Tag: Tax Consulting SA

South Africans planning to relocate abroad or formalise their non-resident taxpayer status face a significantly changed regulatory environment. Over the past few years, the process of ceasing tax residency has shifted from a largely bank-driven exercise to a compliance-focused process under the South African Revenue Service (SARS).

The vision of “A Smart Modern South African Revenue Service (SARS) with unquestionable integrity admired by all” is a profound set of words shared by Dr Johnstone Makhubu, SARS Commissioner, at the 13th Annual Tax Indaba. Beyond words, SARS’ actions have more than echoed this sentiment. They have made it clear to the world that political power, fame and money cannot keep non-compliant taxpayers off SARS’ radar.

On 8 September 2026, the South African Revenue Service (SARS) published its 2026 Trust Income Tax Season updates. The updates introduce third-party reporting data to pre-populate information on trusts’ tax returns. This stands out as one of the most significant developments for trust tax compliance.

On 7 September 2026, the Supreme Court of Appeal (SCA) handed down a significant judgment against the South African Revenue Service (SARS). The judgment confirmed that certain financing fees qualify for tax deductions under section 24J of the Income Tax Act, 58 of 1962.

On 26 June 2026, the Western Cape High Court, in Commissioner for the South African Revenue Service (SARS) vs Meiring Citrus (Pty) Ltd, upheld SARS's appeal. The court held that a R10 million self-insurance deduction was not allowable. What began with a R10 million tax deduction claimed in Meiring Citrus' 2017 year of assessment ultimately resulted in years of verifications.

On 23 June 2026, the Constitutional Court delivered a unanimous judgment in Lueven Metals (Pty) Ltd vs Commissioner for the South African Revenue Service (SARS). The court confirmed that the zero-rating of gold under section 11(1)(f) of the Value Added Tax Act No. 89 of 1991 (VAT Act) does not apply to second-hand or recycled gold that has already undergone prior manufacturing.

Can a business claim a tax deduction for money it pays as a bribe or kickback? Under section 23(o) of the Income Tax Act, the answer is no. Kickbacks are not tax deductible. The provision was introduced in 2005 to support South Africa’s anti-corruption efforts. It denies a tax deduction for any payment that amounts to corrupt activity under our main anti-corruption statute, the Prevention and Combating of Corrupt Activities Act 12 of 2004 (the PCCAA).

More and more high-net-worth South Africans living abroad realise that the assumption that physical emigration ends their South African tax exposure is not merely incorrect. It is also becoming increasingly expensive. Many expatriates become aware of the consequences only when they receive an unexpected and substantial assessment from the South African Revenue Service (SARS). The reality is that leaving the country is not a tax strategy. South Africans continue to make what can be described as a “silent exit”.

Two recent High Court judgments, in which the powers of the South African Revenue Service (SARS) came under close scrutiny, have delivered a clear message. Despite the wide powers granted under the Tax Administration Act, No. 28 of 2011 (TAA), those powers remain discretionary. However, they are not unfettered. This marks an important instance of court scrutiny of SARS’ powers.

Time has run out for non-compliant trusts. Since 4 May 2026, the South African Revenue Service (SARS) has imposed administrative penalties on trusts with outstanding tax returns. SARS levies these penalties monthly. In some cases, penalties may reach R16,000 per outstanding return.