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Tax Guide for Share Owners (Issue 8)
- 19 October 2022
- Tax Administration
- SARS
This guide provides general guidance on the taxation of share owners. It does not go into the precise technical and legal detail that is often associated with tax, and should not, therefore, be used as a legal reference. It is not an “official publication” as defined in section 1 of the Tax Administration Act 28 of 2011 and accordingly does not create a practice generally prevailing under section 5 of that Act. It is also not a binding general ruling under section 89 of Chapter 7 of the Tax Administration Act. Should an advance tax ruling be required, visit the SARS website for details of the application procedure.
The guide examines –
- the tax consequences of holding shares as trading stock compared to holding them as capital assets;
- how to distinguish between profits of a capital and revenue nature using common law principles and statutory rules;
- the determination of a taxpayer’s liability for capital gains tax;
- how dividends are taxed; and
- various corporate actions that can impact on the determination of a person’s liability for tax.
This guide is based on legislation as at 19 January 2022 and primarily focuses on the 2022 year of assessment although much of the commentary will also apply to earlier years of assessment.
Click here to read the full guide.
Source: SARS