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Application for Transfer Duty Exemption in terms of ...

Transfer DUTY. Application for Transfer Duty Exemption in terms of Section 9(15) of the Transfer Duty Act, No. 40 of 1949 ( Transfer Duty Act) and Request for Security Law Society of South Africa External Stakeholders Reference: AS-TD-L03. Date: 04 August 2010. South African Revenue Service Tel: 0800 00 SARS (7277). Application FOR Transfer DUTY Exemption IN terms OF SECTION 9(15) OF THE. Transfer DUTY ACT, NO. 40 OF 1949 ( Transfer DUTY ACT) AND REQUEST FOR. SECURITY. Following discussions with the Law Society of South Africa (LSSA), the South African Revenue Service (SARS) has revised the process for Transfer duty Exemption applications (TD5), in terms of section 9(15) of the Transfer Duty Act. The revised process, as set out below, will be implemented with immediate effect.

transfer duty application for transfer duty exemption in terms of section 9(15) of the transfer duty act, no. 40 of 1949 (transfer duty act) and request for

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1 Transfer DUTY. Application for Transfer Duty Exemption in terms of Section 9(15) of the Transfer Duty Act, No. 40 of 1949 ( Transfer Duty Act) and Request for Security Law Society of South Africa External Stakeholders Reference: AS-TD-L03. Date: 04 August 2010. South African Revenue Service Tel: 0800 00 SARS (7277). Application FOR Transfer DUTY Exemption IN terms OF SECTION 9(15) OF THE. Transfer DUTY ACT, NO. 40 OF 1949 ( Transfer DUTY ACT) AND REQUEST FOR. SECURITY. Following discussions with the Law Society of South Africa (LSSA), the South African Revenue Service (SARS) has revised the process for Transfer duty Exemption applications (TD5), in terms of section 9(15) of the Transfer Duty Act. The revised process, as set out below, will be implemented with immediate effect.

2 1. The Process On receipt of a Transfer duty Exemption Application (TD5), SARS will assess the vendor's tax compliance concerning all taxes with regard to the submission of returns and payments. If there is repeated non-compliance ( non-filing of returns or non-payment of taxes on more than one occasion for each tax type), the vendor's representative in this instance the attorney will be informed of the options available to the vendor before the Transfer duty Exemption certificate can be issued. 2. The Options The vendor must: Resolve all outstanding tax obligations; or Provide security for the Value-Added-Tax (VAT) payment in respect of the property transaction for which the TD5 Application is being made; or Instruct the attorney to provide an undertaking for the VAT payment in respect of the property transaction for which the TD5 Application is being made.

3 These options are discussed in detail below. Resolve all outstanding tax obligations (a) The vendor must submit all outstanding returns and/or pay all outstanding taxes before the Transfer duty Exemption certificate can be issued. (b) The returns and/or payments must be captured and must reflect on the SARS systems, or the vendor must have proof of submission or payment before the Transfer duty Exemption certificate can be issued. Provide security for the VAT payment in respect of the property transaction for which the TD5. Application is being made (a) Where the vendor has outstanding tax obligations in terms of any tax act administered by the Commissioner for SARS, SARS may request security for the VAT owed in respect of the property Versions: Time Stamp: 2010-08-04 Form ID: LetTDexm Page of Page: 01/02.

4 Transaction for which the TD5 Application is being made. (b) Where SARS requests security for the VAT owed, the vendor can elect to provide such security, in which case paragraphs c to h below will apply. Where the vendor elects not to provide the security, the vendor must resolve his/her tax affairs with SARS as explained above. (c) Where security is required, a Request for security (VAT212) will be provided to the attorney and a copy will be sent to the vendor. (d) Where security is required such security must be in the form of a bank cheque, which is the only form of security acceptable to the Commissioner. (e) The amount of the security in respect of the property transaction for which the TD5 Application is being made must be equal to the VAT amount in respect of that property.

5 The security payment in respect of the VAT for the property will be allocated to the vendor's VAT account for the tax period in which the Transfer of the property is anticipated to take place. (f) Regardless of having paid the security referred to above, the vendor must declare and pay the full VAT. on the property transaction in question on the relevant VAT return when due. (g) The vendor may apply for that security to be offset against the VAT liability for the tax period in which the sale of the property must be declared. (h) Where the vendor pays the full amount of the VAT but does not apply for the security to be offset against his/her VAT liability for the relevant tax period, the vendor may apply for the refund of the security.

6 However, the amount may be offset against outstanding VAT in respect of any other tax period before it is refunded. (i) The request for security is only in respect of section 9(15)(b) of the Transfer Duty Act. If during this process it is determined that there are outstanding returns and/or payments in respect of VAT and/or other taxes, a distinctly separate recovery process from the current TD5 Application will be followed in order to secure such outstanding returns and/or taxes. The separate recovery process will in no way interfere with the current TD5 Application process. Instruction to the attorney to provide an undertaking for the VAT payment in respect of the property transaction for which the TD5 Application is being made (a) SARS will issue the Value-Added-Tax (VAT) Payment Undertaking (TD-VAT) in respect of Transfer Property, as legislated in section 9(15) of the Transfer Duty Act, The undertaking provided must be made using the TD-VAT form.

7 (b) The undertaking must be signed by the representative vendor as reflected on the SARS system. If the details of the representative vendor are incorrect on the SARS system, the vendor must update such information before the undertaking is accepted. (c) The undertaking must be given for the VAT amount charged in respect of the property transaction for which the TD5 Application is being made, and not for any other VAT amounts. (d) In terms of the undertaking, the attorney must pay the VAT amount to SARS within five working days after registration of the property in the Deeds Office. (e) The undertaking may only be revoked by the attorney if SARS is informed in writing that: o The vendor is under sequestration or liquidation on/after the date the undertaking is signed, and on/before five working days from the date of registration in the deeds registry office; or o The proceeds in respect of that property transaction in the hands of the attorney is attached by court order; or o The transaction is no longer proceeded with by the attorney, in which case the original Exemption certificate must be returned to SARS.

8 (f) Where an undertaking is provided, the Transfer duty Exemption certificate must be issued without delay. SARS may proceed with the separate recovery process referred to above without impeding on the issuing of the Transfer duty Exemption certificate. Sincerely, ISSUED ON BEHALF OF THE COMMISSIONER FOR THE SOUTH AFRICAN REVENUE SERVICE. Versions: Time Stamp: 2010-08-04 Form ID: LetTDExm Page of Page: 02/02. Value- Added Tax (VAT) TD-VAT. (in respect of Transfer of Property in terms of Section 9(15)(b) of the Transfer Duty Act No. 40 of 1949). Details Registered VAT reg No. vendor name Representative VAT. vendor name amount R. , Representative vendor ID no. Description I, the undersigned, as representative vendor of the aforementioned VAT Vendor, do hereby instruct and authorise my above-named attorney to furnish an undertaking to the Unit no.

9 Complex (if South African Revenue Service ( SARS ) for the payment of the abovementioned VAT. applicable) amount and to pay such VAT. I hereby indemnify the said attorney and undertake to reimburse him for the payment made on my behalf. Street no. Street / Name of Farm Signature Suburb /. District For enquiries go to Postal Date or City / Town (CCYYMMDD) call 0800 00 SARS (7277). code Details Full name ID No. Firm name Tel No. Email address Attorney's Address Unit no. Complex (if applicable) I, the undersigned as duly authorised representative of the above-named firm of attorneys do hereby warrant that I am a practising attorney and undertake to pay SARS the Street no. Street / Name abovementioned VAT amount as per the attached TD5 declaration against registration of of Farm Transfer of the abovementioned property, within 5 working days after registration in the Suburb / deeds office.

10 District This undertaking may be revoked if SARS is immediately notified in writing under the following circumstances: Postal - The Vendor is placed under sequestration/liquidation on or after date of signature of City / Town code this undertaking AND on or before 5 working days from date of registration in the deeds office;. Attorney's Address - The proceeds in respect of the aforementioned property in the hands of the attorney is attached by court order;. Mark here with an X if - The transaction is no longer proceeded with by the above-named attorney, in which case the original Exemption certificate must be returned to SARS. same as above or complete your Postal Address Signature For enquiries go to Date or (CCYYMMDD) call 0800 00 SARS (7277).


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