Welcoming Tax news for franchise owners

The Tax Court has upheld a decision that a tax deduction allowed by section 24C of the Income Tax Act may be applied to franchisee costs. Section 24C permits the deduction of certain expenses in the current tax year assessment, where those expenses are not yet incurred, on the basis that these expenses will contractually be incurred in future years. […]

Tax implications of international branches

Irrespective of whether a South African company is expanding its business offshore, or whether international businesses set up shop in South Africa, companies trading internationally are often confronted with the complex tax implications for doing so. This article explores the tax implications linked to international branches of a company specifically; it does not consider the scenario where a corporate group […]

Misuse of assessed losses

An assessed loss for income tax purposes is a potentially valuable asset:  it represents past losses made by a taxpayer which is able of being carried forward to subsequent tax years against which future taxable profits are able of being set off.  The set-off of historic losses – in the form of an assessed loss – against existing taxable income […]

The general anti-avoidance rules

The Income Tax Act, 58 of 1962 (‘Income Tax Act’) contains various specific anti-avoidance rules aimed at preventing the abuse of certain specific sections in the Income Tax Act. However, over and above these specific anti-abuse provisions, the general anti-avoidance rules (‘the GAAR’) would also find application to cover further potential and unforeseen loopholes, or abuse of beneficial tax regimes, […]