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Comparable Tax Exemption (Section 9D(2A))
- 23 March 2020
- Corporate Tax
- The Tax Faculty
Important:
This amendment becomes effective on 1 January 2020 and is applicable to years of assessment ending on or after that date.
Where a non-resident company meets the requirements of a Controlled Foreign Company (“CFC”), section 9D(2A) determines that the taxable income of the foreign company must be imputed (included) in the taxable income of residents holding interests in the CFC. The CFC rules contain an exemption known as a comparable tax exemption: The net income of a CFC shall be deemed to be nil where the taxes payable on income by the CFC to foreign governments was at least 75% of the South African tax the CFC would have paid had it been a South African resident company.
The amendment determines that the comparable tax exemption threshold be reduced to 67.5%.
Webinar Commentary
Access commentary and an in-depth technical summary on the Webinar On Demand presented by Prof Jackie Arendse here: https://lnkd.in/gvZF_mQ