S.Africa – SARS Share Owners Tax Guide

SARS 2018 Tax Guide for Share Owners

Revenue Service issues tax guide for share owners
On 5 November 2018, the South African Revenue Service (SARS) published the Tax Guide for Share Owners (Issue 6). The Guide summarizes the key aspects that holders of shares need to be aware of in computing their liability for income tax and capital gains tax. The Guide is primarily aimed at resident individuals who own shares in their own names.
The Guide is based on tax legislation as at 18 December 2017 and focuses on the 2018 year of assessment although much of the commentary will also apply to earlier years of assessment.
Specifically, the Guide deals with the following:
the tax consequences of holding shares as trading stock compared to holding them as capital assets;
how to distinguish between profits of capital and revenue 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 persons’ liability for tax.
The guide provides general guidance only. It is not an official publication and, therefore, will not be a source to establish a binding practice generally prevailing under section 5 of the Tax Administration Act 28 of 2011.
Comments on the guide may be sent to policycomments@sars.gov.za