Your return must be rendered by 5 June 1998.

Where you are authorised to close your accounts on a date other than 28/29 February, your return must be submitted within 60 days of such authorised date.

If you are unable to render the return within the prescribed period, you must apply for an extension in writing to the Receiver of Revenue to whom you render your return.

If you have already rendered a return for this year, return this form stating your income tax reference number and the Revenue Office to which you sent the previous return.

If there is insufficient space for any item on the return, a separate statement giving the required details must be attached to your return.

IF YOU HAVE RECEIVED A RETURN, IT MUST BE COMPLETED AND RENDERED IRRESPECTIVE OF WHETHER OR NOT YOUR NET REMUNERATION EXCEEDED R60 000 PER ANNUM.

DO NOT INCLUDE ANY PAYMENTS OR CORRESPONDENCE WITH YOUR RETURN.

PART 1:
How to complete your return

PARAGRAPH NUMBERS OF THIS BROCHURE CORRESPOND WITH THOSE OF THE RETURN.

PERSONAL PARTICULARS
FILL IN THE WHITE AREAS ONLY WHERE PARTICULARS HAVE CHANGED OR HAVE NOT BEEN PRINTED IN THE SHADED AREAS.

1.13 Furnish your PAYE reference number if you are registered for employees tax purposes.
1.14 Furnish your VAT registration number if you are registered for purposes of VAT.
1.15 These particulars must be furnished to enable any possible refund to be paid directly into your bank account, thereby preventing the possibility of a cheque being stolen or cashed unlawfully. It is essential th at you immediately inform your local Receiver of Revenue (in writing) of any changes in the particulars. The assessment notice will indicate whether your account has been credited or a cheque has been issued to you.
1.17 THE RETURN MUST BE SIGNED BY YOU.
1.18 Since many taxpayers make use of the services of accountants, bookkeepers and tax consultants and, therefore, do not use this brochure, this question must be answered in order to reduce printing and distribution costs.

Liability for provisional tax

A person who derives income from sources other than remuneration (e.g. business, farming, interest and rent) and whose taxable income from such sources exceeds R1 000 per year, is regarded as a provisional taxpayer.  A person (excluding a director of a private company or a person who carries on any business) who is over 65 years of age and whose taxable
income for the year does not exceed R50 000 need not, under certain circumstances, register as a provisional taxpayer.

PART 2
Income

All income/benefits, in cash or otherwise, received by or accrued to you or your minor children (see paragraph2.4.4) during the tax year must be declared in your return. Amounts received from any employer in the Republic during your temporary
absence from the Republic, must be declared.

Marriages in community of property

The taxable income of a spouse married in community of property will, in the case of: Income received or accrued from carrying on any trade (excluding the letting of fixed property), be deemed to be the income of the spouse who is carrying on the trade. Where the spouses are trading in partnership, the income will, subject to the anti-avoidance provisions (see paragraph 11.7 on page 13), accrue in the agreed profit-sharing ratio. Any benefit paid by a pension, provident, benefit or retirement annuity fund is deemed to be trade income and will be taxed in the hands of the member or past member of the fund. Any annuity received as a result of a purchased annuity, as defined in section 10A of the Income Tax Act, is also deemed to be trade income and will be taxed in the hands of the person to whom the annuity is payable. Income received or accrued otherwise than from the carrying on of any trade, (e.g. interest), including rental from the letting of fixed property, in respect of assets forming part of the communal estate, is deemed to accrue to the spouses in equal portions. Where the income doesn’t accrue to the communal estate, it will be included in the income of the spouse who owns the asset (this income must be clearly identified).
Where any spouse’s income is deemed to be the income of the other spouse (e.g. rental), any deductions or allowances relating to that income will be allowed in the same proportion in which the income is taxed. The total investment income received by both spouses must be delivered in both the husband’s and the wife’s return of income. The return
provides for a split to be made.

Marriages out of community of property

Income is taxed in the hands of the spouse to whom such income accrues.

2.1 and 2.2 REMUNERATION, SERVICE BENEFITS AND PENSIONS
Examples of income/benefits which must be included in your return: Receipts and accruals for services rendered/to be rendered. *Clothing  *Director’s fees *Service and fringe benefits *Gratuities *Commission *Overtime
*Wages and salaries *Allowances *Options/rights to purchase shares, etc. *Bonuses *Incentive awards
*Pensions *Tips
All IRP5 and IT3(a) certificates must be attached to page 7 of your return.

Pensions

A pension must be declared as taxable income if the services in respect thereof were rendered in the Republic for at least two out of the ten years immediately preceding the date on which the pension became payable for the first time. If the pension was awarded for services rendered within and outside the Republic only that portion of your pension in respect of services
rendered in the Republic will be from a source in, and subject to tax in the Republic. If you are entitled to such an apportionment, furnish particulars of your periods of service in the Republic as well as the total period of service in respect of which the pension is paid. Pensions awarded by the Government, Transnet, Provincial administrations and local authorities, are taxable in full, except where a double taxation avoidance agreement provides otherwise. Pensions paid in terms of the Workmen’s Compensation Act must declared.

Exempt pensions
(Part 12)

The following pensions are exempt from tax:

*War veterans pensions.
*Compensation in respect of disease contracted by persons employed in the mining industry.
*Disability pensions paid under section 2 of the Social Pensions Act.
*Any compensation paid in terms of the Compensation for Occupational Injuries and Diseases Act.

Marketable securities

2.2.1 OPTIONS/RIGHTS TO ACQUIRE MARKETABLE SECURITIES

Gains made by a director or employee in respect of the exercise, cession or release of a right to acquire marketable securities, i.e. securities, stock, debentures, shares, options or other interests capable of being sold on a stock exchange or otherwise (this also includes share, etc. in private companies), must be declared as income if that right was awarded either in the capacity as a director or former director, or in respect of services which have been rendered or are still to be rendered to an
employer. Full particulars must be furnished on a separate sheet. 

Insurance policies

2.2.2 INSURED POLICIES CEDED

If the ownership of an insurance policy was transferred to you by your employer, the taxable value must be declared here. A valuation certificate must be submitted (also see part 11.2).

Investments

2.3 INCOME FROM INVESTMENTS (Part 9)

*If you are either married OUT OF community of property or UNMARRIED, the total income from investment must be carried to part 2.3.1 of the return.
*If you are married IN community of property, only half of the income form investment must be carried to part3.1 of the return. The other half is taxable in the hands of your spouse.
*An income advice in respect of all investments is to be obtained from the institution where your funds are invested and attached to page 7 of your return.
*THE FIRST R2 000 OF THE TOTAL AMOUNT OF -
    *interest from any interest bearing investment;
    *dividends / interest from a property trust;
    *dividends on shares in mutual building society; and
    *interest on deposits in a building society (which deposits are the same as shares in a mutual building society) which is not otherwise, is exempt from tax.
*The gross amounts must be declared. The exemption will be calculated and allowed by the Receiver of Revenue.
*All investment income received by or accrued to you, or your minor children (see paragraph 2.4.4) must be declared (including investment income which has not been paid to you but has been utilised, accumulated or re-invested for you or your minor children’s benefit).
*Where interest is claimed as a deduction against investment income received, full particulars (i.e. amounts invested/borrowed, interest rates, date of each loan and investment) must be furnished.
*Your spouse must be taken on register as a provisional taxpayer if his/her gross income exceeds R3 000.

2.3.1 TAXABLE INTEREST (Part 9.1)

*All taxable interest (including dividends from property trusts - these dividends are taxed as interest - and the interest content of a unit trust fund distribution).
*Interest on savings accounts, transmission accounts, fixed deposits in a building society or a mutual building society and dividend/interest on fixed period shares/deposits made on or after March 1990 must be declared here.
*Interest from a country other than the Republic (see paragraph 2.3.1.2 of this brochure).
N.B. SHOW GROSS AMOUNTS OF ALL INVESTMENT INCOME AS THE EXEMPTIONS WILL
BE DONE BY THE RECEIVER OF REVENUE.
*Dividends received or accrued from any company (including the dividend portion of a unit trust distribution) are exempt from tax. These dividends must be shown in Part 12 of your return.

Section 24J

2.3.1.1 SECTION 24J

*During 1995 the Income Tax Act was amended in so far as it relates to the accrual of interest. An accrual basis has been introduced by section 24J of the Income Tax Act, 1962, which recognises the spreading of interest on a day to day basis for tax purposes, where interest must be compounded at least on an annual basis. In respect of individuals these provisions apply only to financial instruments which have term exceeding one year (determined from the date of acquisition) and were
acquired at a discount/premium or bear deferred interest.
*A financial instrument which bears deferred interest is an instrument where stepped interest rates are applicable or an instrument in terms of which all interest, calculated by applying a constant interest rate over the term of the instrument, is not paid at regular intervals of 12 months or less.
*It must be noted that the majority of commonly used financial instruments by most individuals will be excluded from the ambit of section 24 as far as the accrual of interest is concerned. Instruments or investments excluded are inter alia:

    *Savings accounts;
    *Call accounts;
    *32 Day call accounts;
    *Fixed Deposits not exceeding one year; and
    *Fixed Deposits the term of which is longer than one year but all the interest, calculated at a rate of interest which does not         vary, is paid at least annually.

*Interest has been defined for purposes of section 24J and includes any related finance charges, discount receivable or premium payable in terms of or in respect of an instrument. For a holder of an instrument, which will include an investor in stock, the interest which will be taxable consist of the difference between the purchase price of the stock and the nominal value of the stock as well as the amounts of all coupon payments receivable by the holder of the instrument.
*The effect of the accrual basis is that the taxable interest is not based on the actual coupon receipts, but on an amount determined with reference to the Internal Rate of Return (IRR) of a financial instrument, based on the future cash flow determined on the date of acquisition of the financial instrument.

Investment income from another country

2.3.1.2. Income from investment from a country other than the Republic.
Due to the relaxation of exchange controls with effect from 1 July 1997 , and the expected outflow of capital into foreign
investments , it was necessary to introduce certain measures which are primarily designed to protect South African tax base against  the loss of revenue arising from investment income earned abroad  by persons ordinarily resident in South Africa. These measures are contained in the provisions of section 9C and 9D.
* A resident is now subject to income Tax on income received/ accrued in respect if capital invested in his/her own name
(directly) (section 9C) as well as capital invested via an offshore  entity (indirectly) (section 9D).
* The provision of 9C and 9D will be applicable to investment income  received/ accrued on or after 1July 1997.

DEFINITIONS AS CONTAINED IN SECTION 9C
*''Investment income'' - means any income in the form of annuities , interest, rentals, royalties and any income of a similar nature.
*Annuity'' - follows its ordinary meaning , but excludes:
    * pensions in consideration of past employment and,
    *payments under the social security system of any other country.
* ''Interests'' - mean interest and amounts contemplated in sections 24 (interest, related finance charges, discounts, premiums, etc. - refer to point 2.3.1 of this brochure) and 24K ( interest rate  agreements ) interest of affected instruments ( e.g. certain  preference shares), income arising from money lent, etc.  
*" Rental Income '' - means any amount received by or accrued to a person as consideration for the use of, or the right to use, any   movable or immovable property.
*"Royalty'' - means any natural person who is ordinarily resident  in South Africa and any person other than a natural person , which has its place of effective management in South Africa, e.g..  companies , close corporation , trusts and any other type of corporate entity.
* ''Permanent establishment '' - follows the meaning assigned to it in terms of the international Model Tax Convention on Income and on Capital of the Organisation for Economic Co-operation and Development.

DEFINITIONS AS CONTAINED IN SECTION 9D
* "Controlled foreign entity'' means a foreign entity in which any resident / residents , individually or jointly , directly or
indirectly, have more than 50percent of the participation rights or are entitled to exercise more than 50 percent of the votes or
control the entity.
* ''Foreign Entity '' - is restricted to persons, other than natural persons, whose place of effective management is outside the Republic. This will also include a trust.  * ''Participation rights'' - means the right to directly or indirectly participate in the capital or profits of dividends  declared by, or any other distribution or allocation made by the  entity.
* ''Resident '' and'' Investment income'' - same meaning as in section 9C.

DEDUCTIONS ALLOWED
* The section 11 deductions will apply to investment income earned by a controlled foreign entity in the course of the carrying on of its trade outside the Republic , provided that:-
* any deduction shall be allowed on a appointment basis.
* deductions shall be limited to the investment income; and
* any excess shall be carried forward to the following year.

REBATES
* A resident will be allowed a rebate (in terms of section 6quat) against normal tax, any foreign tax payable by the resident or the controlled foreign entity on the proportional amount of the investment income of such controlled foreign entity which is to
be included in the Income of the resident. 
* Proof of payment of such tax must be submitted (refer to 2.4.4 of this brochure)

CURRENCY CONVERSION
* The amount appointed to any resident, shall be converted in the monetary unit of the Republic at a date not later than the end of  the financial year of the resident.
* Ruling exchange rate at that date shall apply .
* The same will apply in respect of expenditure.

NB. THE INFORMATION REQUESTED IN THE SCHEDULE TO THE INCOME TAX RETURN MUST BE FURNISHED, SO AS TO ENABLE THE COMMISSIONER FOR THE SOUTH AFRICAN REVENUE SERVICE TO DETERMINE TO WHAT EXTENT SUCH INCOME IS TAXABLE IN THE REPUBLIC.

2.4 INCOME FROM OTHER SOURCES

2.4.1. RENTAL: (PART 8)
* If you are either married OUT OF community of property or unmarried , the total profit/loss must be carried over to part 2.4.1 of the return.
* If you are married IN community of property , only half of the profit /loss must be carried over to part 2.4.1. of the return.
The other half is taxable in the hands of your spouse.
* If you occupied a portion of a property let by yourself, or if someone else has occupied it rent free, state the portion of the  expenses claimed against rental income which relates thereto.
* Rent pending the exercise of an option to purchase ( irrespective of the fact that such rent may be set off against the eventual purchase price ) is taxable
* Rental income from a country other than the Republic ( see  paragraph 2.3.1.2 ).

2.4.2 ANNUITIES
* Annuities from retirement annuity funds must be shown here.

2.4.3 OTHER ANNUITIES
* Annuities from ex-employers, insurance policies, trusts, estates and purchase annuities must the declared here. The name of the employer , insurance company , estate , trust or fund who/which paid  the annuity , the nature and/or person for the payment and the amount thereof must be shown. The capital content of a purchased annuity is exempt from tax .
A certificate from the insurance company, reflecting the capital  content , must be attached.
* A lump sum (excluding capital element ) received or accrued in consequence of the retirement of the termination or commutation of a purchased annuity is taxable and must the shown here.
* Annuities from a country other than the Republic excluding  pensions in consideration of past employment and payments under the social security of that country.

2.4.4 OTHER RECEIPTS AND ACCRUALS
* EXECUTORS, CURATOR'S OR SIMILAR FEES, ROYALTIES, HONORARIA AND ANY PAYMENT ,ACCRUAL OR RECEIPT, FROM WHATEVER SOURCE, PARTICULARS OF THE NATURE AND ORIGIN OF THE INCOME MUST BE SET OUT ON A SEPARATE  SHEET , IF YOU WISH TO CLAIM A REBATE IN RESPECT OF FOREIGN TAX PAID, FURNISH FULL PARTICULARS OF THE CLAIM , INCLUDING PROOF THAT PAYMENTS OF SUCH TAX WAS MADE WITHOUT ANY RIGHT OF RECOVERY.

* INCOME OF MINOR CHILDREN . You are liable for the payment of tax  on any income which has been received by or accrued to or in favour of any of your minor children or has been spent on the maintenance, education, or for the benefit of the child, or was   accumulated for the benefit of the child , if such income arises  from a donation , settlement or other disposition by - (i) you ; or (ii) any other person, if you made a donation , settlement , or other  disposition or gave some other consideration directly or indirectly in favour of the other person or his family.
* You minor child will, however, be liable for tax on income which is received by or accrues to him/her independently of yourself; in his/her or received as a gift from any person other than the  person mentioned in (i) and (ii) above or from any other source. This income must be shown in part 12.4 of your return. Should  your child’s taxable income be a sufficient to render him/her  liable to tax, you, as the legal guardian, must obtain and submit  an income tax return on his /her behalf.

* FOREIGN INVESTMENT COMPANIES, Income derived by you from a foreign investment company or similar institution is taxable to the extent of your interest in the untaxed profits of such  institution. details of such interest must be furnished.

2.4.6. (2.4.8. in IT 12) LUMP SUM BENEFITS
* Lump sum benefits from pension, provident and retirement annuity  funds must be declared . If tax was deducted, the IRP 5 certificate  must be attached to page 7 of your return. The Receiver of Revenue will determine the taxable portion of the
benefit and the applicable rate of tax.

2.4.7 (2.4.9 in IT 12 ) GRATUITIES
* Any amount received from your employer in the form of a gratuity , including amounts received as a result of the
termination of your services, must be declared. 
* The Receiver of Revenue will determine the taxable portion and the applicable rate of tax.
* THE CIRCUMSTANCES UNDER WHICH ALL SUCH AWARDS WERE MADE, MUST  BE SET OUT IN DETAIL AND THE AMOUNT MUST BE SHOWN SEPARATELY FROM OTHER REMUNERATION.

2.4.8 (2.4.10 in IT 12) PROTO - TEAMS
* Income received by or accrued to a mineworker, over and above his normal remuneration and allowance, as a member of proto-team for performing any hazardous task during an emergency in a mine, must be declared here.
* The Receiver of Revenue will determine the applicable rate of tax.