While much has been written about the failures at the SA Revenue Service (Sars) over the last few years, the high quality of the country’s tax law is often overlooked. Many so-called developed countries have overly complex tax laws, while many developing countries rely on overly simple and old-fashioned tax systems that are open to exploitation. In SA our income tax legislation is comprehensive without being too complex or incapable of enforcement.

For example, much has been written about the tax evils of offshore trusts. However, in terms of SA tax law any offshore trust that is actually managed from SA will be taxed as an SA-resident taxpayer. In addition, any SA funder of an offshore trust, depending on how the trust is funded, will be potentially subject to donations tax as well as being taxed on the income or capital gains of the trust. Any distributions by the offshore trust to SA-resident beneficiaries may also be subject to SA tax...

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