SARS Dividends Exemption 2014 (Local and Foreign Dividends)

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<h2>The South African Revenue Service Dividends Exemption for 2014</h2>

 

Dividends Taxation in South Africa - Local Dividends

 

Dividends tax is imposed at 15% from 1 April 2012 on dividends declared and paid by resident companies and by non-resident companies in respect of shares listed on the JSE. Dividends are tax exempt if the beneficial owner of the dividend is a South African company, retirement fund or other exempt person. The tax is to be withheld by companies paying the taxable dividends or by regulated intermediaries in the case of dividends on listed shares. When a taxpayer receives South African dividends, the income is exempt from normal tax;

    • If an individual receives foreign dividends from a foreign company (with shareholding of less than 10% in the foreign company) the dividend is taxable at a maximum effective rate of 15%;
    • These were previously taxed at the maximum marginal rate;
    • Taxpayers are not allowed any deductions for expenditure to produce the foreign dividend;
    • The tax is subject to double tax treaty relief;
    • Exemptions apply for domestic retirement funds, Public Benefit Organizations and domestic companies;
    • The company paying in specie dividends, will be liable for payment of DWT;
    • Loans to shareholders at less than the official interest rate will attract DWT; and
    • STC credits from the old regime may be utilized until 31 March 2015.

       

If you have any questions relating to interest exemptions please contact us on 011 447 8823 Today to speak to a consultant for FREE.

 

Dividends Taxation in South Africa - Foreign Dividends

 

Most foreign dividends received by individuals from foreign companies (shareholding of less than 10% in the foreign company) are taxable at a maximum effective rate of 15%. No deductions are allowed for expenditure to produce foreign dividends.

 

If you have any questions relating to interest exemptions please contact us on 011 447 8823 Today to speak to a consultant for FREE.