Advice on tax relief available to employers
Advice regarding the deferral of provisional tax liability
Advice regarding SDL payment holidays
Tax advice in regard to restructuring, mergers and acquisitions
Tax advice in regard to licensing and transfers of intellectual property
Key contacts
Essential business insights
FAQ
Does a company qualify for any tax relief when it enters business rescue proceedings?
A senior South African Revenue Service (“SARS”) official may temporarily ‘write-off’ an amount of tax debt for the duration of the period that the company is subject to business rescue proceedings. This does not absolve the company from the liability for that tax, but merely postpones the payment thereof. A senior SARS official may decide to write-off permanently if the debt due to SARS is uneconomical to pursue.
Will this tax relief be effective automatically when a company enters enter business rescue proceedings?
No, the company must submit a formal request to SARS as provided for in Section 201 of the Tax Administration Act. Upon acceptance of the company’s request for tax relief, the company will be required to enter into an agreement with SARS setting out the terms and conditions of the tax relief.
Will the company be able to continue to carry forward its assessed loss if it enters business rescue proceedings?
Provided that the company continues to carry on a trade and meets the general requirements of the assessed loss legislation, it should be able to continue to carry forward its assessed loss.