In the mid-nineteenth century, the assessment of the income tax was entrusted to personnel who were independent of the Board of Inland Revenue and this constitutional division between local and central authority was the corner-stone of the Victorian income tax. It was envisaged that the punishment for evasion, too, should be dealt with essentially at a local level and the statute provided for several different means by which this could be achieved. It soon became clear, however, that such a system was ill-equipped to deal adequately with under- or non-assessment, because the sanctions by which penalties could be imposed were ineffectual both as a deterrent and as a punitive measure in instances of substantial and protracted evasion. In the third quarter of the nineteenth century, events occurred through which the Board was able, effectively, to seize the reins of assessment and to forge a method of punishment for evasion and it is this extra-statutory scheme which formed the nucleus of the modern system of punishing income tax evasion. The dissertation begins in 1842, the year in which the income tax was re-introduced as a temporary visitant and ends in 1880, the year in which the management of the income tax was mapped out as, more or less, a permanent feature of the fiscal scene. During this period, the method of dealing with tax evasion metamorphosed from one which was, in the main, in the grasp of the local administration to-one which was largely in the hands of the Inland Revenue Department. That this change took place without legislative intervention was the culmination of the social and administrative stresses and tensions that were tested by the operation of the income tax, which it is the purpose of this dissertation to explore.

This document entitled Professional Education and Training of Valuers is submitted for the award of Doctor of Philosophy by publication and comprises an overview based on twenty publications by the candidate and the research which underpins those publications. The publications are presented within the themes of property taxation, the mutual recognition of professional qualifications and the teaching of valuation. The development of the research from the earlier work which led to an MPhil award is clearly identified. The reflective overview is divided into five sections. Section one introduces the work and analyses the publications. Section two describes and critically examines the research methodology which underpins the publications and the research from which they emerged. Section three demonstrates the co-herence of the submission, while identifying the key issues within the publications. Section four identifies the specific contributions to knowledge which the candidate has made and describes how the research will be developed in the future; and section five provides a brief closing statement.

M.Comm. / The purpose of this study is to determine the tax implications of mergers and acquisitions. and more specifically the tax implications of the selling and purchasing of assets and shares. Mergers and acquisitions Mergers and acquisitions are two methods to combine companies. Both will lead to a business combination. It can mean that either the assets or the shares of the acquiree are purchased. The sale and purchase of assets or shares When two or more companies decide to merge. the one company can acquire the assets of the other compan). The purchase and sale of intellectual property and goodwill are important during mergers and acquisitions. Other assets like trading stock. debtors and bad debts and fixed assets will also be purchased and sold.

M.Com. (Taxation) / The purpose of this study is to determine the desirability of the implementation of a system of self-assessment in South Africa. The current system has several shortcomings and self assessment might be an improvement. Several of the developed countries have already gone onto self-assessment systems. These countries include The United States of America, Japan, Australia and the United Kingdom. A self-assessment system The Margo Commission recommended a self-assessment system in their report on the tax structure of South Africa. They motivated this recommendation as follows: "Under a system of self assessment, taxpayers would perform functions which are at present being discharged by assessors. With that responsibility shifted from assessor to taxpayer, Inland Revenue could confine it self to a selective audit of cases which would be much more productive in respect of revenue and manpower." (Margo Report, 1986:para 28.37) A self-assessment system is in short a system where the taxpayer computes his/her tax liability, completes the relevant forms and sends the payment together with the forms to the Revenue Authorities. The Revenue Authorities apply scientifically developed selection methods to select taxpayers to be audited. The Office of the Commissioner will then be able to concentrate his limited resources on revenue producing sectors and those sectors where the possibility of tax evasion are perceived to be the biggest. In this way more tax can thus be collected. The Margo Commissions' report appeared in 1986. With the obvious advantages of a self assessment system one tends to wonder why this system has not been implemented yet. Reasons why South Africa docs not have a self-assessment system The Department of Inland Revenue gives the following two reasons for the delay: The material number of discretions contained in the Income Tax Act; and The current computer system will have to be upgraded to handle a self-assessment system. A system that will be able to handle self-assessment will cost approximately R 16 million. It is true that discretions are a problem in a self-assessment environment, because of the uncertainty they create when the taxpayer do not know how the Commissioner will apply the discretion. This problem need not be overwhelming, as all the other countries under self assessment have discretions in their income tax acts. Discretions can never be removed completely. Other have to be found to create certainty, for example practice notes and binding directives. Several discretions have already been removed from the Income Tax Actwith the 1991/1992 and 1992/1993 budgets. By managing the remaining discretions effectively, self-assessment can be a very real possibility. There are several other problems in the way of implementing a self-assessment system, which might prove more difficult to overcome than discretions. Some of these are: • The high illiteracy rate; • A material percentage of the populations are living below the bread line and every available cent is spent on reconstruction and development; • It is only human to expect that there will be a resistance against change • The high cost of compliance. Research in Australia has shown that the cost of compliance for the taxpayer did not decrease and it might even have. increased (pope and Fayle,1991:44)

One way for employers to attract and retain the services of employees who are in a position to make a material contribution to the successful operation of the employer is to offer such selected employees the opportunity to participate in an employee share incentive scheme in terms of which they will receive certain benefits. Generally, a benefit derived from the participation in an employee share scheme is taxable as employment income where the granting of such benefit is linked to the employee’s employment or in respect of services rendered by that employee to his employer. Countries often have a different basis for the taxation of benefits derived from participation in an employee share incentive scheme. In South Africa, the benefits from the participation in an employee share incentive scheme are taxed at the time such benefit vests (i.e when the employee becomes unconditionally entitled thereto). However, in Belgium, the benefits are taxed upfront at the time it is granted. While in India, the benefits are only taxed at the time of transfer or allotment (exercise). Where employees receive employee share incentive scheme benefits in respect of services rendered in more than one country, double taxation could occur as a result of each country taxing the benefits a different manner. If two or more countries seek tax the benefit or a portion thereof they often follow different approaches to the allocation, timing and characterisation of income derived from participation in an employee share incentive scheme. This could result in the measures which aim to prevent double taxation, in DTA’s as well as the South African domestic legislation, being ineffective. This study compares the tax treatment of benefits derived from the participation in an employee share scheme in South Africa, Belgium and India which each follow a different approach to the taxation of benefits derived from the participation in an employee share scheme. It aims to illustrate the possibility of double taxation from a South African resident perspective where DTAs and the South African legislation are not effective in eliminating double taxation. / Dissertation (LLM)--University of Pretoria, 2014. / lmchunu2014 / Mercantile Law / unrestricted

M.Comm. / The for-profit business must maximise owners' wealth over the long term. It is accomplished by legally structuring the lease to minimise tax liability. Accounting profits and tax liability arising from the lease are determined in different ways: different lease structures could result in similar accounting profits, but different tax liability. A lease's accounting profits may be preestimated with relative certainty, but it's difficult to pre-estimate its tax liability. It's especially difficult with long-term leases that stretch over a number of accounting periods and tax years. There isn't a specific framework with which tax liability arising from the lease of immovable property may be determined and minimised. This study focuses on determining and minimising income tax liability within the context of the leasing of immovable property in South Africa. The workings of the factors that give rise to the tax liability are distinguished. Different types oflease agreements, reflecting the commercial objectives, are identified. A framework is then constructed from these factors to simplizy determination of the tax liability, and to structure the lease so that tax liability may be reduced. The different types of lease agreements are imposed on the framework to subordinate the reduction of tax liability to the parties' commercial objectives.

M. Comm. / It is becoming extremely difficult to ignore the Internet. Globally people are using the Internet to initiate a variety of transactions. These transactions range from the buying and selling of physical goods to the buying and selling of services. Internet traffic is increasing daily and this suggests that electronic commerce revenues will grow at an alarming rate. Electronic commerce has exploded world-wide, and South Africa is no exception. Internet based business-to-business transactions are growing and are expected to become a major market factor. The continuous development and growth of the Internet is attracting business to bring their goods and services to a global marketplace. Public and private international communication systems open up opportunities for new forms of commercial activities. Electronic commerce has developed rapidly because companies have seen the way in which computerisation, and in particular the Internet, can accelerate business procedures. The Internet is allowing traditional businesses to expand the geographic boundaries in which their products are marketed and is also generating new businesses and ways of doing business. This results in new electronic products and delivery mediums. In a rapidly growing marketplace, national borders are becoming meaningless to the distribution or sale of a company's product or service. These changes in business provide a challenge to tax legislators and advisors. It is no longer easy in many instances to determine whether a company is providing products, the use of intangibles, or services. The development of these new products and services poses a host of issues when applying current taxation laws designed to deal with traditional businesses manufacturing physical goods.

The lack of specific tax legislation and practice dealing with the taxation of derivatives in South Africa necessitates the construction of a framework for the taxation of derivatives: the subject of this dissertation. The lack of sophistication within the Income Tax Act, No. 58 of 1962 and the lack of clarity provided by the South African Revenue Service with regard to derivatives, specifically in a hedging context, is expected to be overcome to a large degree by virtue of the contents of this dissertation. The dissertation considers the meaning of a derivative and a hedge in a tax context and culminates in the drafting of suggested definitions of a derivative and a hedge to be housed within our tax legislation. The definitions have been constructed from key themes and features extracted from various comparative studies. Given the changes in accounting methodologies and practice of derivative transactions, it is considered that the need, from a tax perspective, is to move closer to the accounting treatment of gains and losses on derivative transactions. The analysis in this dissertation favours this approach in the instance specifically where derivatives are transacted as a hedge of an underlying capital transaction. The purposes for which derivatives are used are finally considered specifically in the context of the common law doctrine of substance over form. The subjective test of the taxpayer’s mindset plays a major part in balancing the legal form of a transaction and its legal substance. It is hoped that a fresh view on the taxation of derivatives and the construction of this framework provides users of tax legislation with a concise pathway to the tax effect and consequences of their application. / Prof. D Coetsee

South Africa has a residence based system of taxation in which South African tax residents are taxed on their worldwide income. A company or other artificial person is regarded as a South African resident for tax purposes if it is incorporated, established or formed in South Africa or if its ‗effective management‘ is located in South Africa. Where a tax treaty determines in terms of its tie breaker rule that an artificial person is not resident in South Africa for treaty purposes, the company will also not be regarded as a tax resident in terms of South African domestic law. Treaties to which South Africa is party will often use the effective management‘ as the tie-breaker where a person other than an individual is resident in both Contracting states in terms of the respective states‘ domestic laws. The tests of ‗incorporation, established and formed‘ provide simplicity and certainty to governments but are easily open to manipulation by taxpayers. Therefore, the legislature found it necessary to incorporate effective management‘ as a test for residency into the Act. Effective management‘ is a substance over form concept which be described as a function which embodies the periodic, most senior executive management functions, which are required for the management of the affairs of the entity as whole. The test of effective management‘ by its very nature is concerned with where the crucial decisions are made in order to make a business function. To identify the location of effective management‘ it is necessary to enquire who calls the shots‘ in the context of the management of the company as opposed to who controls the company notwithstanding that there may in certain instances be overlap between the two functions. It is submitted that any person who, on the face of it seems unconnected to a company, could effectively manage‘ a company if that person is, in substance, responsible for the most senior executive management functions of the company. The discussion paper issued by SARS recognises the principal difficulties experienced with its current interpretation of the concept and makes valuable points, concessions and recommendations. It also recognised that the 'calling of shots' by the most senior executive is a critical marker of effective management‘ and that control of a company is irrelevant in determining effective management‘. To determine who effectively manages‘ a company each situation would have to be analysed on its own as it is not possible to create a definitive rule on the concept. In many cases the nature of the entity and its modus operandi would have to be taken into account to determine effective management.

The aim of the treatise was to provide a clear understanding of the changes to the trading stock provisions in the Income Tax Act. Various sections of the Act were covered and case law was reviewed with relevance in relation to this research project in order to gain a deeper understanding of the development of the trading stock provisions, thus bringing together the tax legislation and the case law principles. Emphasis was placed on the development of the trading stock provisions. The conclusion from this was that some of the amendments were merely textual in nature whilst others were driven by case law. There were instances where cases did not give rise to amendments but simply reinforced existing provisions by providing guidance and clarity by way of the judges’ interpretations of those provisions. The amendments relating to the trading stock provisions in the Act and the judges’ interpretation of the applicable case law have resulted in a comprehensive understanding of the treatment of trading stock.