This is the second in our series to help you fill in your income tax return, written by Christo Henning, media liaison officer at SA Revenue Services - it covers Income Received and/or Accrued. Remember to attach your IRP5 certificate and other suppoting documents to your tax form.
All income/benefits, in cash or otherwise, received by or accrued to you during the tax year must be declared in your income tax return, including amounts received from your employer during any temporary absence from the Republic.
If you are married IN community of property, your taxable income will, if it is earned from a business activity (excluding letting of fixed property), be regarded as your income. If you and your spouse are trading in partnership, the income will accrue to you both in the agreed profit-sharing ratio.
Income received or accrued otherwise than from a business activity (eg interest), including rental from the letting of fixed property, in respect of assets forming part of the communal estate, is deemed to accrue to you and your spouse in equal portions.
Where any spouse's income is deemed to be the income of the other spouse (eg rental), any deductions or allowances relating to that income will be allowed in the same proportion in which the income is taxed.
INVESTMENT INCOME
SECTION 2.3
If you are either married OUT OF community of property or are UNMARRIED, the total income from investments must be carried to part 2.3.1 of the return.
If you are married IN community of property, only half of the income from investments must be carried to part 2.3.1 of the return. The other half is taxable in the hands of your spouse.
An income advice in respect of all investments must be obtained from the institution where your funds are invested and attached to your return.
The first R2 000 of the total amount of all interest bearing investments (including dividends from property trusts, which are taxed as interest, and the interest content of a unit trust fund distribution which is not otherwise exempt), is exempt from tax.
The gross amounts must be declared. The exemption will be calculated and allowed by the Receiver of Revenue.
EXEMPT INVESTMENT INCOME
* The first R200 interest a person received from savings deposits held with the Corporation for Economic Development Limited;
* Dividends received or accrued from any company (including the dividend portion of a unit trust distribution) are exempt from tax.
NB: Show gross amounts of all investment income as the exemptions will be done by the Receiver of Revenue.
INCOME FROM OTHER SOURCES
SECTION 2.4.1
If you are married OUT OF community of property or are UNMARRIED, the total profit/loss from rental must be carried over to part 2.4.1. of the return.
If you are married IN community of property, only half of the profit/loss must be carried over to part 2.4.1 of the return. The other half is taxable in the hands of your spouse.
Annuities from retirement annuity funds must be shown in part 2.4.2.
Annuities from ex-employers, insurance policies, trusts, estates and purchased annuities must be declared in part 2.4.3. The capital content of a purchased annuity is exempt from tax. A certificate from the insurance company, reflecting the capital content, must be attached. Other receipts and accruals ie executor's, curator's or similar fees, royalties, honoraria and any payment, accrual or receipt, from whatever source, must be declared in part 2.4.4.
Lumpsum benefits from pension, provident and retirement annuity funds must be declared in part 2.4.5. If tax was deducted, the IRP 5 certificate must be attached to your return. The circumstances under which all such awards were made must be set out in detail and the amount must be shown separately from other remuneration.
Any amount received from your employer in the form of a gratuity, including amounts received as result of the termination of your services, must be declared in part 2.4.6.
Income received by or accrued to a mineworker, over and above his normal remuneration and allowances, as a member of a proto-team for performing any hazardous task during an emergency in a mine, must be declared in part 2.4.7. The Receiver of Revenue will determine the reduced rate in these cases.