Group taxation in South Africa : a contextual analysis

Omar, Shaheen

Group taxation in South Africa : a contextual analysis

Master Thesis

2009

Publisher

University of Cape Town

Department

Department of Commercial Law

Faculty

Faculty of Law

Abstract

A group taxation regime can be defined as: "a set of rules that enables corporate taxpayers to compute the tax liability of related corporations on a consolidated or combined basis(.) (and) ... encompasses not only full consolidation. but also tranifer of particular tax allributes between the members (?f a corporate group .. I. This definition is very broad and group taxation could be better understood when considering the more common forms of group taxation such as the group relief regime and the consolidation regime. The consolidation regime generally involves each company within a group of companies computing its own income after which the income is consolidated at the holding company-level for tax purposes. The holding company would thereafter become liable for the group's tax2 , whereas a group relief regime involves the ability of losses incurred by one company in a group of companies to be transferred to another member group company3. Does group taxation exist in South Africa? Based on the above, it would appear not. The more pertinent question that has to be answered is whether or not elements of group taxation currently exist in South African tax legislation. The debate in terms of the introduction of group taxation in South Africa was raised for the first time by the Margo Commission of Inquiry, which ultimately decided against recommending the introduction of group taxation. The Katz Commission of Inquiry however recommended the introduction of group taxation. National Treasury has however failed to act on the Katz Commission's recommendations.

Description

Includes bibliographical references (leaves 89-90).

Keywords

Taxation

Reference:

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Masters

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