Short Course in Personal Income Tax within South Africa

Name: Short Course in Personal Income Tax within South Africa
Rating: 4.4 (43 reviews)

Personal Income Tax: Income; Deductions; Salaried Employees; Tax Implication of a Natural Person; Capital Gains Tax

Created byThe Tax Faculty (South Africa)

Last updated 7/2024

English

What you'll learn

Demonstrate an understanding of when income received by an individual taxpayer should be taxed and when deductions are claimable.
Differentiate between fringe benefits and allowances and the inclusion in a taxpayer’s taxable income
Calculate the taxable income of an individual taxpayer within a South African context
Demonstrate an understanding of the process of submitting final tax returns to the South African Receiver of Revenue.

Course content

19 sections • 78 lectures • 13h 5m total length

Introduction to Personal Income Tax0:46
As tax is both a legal requirement and social responsibility, it is critical that all individuals have a solid grasp of the principles of taxation and their related obligations. During this course, you will develop the foundational principles of personal income tax and cover cover practical issues impacting individual taxes such Airbnb/rental income, home office expenses, medical tax credits and travel allowances. Upon completing this short course, you will be empowered to manage your personal tax affairs.
Hanri Van Der Merwe, a senior Tax lecturer at the Tax Faculty, has created an introductory recording on the aspects that you will learn on this course.

The following Modules are included in the course:
Introduction to tax.
Income.
Deductions.
Salaried employees.
Tax Implication for Natural Persons.
Introduction to Capital gains Tax.
The modules are divided into topics. Each topic will have a downloadable knowledge guide, additional reading material and links to short lecture videos that are not more than twenty minutes in length.
The study guides will reference to certain Acts and SARS guides.
The Tax Faculty has teamed up with LexisNexis to bring you applicable Tax related legislation.
Introduction video2:02

Introduction to Special Inclusions0:27
Special rules exist that override the gross income definition as discussed in topic 1. These special rules are called “special inclusions” and are included in the gross income of a natural person. These special inclusions can be found in section 1 of the Income Tax Act alongside the gross income definition.

The second part of the gross income definition from paragraph (a) to (n), list a number of specific inclusions. They are receipts and accruals (amounts) that will be specifically included in gross income.

Reading Material:
Work through the Knowledge Guide: Special Inclusion
Video Time:
Watch the Knowledge Video: Special inclusions (11 min)
Self - Assessment Knowledge Quiz:
Complete Quiz: Special Inclusion
Video: Special Inclusions10:41
Special rules exist that override the gross income definition as discussed in topic 1. These special rules are called “special inclusions” and are included in the gross income of a natural person. These special inclusions can be found in section 1 of the Income Tax Act alongside the gross income definition.

The second part of the gross income definition from paragraph (a) to (n), list a number of specific inclusions. They are receipts and accruals (amounts) that will be specifically included in gross income.

Reading Material:
Work through the Knowledge Guide: Special Inclusion
Video Time:
Watch the Knowledge Video: Special inclusions (11 min)
Self - Assessment Knowledge Quiz:
Complete Quiz 2: Special Inclusion
Quiz: Special Inclusions

Topic 3: Exempt Income - Introduction0:24
In Topic 3 you will be introduced to the concept of “exempt income”. These are amounts that constitute gross income and have, therefore, been included in the calculation of gross income, but should not be taxed and therefore "deducted" as exempt.

Reading Material:
Work through the Knowledge Guide: Exempt Income
Video Time:
Watch the Knowledge Video: Contextualising Exempt Income (3 Min)
Watch the Knowledge Video: Exempt Taxpayer (6 Min)
Watch the Knowledge Video: Exempt Income Stream (23 Min)
Watch the Knowledge Video: Exempt Income For non-residents (5 Min)
Self - Assessment Knowledge Quiz:
Complete Quiz 3: Exempt Income
Video 1: Contextualising Exempt Income3:04
Video 2 : Exempt Taxpayer6:48
Video 3 : Exempt Income Stream23:20
Video 4 : Exempt Income For non-residents6:21
Quiz: Exempt Income

Introduction to the Practical Guide and Simulation0:37
The individual declares his or her taxable income to SARS annually on the ITR12 income tax return. The ITR12 return can be submitted electronically on eFiling, manually or the taxpayer can visit a SARS office and a SARS official will assist the taxpayer to complete the return electronically.
After submitting the ITR12 return to SARS, an assessment, called the ITA34 Assessment, will be issued by SARS based on the taxable income declared.
The due date for submission of income tax returns is published annually in the Government Gazette. eFiling is the quickest, easiest and most convenient way to submit the return and is the option recommended by SARS. If a taxpayer does not submit their return by the relevant deadline, they will be liable for an administrative penalty due to non-compliance.
This practical guide provides guidance for tax submissions by a taxpayer.

Reading Material:
Work through the Practical Guide: Income
Video 1: Income Self Guided Practical Simulation Activity Question47:59
Video 2: Income Self Guided Practical Simulation Activity Question6:31

Introduction to Deductions0:56
The Act prescribes that taxpayers can make deductions to their income in order to determine their taxable income. Taxable income is the amount that remains after the deducting all allowable deductions and allowances from income. The main sections that deal with deductions in the Act are section 11 to section 18A, section 22 to section 24.
In this module, we will concentrate on the general deduction formula outlined in section 11(a). This section always has to be read and applied with section 23(g).

The Topics and subtopics in this module are:
Topic 1: The General Deduction Formula
Contextualising deductions
Expenditure and Losses
Actually incurred
Carrying on a trade
Year of assessment
In the production of income
Not of a capital nature

Topic 2: Specific and prohibited deductions

Specific and prohibited deductions

Work through the learning activities outlined in Topic 1: General Deductions and the associated quiz, Topic 2: Specific and Prohibited deductions and quiz and finally the practical guide and simulated return.

After studying this knowledge module, you will be able to:
Identify where the deductions would be included in the tax calculation framework.
Apply the qualifying criteria to determine whether an amount is deductible under the general deduction formula.
Explain how to treat expenses incurred before a taxpayer started to trade.
Identify where deductions are declared to SARS on the income tax return (ITR12).

Introduction to General Deductions0:54
At this point in your learning journey, you should understand that a person is taxed on his/her taxable income. You would also now have a broad understanding of which amounts are included in gross income and which items are regarded special inclusions, and exempt income.
We are sure you would now like to understand what amounts can be deducted from income to determine the person’s taxable income. Surely it would not be fair to tax a person on their full income and not recognise that there were certain expenses incurred in order to generate that income.
It is therefore logical that certain amounts (one of which is allowable deductions) should be deducted from income to determine taxable income.

Reading Material:
Work through the Knowledge Guide: The General Deduction Formula
Additional reading:
Home-Office-Expenses-Deductions

Video Time:
Watch the Knowledge Video 1: Contextualising deductions (10 Min)
Watch the Knowledge Video 2: Expenditure and losses (8 Min)
Watch the Knowledge Video 3: Actually incurred (17 Min)
Watch the Knowledge Video 4: Carrying on a trade (12 Min)
Watch the Knowledge Video 5: Year of assessment (9 Min)
Watch the Knowledge Video 6: In the production of income (30 Min)
Watch the Knowledge Video 7: Not of a capital nature (13 Min)
Self - Assessment Knowledge Quiz:
Complete the Quiz: Topic 1-The General Deduction Formula
Video 1: Contextualising Deductions9:58
Video 2: Expenditure and Losses8:23
Video 3: Actually Incurred17:25
Video 4: Carrying on a Trade12:04
Video 5: Year of Assessment9:04
Video 6: In the Production of Income29:46
Video 7: Not of a Capital Nature12:34
Quiz: General Deductions

Introduction: Specific and Prohibited deductions0:17
In Topic 1, we investigated the general deduction formula. In Topic 2 we will look at specific deductions that will be allowed and also at certain deductions that will be prohibited. This overrules the general deduction formula.

Reading Material:
Work through the Knowledge Guide: Specific and Prohibited Deductions

Video Time:
Watch the Knowledge Video: Specific and Prohibited Deductions (15 Min)

Self - Assessment Knowledge Quiz:
Self-Assessment Knowledge Quiz: Specific And Prohibited Deductions
Topic 2: Specific and Prohibited deductions12:29
Quiz: Specific and Prohibited deductions

Requirements

Learners must have digital and numeracy literacy, with a basic accounting understanding.
Equipment required is a Laptop/PC with high speed internet with access to microsoft excel.

Description

As tax is both a legal requirement and social responsibility, it is critical that all individuals have a solid grasp of the principles of taxation and their related obligations. During this course, you will develop the foundational principles of personal income tax and cover cover practical issues impacting individual taxes such Airbnb/rental income, home office expenses, medical tax credits and travel allowances. Upon completing this short course, you will be empowered to manage your personal tax affairs

Key Objectives of this course:

Demonstrate an understanding of when income received by an individual taxpayer should be taxed and when deductions are claimable.
Differentiate between fringe benefits and allowances and the inclusion in a taxpayer’s taxable income.
Evaluate various options for the structuring of salary packages
Calculate the taxable income of an individual taxpayer.
Identify the various tax instruments and the structural elements of the Income Tax Act
Demonstrate an understanding of the basic mechanics of income tax Identify the different tax role players and the different tax types
Demonstrate a basic understanding of how income tax is calculated
Demonstrate an understanding of the process of submitting final tax returns
Demonstrate a basic understanding of what the Tax Administration Act is and what a tax practitioner is

Who this course is for:

Self-employed Individuals looking to maximize tax savings within South Africa.
Salaried employees who need to understand their income tax within South Africa
Retired individuals or anyone seeking to demystify the personal income tax process.

Short Course in Personal Income Tax within South Africa

What you'll learn

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Course content

Introduction to Personal Income Tax2 lectures • 3min

Module 1: Introduction to Taxes in South Africa9 lectures • 1hr 16min

Module 2: Income - Introduction1 lecture • 1min

Module 2: Income - Topic 1: Gross Income7 lectures • 1hr 21min

Module 2: Income - Topic 2: Special Inclusions2 lectures • 11min

Module 2: Income - Topic 3: Exempt Income5 lectures • 40min

Module 2: Income - Practical Guide and Simulation3 lectures • 55min

Module 3: Deductions - Introduction1 lecture • 1min

Module 3: Deductions - Topic 1: General Deductions8 lectures • 1hr 40min

Module 3: Deductions - Topic 2: Specific and Prohibited Deductions2 lectures • 13min

Requirements

Description

Who this course is for: