Individuals:
Use examples from separate hand-outs and not from Silke because it has not been updated
with the latest figures.
Introduction and framework:
Comprehensive framework for individuals [NB!! Must know off by heart]
Other
income and
deductions
Gross income- general and specific inclusions (s1)
Add: deemed inclusions (s7 and s8 (4) (a))
Less: Exempt income (s10 and 10A)
Income- subtotal 1
Less: Deductions and allowances (s11 and other
deductions except s11 (k), s11 (n), s18A and s18)
Subtotal 2
Less: Assessed losses (s20)
Subtotal 3
Less: s11 (k) (i) current PF contributions
Limited to the greater of:
R1 750 or
7.5% x RFE remuneration
Less s11 (k) (ii) arrear PF contributions –
maximum of R1 800
Subtotal 4
Less s11 (n) (i) (aa) current RAF contributions
Limited to the greatest of:
R1 750 or
R3 500 – s11 (k) (i) current PF deduction or
15% x (subtotal 3 less RFE remuneration)
Less s11 (n) (i) (bb) arrear RAF contributions –
maximum of R1 800
Subtotal 5
Plus: Taxable capital gains (s26A)
[CGT calculation]
Plus: Other inclusions in taxable income
, Subtotal 6
Less: Deductions for donations to a Public Benefit
Organisation (s18A donations) limited to 10% of
subtotal 6
Subtotal 7
Less: Medical deductions (s18)
Taxable income
Normal tax payable on taxable income by
applying the progressive rates of tax for natural
persons
Less: s6 (2) rebates (primary, secondary, tertiary)
Less: s6A rebate (medical)
Normal tax liability
Less: Employees tax payments (PAYE)
Less: Provisional tax payments
Less: Withholding tax for non-residents (s35A)
Normal tax payable (if positive) or receivable (if
negative) by the taxpayer
Why the framework?
o Assessed loss can only be set off against certain amounts
o Some receipts (i.e. severance benefits) may not influence deductions
o Taxable Capital Gain and allowances = Taxable income (and not ‘income’)
o Order of deductions are NB, for example:
s11(n) RAF deduction
s18A donation to PBO
s18 Medical deduction
o Marks for presentation of framework in exams!!
Normal tax:
Year of assessment
YOA (individual): 1 March à 28 February
YOA < 12 months
o Occurs when the TP is born, dies or is declared insolvent during YOA
o Rebates reduced pro rata (based on days):
Only primary (any natural person), secondary (65 years and older) and
tertiary rebates (75 years and older)
No apportionment for medical rebate if broken year of assessment
Do example 10.1
No reduction of rebates if
o TP started employment / emigrated / immigrated during YOA
Normal tax table
Given in exams
Use examples from separate hand-outs and not from Silke because it has not been updated
with the latest figures.
Introduction and framework:
Comprehensive framework for individuals [NB!! Must know off by heart]
Other
income and
deductions
Gross income- general and specific inclusions (s1)
Add: deemed inclusions (s7 and s8 (4) (a))
Less: Exempt income (s10 and 10A)
Income- subtotal 1
Less: Deductions and allowances (s11 and other
deductions except s11 (k), s11 (n), s18A and s18)
Subtotal 2
Less: Assessed losses (s20)
Subtotal 3
Less: s11 (k) (i) current PF contributions
Limited to the greater of:
R1 750 or
7.5% x RFE remuneration
Less s11 (k) (ii) arrear PF contributions –
maximum of R1 800
Subtotal 4
Less s11 (n) (i) (aa) current RAF contributions
Limited to the greatest of:
R1 750 or
R3 500 – s11 (k) (i) current PF deduction or
15% x (subtotal 3 less RFE remuneration)
Less s11 (n) (i) (bb) arrear RAF contributions –
maximum of R1 800
Subtotal 5
Plus: Taxable capital gains (s26A)
[CGT calculation]
Plus: Other inclusions in taxable income
, Subtotal 6
Less: Deductions for donations to a Public Benefit
Organisation (s18A donations) limited to 10% of
subtotal 6
Subtotal 7
Less: Medical deductions (s18)
Taxable income
Normal tax payable on taxable income by
applying the progressive rates of tax for natural
persons
Less: s6 (2) rebates (primary, secondary, tertiary)
Less: s6A rebate (medical)
Normal tax liability
Less: Employees tax payments (PAYE)
Less: Provisional tax payments
Less: Withholding tax for non-residents (s35A)
Normal tax payable (if positive) or receivable (if
negative) by the taxpayer
Why the framework?
o Assessed loss can only be set off against certain amounts
o Some receipts (i.e. severance benefits) may not influence deductions
o Taxable Capital Gain and allowances = Taxable income (and not ‘income’)
o Order of deductions are NB, for example:
s11(n) RAF deduction
s18A donation to PBO
s18 Medical deduction
o Marks for presentation of framework in exams!!
Normal tax:
Year of assessment
YOA (individual): 1 March à 28 February
YOA < 12 months
o Occurs when the TP is born, dies or is declared insolvent during YOA
o Rebates reduced pro rata (based on days):
Only primary (any natural person), secondary (65 years and older) and
tertiary rebates (75 years and older)
No apportionment for medical rebate if broken year of assessment
Do example 10.1
No reduction of rebates if
o TP started employment / emigrated / immigrated during YOA
Normal tax table
Given in exams
