South Africa: SARS issues tax exemption guide for public benefit organization

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The South African Revenue Service (SARS) has issued a tax exemption guide on the income tax exemption for a public benefit organization (PBO) carrying on a public benefit activity (PBA).

The guide provides general guidance on approval and taxation of public benefit organisations and approval under section 18A to issue tax-deductible receipts. The guide deals with the some taxes area like income tax, donation tax, estate duty, transfer duty, dividends tax, capital gains tax, value-added tax, employees’ tax and customs and excise etc. that may affect organisations approved as public benefit organisations. Information relating to taxes, duties, levies and contributions reflect the rates applicable as at the date of issue of this guide.

The guide is not an “official publication” as defined in section 1 of the Tax Administration Act 28 of 2011 and accordingly does not create a practice generally prevailing under section 5 of that Act. It is also not a general binding ruling under section 89 of the Tax Administration Act. Should an advance tax ruling be required, visit the SARS website for details of the relevant application procedure.

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