2017 Budget Summary | KPMG | ZA

2017 Budget Summary

2017 Budget Summary

Below is a summary of the tax proposals that were delivered by Finance Minister Pravin Gordhan at the National Budget address on 22 February 2017. This is a high level overview of the changes.

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Budget

Budget Highlights

  • A new top personal income tax bracket of 45% has been introduced with effect from 1 March 2017 for taxable income above R 1.5 million.
  • Trusts, other than special trusts, will also be subject to income tax at the rate of 45%.
  • The default rate, at which dividends tax is to be withheld, has increased to 20%, with effect from today.
     

Business Incentives

Mining rehabilitation funds:
Mining companies are allowed to deduct contributions made to mining rehabilitation trusts. Amendments are proposed to take into account recent National Environmental Management Act regulations for financial provisioning for the rehabilitation, management and effects of mine closures. Further measures are also proposed to curb abuse of tax-deductible contributions.


Land-reform initiatives:
Tax relief from donations tax and capital gains tax for land donated for land-reform initiatives, as part of the National Development Plan, will be extended to allow partial ownership of land to be transferred under certain circumstances.


Venture capital regime:
It is proposed that changes to the venture capital regime will be made to remove impediments to investment, including rules relating to investment returns and the qualifying company test.
 

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