It’s the end of the year and we will be closing our offices both physical and virtual from Friday 16th December and re-opening Wednesday 4th January. We wish you all a relaxing holiday season.
Likely updates to s18A requirements
If your organisation has approved section 18A status from SARS, this newsletter is to alert you to the fact that SARS has issued a draft notice in terms of section 18A(2)(a)(vii) of the Income Tax Act, 1962 (“the Act”) that lists additional information that must be included on a receipt issued in terms of section 18A(2)(a) of the Act. To be clear, this information is in addition to the basic information that currently has to be included on the receipt.
The draft notice states that a receipt issued in terms of section 18A(2)(a) of the Act will also need to include:
- “Nature” of the donor (e.g. natural person, company, trust)
- In the case of a natural person, the donor identification type and country of issue
- Identification or registration number of the donor
- Tax reference number of the donor (if available)
- Contact phone number of the donor
- E-mail address of the donor
- Unique receipt number
- Trading name of the donor (if different from the registered name)
SARS contends that the additional information required is in line “with evolving best practice of third-party data requirements”. They say that the additional information will enable them both to:
- develop a more efficient process for allowing deductions (for qualifying donors who are South African taxpayers); and
- help prevent section 18A claims abuse.
The additional requirements will be applicable to all section 18A receipts with effect from 1 March 2023 and the required information must be available for SARS reference. In due course, but under a different notice, SARS will prescribe the manner in which the information on the section 18A receipts must be submitted to SARS.
If you wish to make a comment on the content of the draft notice, it must be submitted to Ms Adele Collins at firstname.lastname@example.org by 5 December 2022.
Alternatively, if you need any further information about the requirements related to section 18A receipts, please do contact us.