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Five situations in which you can apply for an Advanced Tax Ruling

by , 18 August 2015
If there are no tax laws for a particular project or transaction that you are planning - and you are not sure how much tax will apply - then you can get a ruling from SARS showing you exactly how SARS will tax you before the transaction has even taken place.

An Advanced Tax Ruling (ATR) can be applied for through any tax act, with the most common being the Income Tax Act, Value Added Tax Act and the Transfer Duty Act.

ATR's are great as they remove all doubt as to how tax will apply.

Here are five situations in which you can apply an Advanced Tax Ruling...

1. If you introduce an employee benefit scheme and benefit forms part of the employees' gross income, then your company will need an Advanced Tax Ruling.
 
2. You can apply for a ruling on certain aspects around a Black Economic Empowerment (BEE) transaction. 
 
3. You will need a ruling to determine of the amount you get will be capital or revenue when SARS taxes the transaction. 
 
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4. You request a ruling as to whether or not the ring-fencing provisions of section 20(A) of the Act will apply to losses of a proposed new trade. 
 
5. You ask for a ruling on a new section in the Income Tax Act and you are not quite sure as to how any future transactions, which are included in the section, will be affected. 
 
So there you have – five situations in which you can apply for an Advanced Tax Ruling. 
But there is so much more…

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