Page 269 - SAIT Compendium 2016 Volume2

IN 18 (3)
Income Tax acT: InTeRPReTaTIon noTes IN 18 (3)
4.5.1 Application of paragraph (i) of the proviso to section 6quat(1B)(a) to deductions in respect of retirement annuity fund contributions and donations to certain organisations
4.5.2 Deductibility of foreign taxes against income in determining taxable income
4.5.3 The treatment of foreign taxes payable in respect of exempt foreign dividends in the limitation formula Application of section 6quat to capital gains
4.6.1 General
4.6.2 Inclusion of a foreign-source taxable capital gain in taxable income
4.6.3 Source of a capital gain
4.6.4 The three-step limitation process
Application of section 6quat to the attributed income of a CFC
4.7.1 General
4.7.2 The three-step CFC limitation process
The carry-forward of a balance of excess foreign taxes
Interaction between tax treaty credit method and section 6quat(1) rebate method
4.9.1 Tax treaty methods for providing relief from double taxation
4.9.2 General principles that apply to interactions between domestic legislation and tax treaties
4.9.3 Choice between tax treaty credit method and section 6quat(1) rebate method
4.9.4 The tax credit method – effect of wording of relevant articles
4.9.5 The tax credit method – articles that are not ‘subject to’ section 6quat
4.9.6 The tax credit method – articles that are ‘subject’ to section 6quat
4.9.7 Application of the tax treaty credit method and section 6quat rebate method in the same year of assessment 4.9.8 Meaning of ‘income’ in the article of a tax treaty dealing with the elimination of double taxation
4.9.9 Payment of foreign tax under the tax treaty credit method
4.6
4.7
4.8 4.9
4.10 Recalculation of the section 6quat(1) rebate under section 6quat(5)
5 The deduction of foreign taxes on income under section 6quat(1C)
6 Section 6quat(1) and section 6quat(1C) – general matters
6.1 The translation of foreign taxes to rand [section 6quat(4)]
6.2 Rounding off to nearest R1 [section 6quat(4A)]
6.3 Application of section 66(13A) to section 6quat
6.4 Calculation of provisional tax payments with reference to foreign tax liabilities
7 Section 6quin – Rebate for foreign taxes on South African-source service income 7.1 Background
7.2 Rebate for foreign taxes on South African-source service income [section 6quin(1)] 7.2.1 Meaning of the term ‘source’ for purposes of section 6quin(1)
7.2.2 Meaning of the term ‘services’ for purposes of section 6quin
7.3 Amount of the section 6quin rebate
7.3.1 Calculation of the section 6quin rebate – per service contract
(a) The amount of foreign tax levied and withheld or imposed, as appropriate, by a foreign government under section 6quin(1)
(b) The amount of normal income tax attributable to the amount of South African-source service income
7.4 Timing of the section 6quin rebate
7.5 No section 6quin rebate for foreign taxes claimed as a rebate under section 6quat(1) or a deduction under section 6quat(1C) [section 6quin(3)]
7.5.1 Interaction between sections 6quat(1) and 6quin
7.5.2 Interaction between sections 6quat(1C) and 6quin
7.6 Reporting requirements under section 6quin [section 6quin(3A)]
7.7 Translation of foreign taxes to rand [section 6quin(4)]
7.8 Foreign taxes refunded or foreign tax liabilities discharged deemed to be normal tax payable in year of refund
or discharge [section 6quin(5)]
7.9 Calculation of provisional tax payments with reference to the section 6quin rebate
8 Rebate in respect of foreign taxes on dividends [section 64N]
8.1 Rebate for foreign taxes on dividends paid by a foreign company [section 64N(1)] 8.2 Amount of rebate for foreign taxes on dividends [section 64N(2)]
8.3 Limitation on amount of rebate for foreign taxes on dividends [section 64N(3)] 8.4 Translation of amounts of foreign taxes on dividends [section 64N(4)]
8.5 Proof of foreign taxes on dividends {section 64N(5)]
9 Documentary proof required by SARS in respect of foreign taxes
9.1 Basic information required
9.2 Additional information required when the foreign tax has been withheld at source
9.3 Additional information required when the foreign tax has not been withheld at source and the foreign tax
jurisdiction operates a system of self-assessment of income tax
9.4 Additional information required when the foreign tax has not been withheld at source and the foreign tax
jurisdiction operates a system of assessment similar to South Africa 9.5 Evidence required for dividends tax
9.6 Translation of information worded in a foreign language
Annexure A – Comprehensive three-step limitation example including foreign branch operations, foreign dividend income and income attributable to a CFC
Annexure B – Additional examples in respect of natural persons Annexure C – The law
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