than
RSA
Non-resident s9(2)(k)(ii) – asset is
attributable to a permanent
establishment of that non-resident –
which is situated in RSA
, Crux From Source in RSA From Source Outside RSA
Amounts 1. Originating cause of the Originating cause – located in RSA Originating cause – not located in RSA
received income – services
i.r.o rendered
Services 2. Where is the originating
Rendered cause located
Amounts Applies to – lump sums, S9(2)(i) – services rendered in RSA Services rendered – outside RSA
received pensions, annuities paid by Apportion if – services rendered
from retirement funds partly within and partly outside RSA
Retirement Key – where were the services
Funds rendered?
Withholding Taxes
S35A – Withholding Amounts from Payments to Non-resident Sellers of Immovable
Property
Charge – 7.5% - if seller is natural person
- 10% - if seller is a company
- 15% - if seller is a trust or
- Seller can apply for directive from CSARS
Person withholding – buyer of immovable property s35A(1)
Liability – non-resident seller
Return submitted – buyer submits a return with payment
S50A – Withholding Taxes on Interest
Levy of Withholding Tax – 15% of interest as defined in s9(2)(b)
Person withholding – payer of the interest
Liability – foreign person (non-resident)
Exemption of WHT on Interest – s50D
- Interest paid by government or bank
- Interest paid i.r.o listed debt
- Foreign person – physically present >183 days in RSA (12 months preceding payment of
interest) or PS in SA
- -> interest is included in gross income – and exempt ito s10(1)(h)
NO s10(1)(h) Exemption if:
o Foreign person (NP) – is physically present >183 days in RSA or
o Debt of the interest – is connected to PE of foreign person in RSA
o S10(1)(i) is applicable – if s10(1)(h) is NOT applicable
CH 7 – NATURAL PERSONS
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through EFT, credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying this summary from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller laurenabrahams. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy this summary for R99,00. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
53022 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy summaries for 14 years now