fbpx
How does your marriage contract affect your tax return?

How does your marriage contract affect your tax return?

HOW DOES YOUR MARRIAGE CONTRACT AFFECT YOUR TAX RETURN?

ICOP – In Community of Property

  • Interest – Jointly held bank account
  • Spouse A: 50% of Interest
  • Spouse B: 50% of Interest

 

  • Foreign Dividend paid to spouse A
  • Spouse A: 50% of Dividend Income
  • Spouse B: 50% of Dividend Income

 

  • Rental Income
  • Spouse A: 50% of income and expense
  • Spouse B: 50% of income and expense

 

OCOP – Out of Community of Property

  • Interest paid to Spouse B
  • Spouse A: Nil
  • Spouse B: Will be taxed in the hands of the owner of the investment at 100%

 

  • Foreign Dividend paid to Spouse A
  • Spouse A: Will be taxed in the hands of the owner of the investment at 100%
  • Spouse B: Nil

 

  • Rental income; owned by spouse B
  • Spouse A: Nil
  • Spouse B: 100% Rental income and expenses

 

  • Rental income; each spouse owns 50%
  • Spouse A: 50% of rental income and expenses
  • Spouse B: 50% of rental income and expenses

source: Tax Talk issue 70

 

No Tax Number – No Job

No Tax Number – No Job

 

So lately I have come across a lot of employers who are asking for employees tax numbers before they are considered for a position.

This issue has actually been addressed with SARS and they have stated the following ” While SARS will readily assist persons who approach our branches to register, such processes are placing an unnecessary burden on both the prospective employees and on SARS branches”.

SARS goes on to state that they don’t require a person to have a tax number prior to being employed for the first time.

SARS has made it very easy for employers to register their employees for tax by various means;
– Registering them on Easyfile
– New applications on SARS Efiling
– Bulk registrations on Easyfile

Source; TaxTalk issue 71

 

Provisional Tax

Provisional Tax

Today’s Topic is Provisional Tax

I will explain what it is how it works and when its due

Provisional tax is broken down into 2 returns (there is a 3rd option that is also available).  

What SARS asks is that we guesstimate what our taxable income will be by the time year-end comes, then what we do is split this up into 2 periods (August being the first) and (February being the second) 

It is very important to note that provisional tax is not a separate tax from your income tax, it’s simply a provision for your income tax  😊 it also helps taxpayers settle their tax liability over time and not have to come up with funds all at once.

If you have overstated on your provisional tax eg: I had to pay in R 10 000 of tax but when I lodged my tax return I was only due to pay R5000 SARS will refund you the difference. I always believe its better to overestimate than underestimate or you will face penalties.  

So, who needs to pay provisional tax?

  • Any person who receives income other than remuneration or allowance from an Employer who is not registered for Employees Tax
  • Any Company
  • A person who has been notified by SARS that they must become a provisional taxpayer.

Your first period is August, so this will be referred to as the 201901 IRP6 Return and your second is in February and this is referred to as the 201902 IRP6 Return. The first return is due by the end of August and the February one is due by the end of February 😊

 

If you found this helpful let me know in the comments below 😊