The income tax consequences that flow from the assumption of contingent liabilities as part of the sale of a going concern is a contentious matter that continues to frustrate sellers and purchasers. The challenges faced by sellers and purchasers include inherent mismatches between the objects of accounting practice and that of income tax legislation; inconsistent policy formulation by National Treasury (Treasury) and the South African Revenue Service (SARS), and income tax legislation and case law that do not adequately recognise the economic effect of these transactions for sellers and purchasers. These, and other, challenges are highlighted and unpacked in this study by evaluating accounting standards, the Income Tax Act 58 of 1962 (ITA), case law and publications by SARS. In recent years there have been increasing calls for Treasury and Parliament to intervene by means of legislative reforms and for SARS to issue guidelines, in order to provide clarity regarding the income tax consequences for sellers and purchasers. New provisions and amendments to the ITA were proposed in the Draft Taxation Laws Amendment Bill of 2011 (draft Bill). The proposed legislative reforms were however withdrawn before the Taxation Laws Amendment Bill of 2011 was introduced in Parliament. Interpretation Note 94: Contingent Liabilities Assumed in the Acquisition of a Going Concern (IN94) was published by SARS during the latter part of 2016, with the aim of setting out principles which can serve as an interpretative guide for the determination of the income tax consequences for sellers and purchasers. This study investigates whether IN94 adequately addresses the challenges highlighted in this dissertation. The Davis Tax Committee, in its Report on the Efficiency of South Africa's Corporate Income Tax System, states that while SARS has attempted to address some of the shortcomings in respect of the taxation of contingent liabilities through interpretation notes and rulings, this is unsatisfactory as it is the legislation which requires amendment in order to address the shortcomings. In the final part of this study, the legislative reforms proposed in the draft Bill iv are evaluated, and the case is made for the reconsideration of comprehensive legislative reforms in order to create more certainty for sellers and purchasers.

Includes bibliographical references (leaves 189-202). / I evaluate the efficiency and effectiveness of the South African tax system in terms of revenue collection, exploitation of statutory tax bases and the achievement of fiscal policy goals. The evaluation is undertaken via the development of qualitative and quantitative testing frameworks, based on the collation of international experience and the adaptation of existing methodologies to the domestic context.

This paper aims to critically evaluate whether the existing VAT consequences on medical care services (and goods) is still relevant and valid given the developments within the South African economy since 1991, when VAT was first introduced in South Africa. Furthermore, this paper seeks to identify alternative VAT consequences that could be utilised if it is considered that the existing VAT consequences on medical care services and goods are no longer relevant and valid. Medical services and goods currently receive no concessional VAT treatment. This is because, when VAT was first implemented in 1991, patients of lower- and middle-income classes used the State medical systems and hence only paid nominal VAT or no VAT on their medical services. Therefore, VAT did not significantly impact them. Furthermore, services which had higher input costs would be negatively affected by exempting these services from VAT. However, the private healthcare system has increased significantly since the adoption of VAT in 1991. In today's economy, the private sector accounts for over 50% of healthcare spending in South Africa (Department of Health, 2017:42). The majority of this, however, is funded via medical aid, and only 14% of this expenditure is recorded as occurring from out-of-pocket plans (RH Bophelo , 2017). Therefore, the Value-Added Tax Committee's (“VATCOM's”) reasoning for not zero-rating VAT on medical care services and goods in 1991, was because it only impacted a nominal amount of the economy as a result of people using the State's healthcare system and, hence, only having to pay nominal VAT. It needs to be questioned if this is still relevant and valid in today's more robust South African economy. This is as a result of the ever-increasing portion of the economy who are either required to pay for private medical services, are not covered by medical aid, or need to add on an additional 15% (National Treasury, 2018:11) on top of the already expensive cost of these services due to the standard-rating of VAT for these supplies in South Africa. When South Africa first implemented its VAT Act it was based on the New Zealand model for General Sales Tax (Lang, et al., 2009: 264). Under the New Zealand GST model, healthcare services were standard-rated (New Zealand Government, 1985), hence providing reason as to why South Africa standard-rated medical services. However, Australia, who adopted GST in 2000, implemented healthcare as a GST free (zero-rated VAT) supply (Office of Parliamentary Counsel, 1999:98). Further to this, the United Arab Emirates, which is one of the most recent countries to introduce the VAT system into their economy, in 2018 (Deloitte, 2017:4), healthcare services from VAT (President of the United Arab Emirates, 2017:20). Additionally, the increased number of private healthcare institutions and the reliance on private medical care providers in South Africa (not to mention the fact that there is no concessional treatment, even though this healthcare system not only positively benefits patients receiving the healthcare and the South African Healthcare system, but also the South African economy as a whole) brings into question the validity and relevance of the current treatment of VAT on medical goods and services. When the current consequences of the legislation do not fully fulfil the intentions of the Vat Act, the legislation needs to be reconsidered and the tax consequences thereof re-evaluated. The preferred alternative VAT treatment recommended is for medical services and supplies, as well as medical insurance, to be zero-rated. This will allow for a reduced cost of providing these goods and service. Furthermore, zero-rating will alleviate the competitive disadvantage that private medical care suppliers are placed under as result of the substantial government presence in the public healthcare system. Additionally, it will decrease the burden of VAT being added to charges for medical services and goods, as well as decreasing the burden of VAT on medical insurance that is non-recoverable. An alternative VAT treatment (should the zero-rated approach fail) would be to exempt the supply of medical care services and goods, or to tax the supply thereof at a reduced rate. However, the high input cost being “trapped” if it were VAT exempt (in addition to the high administration complexity under a reduced VAT rate system) results in standard-rating of supplies being recommended ahead of these other concessional VAT treatments.

Includes bibliographical references. / This research will introduce the concept of debt forgiveness and highlight vanous definitions and legal concepts such as prescription, compromise, and other forms of debt relinquishments.

The objective of the dissertation is to investigate the opportunity to apply taxation incentives to promote land conservation in South Africa. This dissertation was conducted by means of a critical analysis of current legislation and data available in search of a suggested solution to finding appropriate tax incentives to encourage land conservation. In order to limit the scope of the research, a number of assumptions were made. Conflicting viewpoints underlying certain of these assumptions are discussed.

Inludes bibliographical references. / The word "royalty" is used in South Africa's Income Tax Act No. 58 of 1962 ("TA") at various points. Although there is a general understanding on the meaning of a royalty, there is no official definition for this term which can be used throughout the ITA. Section 35 of the ITA provides the strongest guidance of what a royalty is. However, this section applies to royalties and similar payments.

In recent decades, the rise of the digital economy has drastically changed the way the world does business. Business can now be conducted without regard to geographical boundaries and limitations and organisations have the ability to conduct business making use of mobile and sophisticated software in South Africa without having a significant physical presence in the country. In addition, the characterisation of income from new software-related arrangements may be difficult to determine in this new economy. In response to the above, there is a general move globally to align taxation with economic substance and value creation and there is an increased focus on source-based taxation. Consequently, this dissertation conducts an analysis of the relevance and appropriateness of South Africa's source rules pertaining to software arrangements as contained in section 9 of the Income Tax Act (ITA) and as espoused in the common law. It is submitted that there are four main income characterisations applicable to software arrangements (sales, service arrangements, leases and royalties arrangements) and that it is possible to apportion a software-related payment into these various components for tax purposes. It is only once this characterisation has been completed that the source rules applicable to the various components should be applied. In relation to this, it is submitted that with the exception of show-how as espoused in section 49A of the ITA, the concepts of a royalty and know-how are consistent in the OECD Model Tax Convention and the ITA. Specifically, in determining if a software payment constitutes a royalty, a distinction should be made between the copyrighted article and the copyright itself, unless the component of the payment attributable to one of the items is clearly insignificant. Only the component of the payment attributable to the use of a copyright would constitute a royalty for South African tax purposes.

This dissertation explores the penalty regime provided for in the Tax Administration Act, No 28 of 2011 (‘the Admin Act’), and implementation thereof in certain circumstances and behaviour on the part of the taxpayer. Even though the Admin Act has been in force for some years already, it remains necessary and relevant to explore the penalty regime that is operative to understand and confirm the scope and application thereof in various circumstances. As one discusses the different types of penalties chargeable in terms of the Admin Act it becomes evident how sternly it can be applied. Furthermore, the dissertation investigates how burdensome the regime can be and what remittance regime is available to taxpayers if they are penalised. This dissertation attempts to define what the objects of the Admin Act’s penalty regime are, and to determine whether these objectives are being achieved with the application of the penalty regime that is currently operative in the Admin Act. It also considers whether the identified objects of the Admin Act’s penalty regime accord with the doctrine of punishment. It is imperative that legislation is aligned with the objective of the penalty regime as misalignment will prejudice taxpayers, whilst potentially derogating from the purpose that the legislation seeks to achieve. In this dissertation, the crux of the penalty regime is investigated and highlighted. It also endeavours to assess the powers entrenched in the Admin Act and the need for clarification on a few uncertainties. The findings of this research study have revealed that: • The enactment of the penal provisions in the Admin Act only partially achieves the philosophy of the doctrine of punishment and, • In instances where the penal provisions do achieve the objects of punishment, it appears that the application thereof is not consistently applied in practice. The penal levying system in the Admin Act has been an improvement on the past penalty provisions as is evident in Chapter 3. However, despite the more favourable and fair outcome achieved by the penal provisions in the Admin Act, the research concludes that more specific guidance and measures in respect of the application of the penal provisions are necessary. The behaviours listed in the understatement penalty percentage table are not defined and creates the need for further improvement. Though changes have been made since the implementation thereof it still requires further revisions. In respect of inconsistent application of the penal provisions in practice it is recommended that the administrators of the legislation be better equipped in respect of the application of the penal provisions or that the processes should be changed to address the misalignment of the application of the penal provisions.

Includes abstract. / Includes bibliographical references. / The focus of this research paper is to discuss the underlying principles of Islamic finance and its tax implications for investors and financial institutions. The nature of Islamic financial products is compared to its conventional financial counterpart to identify whether differences exist between Islamic and conventional finance from a tax perspective. The proposed changes to the South African Income Tax Act No. 58 of 1962 relating to Islamic finance contain deeming provisions to provide tax neutrality between Islamic and conventional finance. It appears that certain international tax issues for Islamic finance have not yet been addressed by the proposed changes and will have to be considered for the tax neutrality to be achieved.

Includes bibliographical references. / In this dissertation, the author focuses on the practical tax issues relating to the recently adopted South African Real Estate Investment Trust tax dispensation, by discussing international principles of Real Estate Investment Trust taxation and two foreign regimes, i.e. the US and UK Real Estate Investment Trust regimes which, it is understood, were used as a basis for the South African legislation. In addition, the dissertation discusses the details of the South African property investment vehicles regime pre- 1 April 2013, and the new Real Estate Investment Trust tax regime applicable from 1 April 2013. Furthermore, it looks at suggestions and possible improvement to the taxation of Real Estate Investment Trusts in South Africa and whether the proposed amendments released by National Treasury, on 4 July 2013, satisfactorily address the issues raised in this dissertation.