Did you know: There are seven different taxes your Trust may have to register for?

Simangele Mzizi, Fsp Business, 11 Nov. 2014

Tags: trusts, sars, trust and registering for tax

If you think Trusts are tax exempt, you’re mistaken.

There are seven different taxes your Trust may have to register for. If you don’t, SARS will charge you harsh penalties and could even prosecute you!

Since that’s a risk you can’t afford to take, keep reading to find out what they are so you can comply.

Seven types of taxes your Trust may have to register for

According to SARS, your Trust may have to register for:
1. Income Tax. To register for Income Tax, complete an IT77TR – (Application for Registration as a Trust and Change in Particulars Trust). Once registered for Income Tax, you (the trustee) will have to submit an Income Tax Return for the Trust every year.
2. Provisional Tax. Your Trust must apply for registration within 21 business days of becoming liable for Provisional Tax.
In this article, experts at the Accounting & Tax Club explain that all Trusts must pay provisional tax regardless of their activities.
Note: The tax rate of your Trust depends on whether it’s special or ordinary.
3. Payroll taxes:
  • Employees’ tax (PAYE). Your Trust must apply for registration as an employer within 21 business days after becoming an employer.
  • Skills Development Levy (SDL). SDL is payable at 1% of the total amount paid in salaries to employees (including overtime payments, leave pay, bonuses, commissions and lump sum payments).
  • Unemployment Insurance Fund (UIF). This is payable at 1% of remuneration paid or payable during the month.
4. Value-Added Tax (Vat). Your Trust must register if an enterprise makes taxable supplies (goods or services subject to Vat of more than R1 million are made in any 12 month consecutive period). A Trust making taxable supplies of less than R1 million may register voluntarily.
That’s not all…

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Your Trust may also be liable for the following taxes:

5. Donations Tax – Payable at 20% on the value of any gratuitous disposal of property.
6. Transfer Duty – Payable at a sliding scale on the value of property transferred.
7. Securities Transfer Tax (STT) – Levied on the transfer of a security at 0.25% of the taxable amount of the security.
Now that you know about the types of taxes your Trust may have to register for, find out if yours qualifies so you can comply and avoid penalties.

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