Thesis (MComm)--Stellenbosch University, 2004. / ENGLISH ABSTRACT: The aim of this study is to determine the applicability of the various South African Income Taxation Act sections on the deduction of software costs. A distinction is made between the various deduction sections in the Income Taxation Act that are applicable to software costs. By doing this an appropriate taxation deduction is recommended for the different types of software costs that the taxpayer incurs. Software assets and expenditure can be divided into various categories based on the acquisition agreement. The rights and assets that are obtained, differ for each category of software cost. In some instances a copyright is obtained and in other instances only a right of use is obtained. Furthermore the taxpayer receives intellectual property, an intangible asset, and/or a tangible asset. A literature study and an analysis of the different types of software costs and the four concerned Income Taxation Act sections serve as background for the consideration of the applicability of each specific deduction section in the Income Taxation Act on the various categories of software costs. By using the information obtained in the literature study and the analyses, a recommendation is made of the most applicable deduction article for each category of software cost. / AFRIKAANSE OPSOMMING: Hierdie studie het ten doel om die toepaslikheid van die verskillende Suid-Afrikaanse Inkomstebelastingwetsartikels, op die aftrekking van sagtewarekoste te bepaal. 'n Onderskeid word getref tussen die verskillende aftrekkingsartikels wat van toepassing is op sagtewarekoste in die Inkomstebelastingwet. Sodoende word 'n geskikte belastingaftrekking vir die verskillende tipes sagtewarekoste voorgestel wat deur elke belastingpligtige aangegaan word. Sagtewarebates of -uitgawes kan in verskillende kategoriee verdeel word na aanleiding van die verkrygingsooreenkoms wat aangegaan is. Die regte en bates wat verkry word verskil ten opsigte van elke kategorie sagtewarekoste. In sommige gevalle word 'n outeursreg verkry en in ander gevalle slegs 'n gebruiksreg. Verder kan of intellekuele eiendom, 'n ontasbare bate, en/of 'n tasbare bate verkry word. 'n Literatuurstudie en analise van die verskillende tipes sagtewarekoste en die vIer betrokke Inkomstebelastingwetsartikels dien as agtergrond vir die oorweging van die toepaslikheid van elke spesifieke aftrekkingsartikel in die Inkomstebelastingwet op die onderskeie kategoriee sagtewarekoste. Daama word die inligting wat bekom is in die literatuurstudie en analise gebruik om die mees toepaslike aftrekkingsartikel vir elke kategorieë sagtewarekoste voor te stel.

Thesis (MComm) -- Stellenbosch University, 2008. / ENGLISH ABSTRACT: The September 2007 decision of the SCA in C: SARS v Brummeria Renaissance (Pty) Ltd and Others has proven to be one of the most contentious tax cases ever decided by a court in our jurisdiction. Questions surrounding the interpretation of the judgment and the likely scope of its application are some of the most widely debated matters in South African tax circles ever since the judgment was delivered. In this research paper a study is undertaken into the income tax treatment of an interest-free loan receipt. The position as it stood prior to the SCA decision is first analysed with particular reference to the legal nature of a contract for the loan of money and the tax court decision in ITC 1791. The discourse continues with a critical discussion of the Brummeria judgment in order to extract the ratio decidendi thereof. The ambit of application of the extracted binding principles to selected interest-free loans (encountered most often in practice) is considered, drawing on views expressed by numerous South African tax experts as well as the Revenue Authority’s own stance in this regard, as enunciated in their Draft Interpretation Note dealing with the right to use loan capital interest-free. As a final application a study is undertaken into the possible arguments available to tax subjects to refute an assessment for income tax raised on them by SARS on the basis of the binding principles enunciated by the SCA in Brummeria. It is concluded that initial fears regarding the potential wide-ranging impact of the decision, though justified, may have been over-anticipated as strong grounds exist to argue that the scope of the judgment’s application is not likely to extend wider than the type of legal construction found in the case itself, namely where an interest-free loan is received in consideration or as a quid pro quo for some or other revenue supply. / AFRIKAANSE OPSOMMING: Die beslissing van die Hoogste Hof van Appèl (“HHA”) in C: SARS v Brummeria Renaissance (Pty) Ltd and Others gedurende September 2007 blyk een van die mees omstrede belastingsake te wees wat tot nog toe in ons jurisdiksie beslis is. Kwelvrae rondom die interpretasie van die uitspraak sowel as die waarskynlike omvang van die toepassing daarvan is van die aangeleenthede wat die wydste gedebateer is in Suid-Afrikaanse belastingkringe in die onlangse verlede. In die studie word die inkomstebelasting hantering van die ontvangs van 'n rentevrye lening ondersoek. Die regsposisie voor die beslissing van die HHA word eers ontleed met spesifieke verwysing na die regsaard van 'n kontrak vir die leen van geld en die beslissing van die spesiale inkomstebelasting hof in ITC 1791. Die verhandeling gaan voort met 'n kritiese bespreking van die Brummeria uitspraak ten einde die ratio decidendi daarvan te ekstraheer. Die bestek van die toepassing van die saak se bindende beginsels op uitgesoekte rentevrye lenings (wat die meeste in die praktyk teёgekom word) word oorweeg. In dié verband word verwys na die menings van verskeie Suid-Afrikaanse belasting-deskundiges, sowel as die Ontvanger van Inkomste se eie seining in hierdie verband, soos uiteengesit in hul Konsep Interpretasienota met betrekking tot die reg om leningskapitaal rentevry te gebruik. In die laaste instansie word „n ondersoek geloods na die moontlike argumente wat belastingpligtiges sou kon aanvoer om 'n inkomstebelasting-aanslag gegrond op die bindende beginsels neergelê deur die HHA in Brummeria, te weerlê. Dit word bevind dat aanvanklike vrese aangaande die trefwydte van die beslissing, alhoewel geregverdig, moontlik oorversigtig was, aangesien daar sterk gronde is om te argumenteer dat die omvang van die uitspraak se toepassing waarskynlik beperk is tot die soort regskontruksie wat in die saak self aangetref word, naamlik waar 'n rentevrye lening ontvang word in ruil vir of as quid pro quo (teenprestasie) vir een of ander lewering van 'n inkomste aard.

M.Com. (South African and International Taxation) / The term “beneficial ownership” was first included in Articles 10, 11 and 12 of the OECD’s Model Tax Convention in 1977 but it is not defined in the OECD’s Model Tax Convention and most countries do not have a definition in their domestic tax laws. There is a need for South African revenue authorities to consider how the concept of beneficial ownership will be applied in an international tax context especially with the introduction of withholding tax on dividends and the pending implementation of withholding tax on interest. A review and analysis of interpretation principles from the Vienna Convention, the OECD, selected countries and experts revealed that there are common interpretation principles which are being applied consistently when determining beneficial ownership for international tax purposes. When applied against relevant, recent international tax case law, it was interesting to note that these common interpretation principles did not consistently yield results which were in line with the courts’ judgements. The common interpretation principles represent attributes which can be used to determine beneficial ownership in international tax and could prove useful to South African revenue authorities in constructing a domestic definition for “beneficial ownership.”

Presented to the School of Accountancy University of the Witwatersrand, Johannesburg This research report is submitted to the faculty of Commerce, Law and Management in partial fulfilment of the requirements for the Degree of Master of Commerce (specialising in Taxation) Date: 31 March 2016 / This research focuses on large corporate transactions and acknowledges that they play a significant role in the allocation of resources in society. For this reason (1) the composition of firms’ capital structure and (2) how they choose to fund their investments are important. The South African income tax system has a bias towards debt and this bias (1) distorts the financing and investment decisions of firms; and (2) creates international tax arbitrage opportunities. These circumstances are not exclusive to South Africa. In order to address these distortions and loopholes the National Treasury and the SARS Commissioner have introduced complicated interest deduction limitations. This research critically analyses (1) the new adjusted tax rules concerning interest deduction limitations in finance transactions and (2) whether these new rules encourage investment. To assist with this critical analysis we use corporate finance theory to examine debt push-down transactions/structures because these structures are seen as highly tax-efficient for investors (both foreign and local). This research demonstrates that there are many different ways to finance a transaction but ultimately the choice of finance lies along the continuum between the issue of debt or equity. From an economic perspective this research confirms that there is no material reason for the disparate treatment between debt and equity. However from a legal perspective debt and equity instruments are materially distinct and thus tax considerations are influential in selecting the form of finance used in a transaction. This research not only concludes that leverage transactions utilising excessive debt pose a risk to tax revenues, tax sovereignty and tax fairness but also that the artificial statutory treatment of interest deductions on leverage transactions and working capital facilities means that (1) firms’ ability to finance their operations is reduced, (2) the value of firms is reduced and (3) the incentive for investors to invest in South Africa is also reduced. / MT2017

Thesis (M.Com. (Taxation))--University of the Witwatersrand, Faculty of Commerce, Law and Management, School of Accountancy, 2017 / Share incentive schemes have been used for many years as a mechanism to compensate, retain and attract talent by offering employees a stake in the business. Share incentives, however, usually contribute an increasingly larger portion of executive pay in comparison with general employees. The motive for larger share incentive based compensation is on the foundation that management must have a skin in the game in order for their interest to be appropriately aligned with shareholders. The Treasury and the South African Revenue Service (‘SARS’) have historically viewed share incentive schemes with suspicion. Treasury and SARS consider these schemes as salary conversion plans designed avoid tax. This has led to a litany of tax legislation that has sought to combat this so called avoidance. As things stand it appears the legislation is far too reaching and no longer reflects the commercial and economic reality of an increasingly entrepreneurial world. The aim of this research report is to ascertain whether the current tax policy is effectively discouraging employee share ownership. This paper will consider the impact of the current tax provisions on share incentive schemes for both the employees and their companies’. The United Kingdom offer tax advantages for employee share ownership plans thus the report will also include a comparison with the tax legislation governing share option schemes in the UK. The comparison will aid in recommending a more sensible and equitable way forward with regards to the taxation of share incentive schemes in South Africa. Key words: Share incentive plans, Section 8B, Section 8C, executive remuneration, equity based compensation / GR2018

M. Tech. Business Information Systems / The operation and management of privately-owned public transport (the taxi industry to be precise) in many countries, South Africa included; is increasingly challenging. Over the years, the taxi industry in South Africa has been characterized by many challenges such as violence, resulting from maladministration and lack of regulations. In addition, this could be attributed to irregularities and lack of formal approach within which the privately-owned public transport (taxi) operates. Another problem with the irregularities in the industry is handling physical cash by taxi drivers. This creates room for funds spillage and financial management challenges, resulting in conflict between taxi drivers and their employers. There is also an issue of taxation, which is a challenge to the Government. Due to the irregularities, the way in which the industry is operated, the operators have failed to comply. The goal of this research is to develop an ICT seamless Model for handling electronic payment for privately-owned public transportation in Gauteng.

This treatise tests the effectiveness of withholding taxes imposed by the South African tax authorities with respect to amounts paid from a South African source to a non-resident in respect of interest, royalties and foreign entertainers and sportspersons. The first research objective discusses the alignment of the meaning of words and phrases in both the domestic law of South Africa and Double Tax Agreements (DTA.) The second issue outlines whether the DTA supports the domestic law through the waiving of tax claims in favour of the country of source. In last instance the attribution of income is discussed. The interpretation attached to the words for the purpose of levying normal tax, serves as the methodology for identifying inconsistencies with the levying of withholding tax. The wider scope of withholding taxes with respect to the meaning of ‘interest’, ‘royalties’ as well as ‘foreign entertainer and sportsperson’ misaligns with the corresponding meaning of it in the DTA. This creates the risk that amounts paid to non-residents will either not be subjected to withholding tax in the source state or that the income will be taxable in the resident state as a result of the application of other articles of the DTA. DTA’s concluded between South Africa and other countries are based on the OECD Model Tax Convention. These DTA’s tend to favour the residence state with respect to the waiving of tax claims. The source state’s right to collect withholding tax on income from royalties and interest is prevented if the foreign person is physically present in South Africa for more than 183 days and if the interest/royalty payment is effectively connected with a permanent establishment in South Africa. The domestic law and DTA are misaligned with respect to the attribution of interest and royalty income since the recipient of the income for the purpose of the domestic law is not necessarily the beneficial owner of the debt claim or intellectual property. It can therefore be recommended that South Africa must renegotiate DTA’s to favour taxation in the source state. Withholding tax provisions must also be redrafted to align them with the DTA meaning.

In this project, the researcher evaluates revenue collection and allocation challenges faced by South African Municipalities in the case of NDLAMBE Local Municipality and this research project consist of five Chapters. Chapter one introduces and outlines the setting of the study and also provides the problem statement, research questions, research objectives and significance of the study. The chapter further clarifies the key concepts and terms that were used in the study, delimitation and limitations of the study. Chapter two provides a critical discussion of the concept of revenue collection and allocation, focusing on the various perspective of revenue. A source of municipal revenue and revenue collection and allocation model is explained as well as theoretical framework that guides it. Chapter three gives an account of the research design and methodology used in the study and in this study the researcher used the qualitative research approach as a data collection technique and document surveys were used because it is cheap and it saves time. The chapter also highlights the revenue collection and allocation applicable to the study and conclude by discussing the data analysis techniques that were used in the empirical study. Chapter four dealt with the data analysis of data collected presentation and discussion of the results and the researcher analyzed data using the filtering technique and content analysis. Chapter five drew conclusions and made scientific recommendations based on the research findings.The municipality is largely dependent on grants from upper spheres of government and generate less than 20 percent of current expenditures from own resources. As a whole, the revenue collection and allocation challenge of the NDLAMBE Local Municipality, given the current scenario of flows, is a reason for concern. Due to historical and political factors, local governments in South Africa differ substantially in terms of potential revenue base, but it may be that in many cases potential revenue is not exploited and that the high level of dependency on grants, high level of bad debts and lack of political will to be more self-reliant is the result of poor revenue in NDLAMBE Local Municipality.

In this project, the researcher evaluates revenue collection and allocation challenges faced by South African Municipalities in the case of NDLAMBE Local Municipality and this research project consist of five Chapters. Chapter one introduces and outlines the setting of the study and also provides the problem statement, research questions, research objectives and significance of the study. The chapter further clarifies the key concepts and terms that were used in the study, delimitation and limitations of the study. Chapter two provides a critical discussion of the concept of revenue collection and allocation, focusing on the various perspective of revenue. A source of municipal revenue and revenue collection and allocation model is explained as well as theoretical framework that guides it. Chapter three gives an account of the research design and methodology used in the study and in this study the researcher used the qualitative research approach as a data collection technique and document surveys were used because it is cheap and it saves time. The chapter also highlights the revenue collection and allocation applicable to the study and conclude by discussing the data analysis techniques that were used in the empirical study. Chapter four dealt with the data analysis of data collected presentation and discussion of the results and the researcher analyzed data using the filtering technique and content analysis. Chapter five drew conclusions and made scientific recommendations based on the research findings.The municipality is largely dependent on grants from upper spheres of government and generate less than 20 percent of current expenditures from own resources. As a whole, the revenue collection and allocation challenge of the NDLAMBE Local Municipality, given the current scenario of flows, is a reason for concern. Due to historical and political factors, local governments in South Africa differ substantially in terms of potential revenue base, but it may be that in many cases potential revenue is not exploited and that the high level of dependency on grants, high level of bad debts and lack of political will to be more self-reliant is the result of poor revenue in NDLAMBE Local Municipality.

The objective of the study was to investigate the right of the South African Government to tax the income earned by a foreign company when rendering services in South Africa to a South African associated enterprise on a recurrent basis, together with the right to tax the amounts paid to the employees of the permanent establishment for services rendered in South Africa. At the same time the research investigated whether the services rendered by a foreign company to an associated enterprise in South Africa on a recurrent basis would constitute a permanent establishment, as this is essential before South Africa may tax either the foreign company or the employees of the permanent establishment (where such employees are not resident in South Africa).The research was conducted by means of a critical analysis of documentary data and data from a limited number of interviews with academics and the authors of textbooks and articles. In order to limit the scope of the research, a number of assumptions were made. Conflicting viewpoints underlying certain of these assumptions were discussed. Some of the important conclusions reached are that the provisions of the Vienna Convention on the Law of Treaties should be taken into account when interpreting South African legislation (including Double Tax Agreements), and that the Organisation for Economic Cooperation and Development (OECD) Commentary may be relied upon when interpreting OECD based Double Tax Agreements in South Africa. No conclusion was reached on whether to apply an ambulatory or a static basis of interpreting the OECD Commentary, however. The final conclusion of the research is that the services rendered in South Africa on a recurrent basis would be geographically and commercially coherent and consequently meet the "location test'. It is clear that as the services are rendered regularly and recurrently, they would be regarded as having the necessary permanence and would meet the 'duration test'. The place of business would therefore be regarded as being fixed (having the necessary degree of permanence). As the services would be rendered at the place of business of the South African entity, they would be regarded as being rendered 'through' the place of business and the foreign entity would be regarded as having a permanent establishment in South Africa (as defined in Article 5(1) of the OECD Model Tax Convention}. The South African Government would therefore be entitled to tax the income attributable to the permanent establishment and the income earned by the non resident employees, who rendered services in South Africa for the permanent establishment. Once the entitlement to tax exists, South African legislative rules determine how South Africa proceeds to tax the income.