What would life be without another update on our dear EFF leader?

We reported a few weeks ago about Julius Malema’s rather interesting SARS saga, where Juju was “abiding by the conditions of a compromise agreement made last May that gave him time to settle the R18m he owed in taxes and interest”.

His SARS situation was thought to have blown over in 2014, but 2015 saw it rise from the flames like a phoenix. What has caused the issue to resurface? Rather interestingly the concern is “donations tax”.

This explanation from BizNews:

Malema would obviously contest that the amounts were not earned for services rendered. That in itself could be disputed. But what is certain is that if the amount was not earned and subject to income tax then, by default, it must be subject to donations tax. So SARS is assured of donations tax at 20% rather than contesting an income tax assessment at 40%. So, at first glance, SARS has obviously settled on the basis of ‘a bird in the hand is worth two in the bush’.

Has SARS taken the easy way out? Apparently not. “If SARS had sought to recover income tax and it is accepted that Malema has nothing then the whole exercise is academic. There would be no recovery,” says BizNews.

Let’s explain donations tax: “The tax may be less, but the tax is imposed on the donor (Malema’s benefactors) or, failing them, on the recipient”, meaning that at least some money will be recovered.

Let’s be honest though – Malema has swindled his way out of so many tax payments to SARS that it could take forever to get everything all sorted. And what’s worse is that he doesn’t even have a plan on how to pay it all back. If you’re concerned about why Malema’s tax situ was made public and are scared yours will, don’t worry. Taxpayer’s affairs remain private unless an individual hasn’t “complied with the tax administration act”. If the matter goes to court, the matter comes out in the open. Moral of the story here is don’t mess around with your tax: I suggest you don’t follow in his footsteps and instead get your tax done properly at Galbraith Rushby. It is embarrassing when your finances become the talk of the town.

[Source: BizNews]