Thesis (MBA)--Stellenbosch University, 2006. / ENGLISH ABSTRACT: Governments do not want their tax collection to be affected by multinational
companies that make use of distorted pricing models in order to maximize profits. For
this reason Governments everywhere are implementing strict transfer pricing policies.
These policies are mainly based on the OECD Guidelines with respect to transfer
pricing. On the other hand, multinational companies do not want to be exposed to
double taxation.
The South African government also introduced regulations with respect to transfer
prices set by multinational companies. Section 31 of the Income Tax Act 58, 1962,
deals specifically with the issue of transfer pricing. This is fully explained in Practice
Note 7 of SARS.
RHI Refractories Africa, as part of the multinational company RHI-Ag, has to comply
with SARS legislation. RHI Refractories Africa purchase many materials and products
from the parent company for resale in the local market. The SEN is one such product
and was selected for evaluation. This study found, after evaluation of the functions
performed by RHI Refractories Africa and evaluating all the various preferred
methods, the Resale Price Method (RPM) to be the most appropriate method to be
used in the evaluation of the status of RHI Refractories Africa with respect to
compliance with current SARS legislation.
The gross margins eamed by RHI Refractories Africa on the sale of TYK and THOR
SENs were compared. It was found that the gross margins earned on the sale of
THOR SENs in the controlled transaction were actually higher than those earned in
the uncontrolled transaction with TYK.
The conclusion of this study is that RHI Refractories Africa does comply with current
SARS legislation as measured against the guidelines of Practice Note 7 from SARS.
This study further proposes that RHI Refractories Africa evaluate and document the
process followed for all the inter-company transactions in order to ensure full
compliance with SARS legislation. / AFRIKAANSE OPSOMMING: Regerings wil verhoed dat die belasting basis verklein word deur multinasionale
maatskappye wat gebruik maak van prys modelIe wat daarop gemik is om belasting
te ontduik en sodoende die marges van die maaskappye te verhoog. Vir die rede
implimenteer regerings strenger maatreels om te verseker dat oordrag pryse
markverwant is en bly. Die riglyne soos voorgestel deur die OECD word meestal as
basis gebruik vir die opstel van lokale wetgewing. Terselfdertyd wil multinasionale
maatskapye ook nie dubbele belasting betaal nie.
Die Suid Afrikaanse regering het wetgewing daar gestel as deeI van Seksie 31 van
die Inkomste Belasting Wet 58, 1962, wat spesifiek handel met oordrag pryse. Die
wetgewing word verder verduidelik in Praktiese Nota 7.
RHI Refractories Africa, as deeI van die multinasionale maatskapy RHI-Ag, moet
voldoen aan SARS wetgewing. RHI Refractories Africa koop 'n verskeidenheid van
materiale en produkte van die moeder-maatskapy vir herverkoop in die lokale mark.
Die SEN is een so 'n produk en is gekies vir evaluasie. Die funksies wat RHI
Refractories Afrika uitvoer ten opsigte van die verkoop van SENs is ten volle
ondersoek. Die verskillende metodes vir evaluering van die oordrag prys soos
voorgestel deur SARS is ook ondersoek en daar is gevind dat die Herverkoop Prys
Model (RPM) die mees geskikte model is vir RHI Refractories Africa om te gebruik in
die evaluering van die verkoop van SENs.
Die bruto marge wat RHI Refractories Africa behaal met die verkoop van TYK en
THOR SENs is vergelyk. Daar is gevind dat die bruto marge wat behaal is met THOR
SENs, as deel van die beheerde transaksie, in werklikheid groter is as die wat met
TYK SENs in die onbeheerde transaksie behaal is.
Die konklusie van die studie is dat RHI Refractories Africa wel voldoen aan die
vereistes daar gestel deur SARS soos gemeet aan die riglyne van Praktiese Nota 7.
Die studie stel voor dat RHI Refractories Africa al die intermaatskaplike transaksies
evalueer aan die hand van die SARS riglyne om te verseker dat daar ten volle
voldoen word aan die vereistes van SARS.
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:sun/oai:scholar.sun.ac.za:10019.1/50670 |
| Date | 12 1900 |
| Creators | Fourie, Albert Roeloff |
| Contributors | Smith, J. du P, Stellenbosch University. Faculty of Economic and Management Sciences. Graduate School of Business. |
| Publisher | Stellenbosch : Stellenbosch University |
| Source Sets | South African National ETD Portal |
| Language | en_ZA |
| Detected Language | English |
| Type | Thesis |
| Format | 64 p. : ill. |
| Rights | Stellenbosch University |
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