Thursday, February 28, 2013

Donations Tax - South Africa

Contents
  • What is donations tax?
  • What is the rate?
  • Do any exemptions apply?
  • When is a disposal considered a donation?

What is donations tax?

Donations tax is tax payable on the value of property disposed of by a resident by means of a donation.

What is the rate?

Donations tax is levied at a flat rate of 20% on the value of the property donated.

Do any exemptions apply?

Donors as individuals
In terms of section 56(2) of the Income Tax Act -  Donations tax shall not be payable in respect of so much of the sum of the values of all property disposed of under donations by a donor who is a natural person as does not during any year of assessment exceed R100 000. This came into operation from 2007/03/01 and is applicable in respect of any year of assessment commencing on or after that date.




Donors other than individuals
For juristic persons such as private companies, the exemption is limited to R10 000 in respect of casual gifts. Public companies are exempt from donations tax.






Donations to public-benefit organisations
These donations are exempt from tax.



Donations between spouses
Donations between spouses are also exempt from this tax.

Where two individuals draw up a joint will and the survivor accepts (adiates) the conditions of the joint will at the death of the first dying, the difference in value between the survivor’s property, which falls into the massed estate, and the benefit derived from that estate is regarded as a donation.
Where two people are married in community of property and property is donated by one of the spouses, that donation is deemed to have been made in equal shares if that property falls within the joint estate of the spouses.

If that property was excluded from the joint estate of the spouses, that donation is treated as having been made solely by the spouse making the donation.

When is a disposal considered a donation?

If any property has been disposed of for a consideration that, in the opinion of the Commissioner, is not an adequate consideration, that property is treated as having been disposed of by donation. The donor is liable for the payment of the donations tax. If the donor fails to pay the tax within the prescribed period, the donor and the donee are jointly and severally liable for the tax.


Source: SARS

Category: South Africa Income Tax, Donations Tax


 

Friday, February 1, 2013

Best unit trusts in SA

Coronation was honoured as the best manager of South African unit trust funds in 2012 at the annual Raging Bull Awards ceremony in Johannesburg last night.

 
Allan Gray, which until last year had won the award for top management company for four years in a row, received the certificate for second-best management company of 2012.
Nedgroup Investments, which was the runner-up last year, collected the certificate for third-best management company of 2012.
A Raging Bull is also awarded to the best offshore-domiciled management company that is permitted to market its funds to South African investors, because the funds are registered with the Financial Services Board. This year, the award went to Lloyds.
The Raging Bull Awards honour fund managers and management companies that provided superior returns for unit trust investors during the preceding year.
Personal Finance, PlexCrown Fund Ratings and ProfileData are the joint sponsors of awards, which turned 17 this year.
Don’t miss Personal Finance newspaper this Saturday for profiles of the winning companies and funds.
Here is the complete list of winners of Raging Bull Awards and certificates:
WINNERS OF RAGING BULL AWARDS
TOP MANAGEMENT COMPANIES OF 2012
The unit trust management companies with the most impressive and most consistent overall performance across their families of funds taking into account all factors (performance, risk-management and consistency).
Methodology: The award is based on the highest average PlexCrown rating for the suite of funds managed by each management company. Passive funds and funds in non-ranked sectors (for example, the varied specialist sub-categories) are not taken into consideration.
DOMESTIC MANAGEMENT COMPANY OF THE YEAR. The South African-domiciled management company with the best overall performance across sectors consisting of a suite of five or more rand-denominated funds with at least three years’ history. CORONATION
Certificate for Second-best Company: ALLAN GRAY
Certificate for Third-best Company: NEDGROUP INVESTMENTS
OFFSHORE MANAGEMENT COMPANY OF THE YEAR. The overseas-domiciled management company with the best overall performance across sectors consisting of a suite of five or more non-rand-denominated funds with at least three years’ history. LLOYDS
TOP OUTRIGHT PERFORMERS
The top performers to December 31, 2012 on a straight performance basis in asset and sector-specific Association for Savings & Investment SA (Asisa) unit trust categories (including the main asset allocation sectors).
Methodology: Funds are ranked on a three-year lump sum NAV-to-NAV basis (in other words, entry costs not taken into account) with income distributions reinvested at the ex-dividend date. Calculations by ProfileData
Best Broad-based Domestic Equity Fund. The fund with the highest ProfileData total investment return ranking over three years in the Asisa domestic equity general, value and growth sub-categories. SASFIN VALUE FUND
Best Domestic Fixed-interest Fund. The fund with the highest ProfileData total investment return ranking over three years in the Asisa domestic fixed-interest bond and income sub-categories. STANLIB BOND FUND (A Class)
Best Foreign (South African-domiciled) Equity Fund. The fund with the highest ProfileData total investment return ranking over three years in the Asisa foreign equity general sub-category. OLD MUTUAL GLOBAL EQUITY FUND (A Class)
Best Offshore Global Equity Fund. The fund with the highest ProfileData total investment return ranking over three years in ProfileData’s offshore global equity general sub-category. FRANKLIN GLOBAL SMALL-MID CAP GROWTH FUND
TOP PERFORMERS ON A RISK-ADJUSTED BASIS
The top performers to December 31, 2012 on a risk-adjusted basis in the asset allocation and real estate sectors plus the largest other Asisa sectors based on market capitalisation. The PlexCrown system, which incorporates risk-adjusted returns and consistency of performance, is used to rank funds for these awards.
Methodology: The PlexCrown system combines risk-adjusted returns based on performance statistics from ProfileData with standard risk measures, consistency measures, and measures of downside risk and managerial skill. Performance over five-year and three-year periods is taken into account.
Best Domestic Asset Allocation Flexible Fund. The fund with the highest PlexCrown rating over five years in the Asisa domestic asset allocation flexible sub-category. REZCO VALUE TREND FUND
Best Domestic Asset Allocation Prudential Fund. The fund with the highest PlexCrown rating over five years in the Asisa domestic asset allocation prudential high equity, medium equity, low equity and variable equity sub-categories. CORONATION BALANCED DEFENSIVE FUND (A Class)
Best Domestic General Equity Fund. The fund with the highest PlexCrown rating over five years in the Asisa domestic equity general sub-category. MARRIOTT DIVIDEND GROWTH FUND (R Class)
Best Offshore Global Asset Allocation Fund. The fund with the highest PlexCrown rating in ProfileData’s offshore global asset allocation flexible and prudential sub-categories. INVESTEC GSF GLOBAL STRATEGIC MANAGED FUND (A Class) (Accumulating)
WINNERS OF CERTIFICATES
TOP OUTRIGHT PERFORMANCE OVER THREE YEARS
The top performers to December 31, 2012 on a straight performance basis in asset and sector-specific Asisa categories (including the main asset allocation sectors).
Methodology: Funds are ranked on a three-year lump sum NAV-to-NAV basis (in other words, entry costs not taken into account) with income distributions reinvested at the ex-dividend date. Calculations by ProfileData
SOUTH AFRICAN FUNDS
Best Domestic Equity General Fund: FOORD EQUITY FUND (R Class)
Best Domestic Equity Industrial Fund: CORONATION INDUSTRIAL FUND
Best Domestic Equity Financial Fund: NEDGROUP INVESTMENTS FINANCIALS FUND (A Class)
Best Domestic Equity Resources & Basic Industries Fund: NEDGROUP INVESTMENTS MINING & RESOURCE FUND (A Class)
Best Domestic Equity Smaller Companies Fund: NEDGROUP INVESTMENTS ENTREPRENEUR FUND (A Class)
Best Domestic Equity Value Fund: SASFIN VALUE FUND.
Best Domestic Asset Allocation Flexible Fund: 36ONE MET FLEXIBLE OPPORTUNITY FUND
Best Domestic Asset Allocation Prudential Fund (includes the prudential high equity, medium equity, low equity and variable equity sub-categories): FOORD BALANCED FUND (R Class)
Best Domestic Fixed-interest Bond Fund: STANLIB BOND FUND (A Class)
Best Domestic Fixed-interest Income Fund: OLD MUTUAL INCOME FUND (R Class)
Best Domestic Real Estate Fund: CORONATION PROPERTY EQUITY FUND (A Class)
OFFSHORE FUNDS
Best Offshore Europe Equity General Fund: FRANKLIN EUROPEAN GROWTH FUND
Best Offshore Far East Equity General Fund: INVESTEC GSF ASIAN EQUITY FUND
Best Offshore USA Equity General Fund: LLOYDS TSB OFFSHORE NORTH AMERICAN FUND
Best Offshore Global Fixed-interest Bond Fund: STANLIB GLOBAL BOND FUND
TOP PERFORMERS ON A RISK-ADJUSTED BASIS OVER FIVE YEARS
The top performers to December 31, 2012 on a risk-adjusted basis in the asset allocation and real estate sectors plus the largest other Asisa sectors based on market capitalisation. The PlexCrown system, which incorporates risk-adjusted returns and consistency of performance, is used to rank funds for these awards.
Methodology: The PlexCrown system combines risk-adjusted returns based on performance statistics from ProfileData with standard risk measures, consistency measures, and measures of downside risk and managerial skill. Performance over five-year and three-year periods is taken into account.
SOUTH AFRICAN FUNDS
Best Worldwide Asset Allocation Flexible Fund: EFFICIENT WORLDWIDE FLEXIBLE FUND
Best Foreign Asset Allocation Flexible Fund: RE:CM GLOBAL FEEDER FUND (A Class)
Best Domestic Asset Allocation Prudential Low Equity Fund: CORONATION BALANCED DEFENSIVE FUND (A Class)
Best Domestic Asset Allocation Prudential Medium Equity Fund: SOUTHERN CHARTER MET BALANCED FUND OF FUNDS
Best Domestic Asset Allocation Prudential High Equity Fund: SOUTHERN CHARTER MET GROWTH FUND OF FUNDS
Best Domestic Asset Allocation Prudential Variable Equity Fund: FOORD BALANCED FUND (R Class)
Best Domestic Fixed-interest Bond Fund: OASIS BOND FUND
Best Foreign Equity General Fund: CORONATION WORLD EQUITY [ZAR] FUND OF FUNDS (A Class)
Best Real Estate Fund: STANLIB MULTI-MANAGER FLEXIBLE PROPERTY FUND (A Class)
OFFSHORE FUNDS
Best Offshore Global Fixed-interest Bond Fund: STANLIB GLOBAL BOND FUND
Best Offshore Global Equity General Fund: RE:CM GLOBAL FUND