Page 328 - SAIT Compendium 2016 Volume2

IN 18 (3) Income Tax acT: InTeRPReTaTIon noTes IN 18 (3)
9.1 Basic information required
The resident must on request provide a statement which provides the following information: • The foreign tax year during which the income was received by or accrued to the resident. • The precise name of the tax and the foreign country in which it was levied.
• The name of the law under which the tax was imposed.
• Whether the tax was levied by the national government, a state or local authority and the name of such authority.
9.2 Additional information required when the foreign tax has been withheld at source
The resident must on request provide certi ed copies of –
• a certi cate of tax withheld, issued by the person paying the resident the amount; or
• a copy of a receipt issued by the relevant revenue authority as evidence of payment of the amount of the tax (that is
that the amount withheld has been remitted).
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
The resident must on request provide certi ed copies of –
• the relevant parts of the foreign income tax return containing the calculation of taxable income and taxes due, schedule
of provisional payments and signature of resident; and
• calculations of foreign provisional tax payable.
In addition SARS may request –
• documentary proof that a foreign tax liability has been incurred, for example, a letter from the relevant foreign tax
authority or a receipt for taxes paid; and
• a certi cate from the resident’s auditor stating that the amount is payable.
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
The resident must on request provide certi ed copies of –
• the relevant notice of assessment;
• the relevant parts of the foreign income tax return showing the calculation of the taxable income and taxes due,
schedule of provisional payments and signature of the resident;
• calculations of any provisional taxes payable; and
• a copy of a statement of account issued by the relevant revenue authority requesting payment.
In addition, SARS may request further information such as –
• documentary proof that a foreign tax liability has been incurred, for example, a letter from the relevant foreign tax
authority or a receipt for taxes paid; and
• a certi cate from the resident’s auditor stating that the amount is payable.
9.5 Evidence required for dividends tax
Section 64N(5) provides as follows:
‘(5) A company or regulated intermediary must obtain proof of any tax paid to any sphere of government of any
country other than the Republic and deducted from the dividend tax payable in terms of this section, in the form and manner prescribed by the Commissioner.’
It is therefore clear that the company declaring the dividend or the regulated intermediary must obtain the proof. The ‘form and manner’ has not been prescribed by the Commissioner. The following would be acceptable:
• A certi cate from the foreign entity that withheld the foreign tax, indicating the amount of the dividend and the
amount of the foreign tax withheld; or
• A tax assessment issued by the foreign tax authority indicating the amount of foreign tax paid on the dividend.
The proof should be provided to the company or the regulated intermediary before or by the date that the dividends tax is payable to the Commissioner.
9.6 Translation of information worded in a foreign language
SARS may require a resident to appoint a sworn translator to translate any documentary evidence worded in a foreign language into English.* A certi cate prepared by the translator of cially stating that the translation is a true rendition of the original may also be requested.
Legal and Policy Division
SOUTH AFRICAN REVENUE SERVICE Date of 1st issue: 31 March 2003
Date of 2nd issue: 31 March 2009
* Under section 33(1) of the TA Act a senior SARS of cial may by notice require a person to produce a translation of information, which is not in one of the of cial languages of South Africa, in one of the of cial languages determined by the of cial within a reasonable period.
320 saIT comPendIum oF Tax LegIsLaTIon VoLume 2