UNIVERSITY OF KWAZULU-NATAL

COLLEGE OF LAW & MANAGEMENT STUDIES

SCHOOL OF ACCOUNTING, ECONOMICS AND FINANCE

POSTGRADUATE DIPLOMA IN ACCOUNTING

ADVANCED TAXATION – 2023

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 UNIVERSITY OF KWAZULU-NATAL

SCHOOL OF ACCOUNTING

POSTGRADUATE DIPLOMA IN ACCOUNTING

ADVANCED TAXATION – COURSE

GUIDE: 2023

Aims

Objectives

Content

Textbooks

Taxation Section

Material

Approach

Lectures

Tutorials

Pre-Reading

Online learning

Queries

Assessment

DP Requirements

Open-book policy

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Aims

The main aim of this course is to provide a student with an understanding of taxation sufficient to enable that student to
not only to pass, but to score well in, the taxation questions included in the South African Institute of Chartered
Accountants’ Initial Test of Competence Exam (ITC).

The aim of the course is to provide a student with a base knowledge in tax. It is not the aim of this course to develop a
student to become a taxation expert. The course concerns itself with the development of entry level CAs and for that
reason specialist areas in taxation are not considered in the course.

A further aim of this course is to update student’s knowledge of taxation that has become necessitated by changes in the
legislation and case law.

The tax topics covered at an undergraduate level are considered to be assumed knowledge for the purposes of this course, and
therefore prepare a student to study tax at a post graduate level.

Objectives of the course

On completion of this course, a student should be able to calculate the

• normal tax,
• dividends tax,
• donations tax,
• estate duty,
• value-added tax,
• the normal tax on capital gains,
• transfer duty,
• securities transfer tax,
• withholding tax on interest, and
• withholding tax of amounts from payments to non-resident sellers of immovable property.

payable by
• natural persons,
• companies,
• close corporations,
• sole traders,
• non-residents,
• long-term contractors,
• shareholders,
• investors,
• industrialists,
• trusts and estates, and
• other classes of taxpayers,
and to minimise the taxation payable by these taxpayers if possible.

Content

The topics that will be covered during this course are as follows:
• The 2022 amendments.
• Value-added tax.
• Remuneration structures.
• Corporate rules.
• Lump-sum benefits from funds.
• Capital gains tax.
• Trading stock.
• Share-dealers vs investors.
• Buying assets vs shares.
• Taxation of dividends.
• Dividends tax.
• Trusts.
• Estate Duty and Donations Tax.
• Estate planning and deceased estates.
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• Insolvent estates.
• Tax avoidance.
• Hybrid debt instruments.
• Specific anti-avoidance provisions.
• Transfer pricing and thin capitalisation.
• Foreign exchange profits and losses.
• Capital allowances and recoupments.
• Lease vs buy.
• Deemed recoupments.
• Non-residents.
• ‘Foreign dividends’.
• Deemed interest incurred and accrued.
• Double Taxation Agreements.
• Prepaid expenditure.
• Withholding taxes applicable to transactions with non-residents
• Suspensive sale agreements.
• Future expenditure on contracts.
• Learnership agreements.
• Tax Administrative matters
• Investment decisions.
• Employees’ tax and personal service providers.
• Provisional tax.
• Case law.
• Business rescue.
• Other taxes related to sustainability.
• Incorporation of entities.
• Foreign branches and agencies.

As the updating of legislation covered in the course material takes account of only recent amendments a student who has not
studied taxation in the previous year will be expected to update himself for earlier amendments to the legislation.
It should be noted that the general principles of taxation that are covered in the undergraduate taxation course will not be
specifically dealt with in the advanced taxation course. These general principles are, however, constantly applied in the
completion of the course material and tutorial questions.
These modules may, however, be examinable in both the year end UKZN exams and SAICA’s Initial Test of Competence
Exam (ITC). A student is therefore required to revise his knowledge in these areas.

Textbooks

The following textbooks are prescribed and will be supplied on registration:

• SAICA Student Handbook (Tax Legislation)2022/ 2023
• Silke: South African Income Tax 2023, M. Stiglingh et al, LexisNexis
• A Student’s Guide to Advanced Tax 2023, A Brettany & A Singleton

The following textbooks are recommended:

• Notes on South African Income Tax 2023, Haupt, Hedron

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Taxation Section

Academic Leader: Ms Z Gumede

Module co-ordinators: Prof. S Pillay (Westville)
Lecturers: Prof. S Pillay (Westville) and Ms Z Gumede (PMB)
Secretary: Ms Patricia Ings
Tel: 031 260 1467; email: [email protected]

Material

The following course material is provided:

• Course outline.
• Weekly objective sheets.
• Suggested solutions to weekly self-study questions (tutorial and homework questions).
Please note that the solutions will be made available during the course of the year, either to be used as preparation
for the tutorial, or after the tutorial to be used to mark the unseen question attempt. Please check Learn on a regular
basis for new questions, revision packs or corrections to solutions.

Approach

The following comments are relevant to a student’s approach to this course:

• The course has been carefully structured.
• A detailed weekly study programme is presented.
• Approximately five hours must be spent each week completing the prescribed readings and tutorial questions. On average
three hours of tutorial questions are set each week.
• The prescribed readings must be completed before attempting the relevant tutorial questions.
• Suggested solutions to some tutorial questions are provided. They should be referred to in detail when assessing
performance. After the tutorial, you will be provided with the remaining solutions. Please use this mark plan to mark
your attempt to provide you with some feedback on your performance. Ideally form a study group and ask a member of
that group to mark your attempt.
• Additional questions as well as corrections to solutions will be posted on Learn on a periodic basis. Please check the
website regularly.
• Each week’s study journal should be completed with the relevant key points being listed.
• Queries should be solved timeously, not shortly before a test or an examination.

Lectures

Lectures will consist of various methods of online delivery. The lecture may have a video lecture or may consist of a live
lecture session or mainly consist of contact lectures delivered on campus on one day of the week. Please refer to Learn
notice for the details of the day, times and lecture venues or online invites. These may be subject to change due to University
requirements.

Tutorials

Tutorials will consist of a tutorial session on one day of the week, on or after the same day of the relevant lecture. Please refer
to Learn for the tutorial schedule of the questions to attempt, group allocation and times. These may be subject to change due
to University requirements. Refer to the Overall Student’s Guide for details on how attendance will affect your year mark.

Pre-Reading

Your time in lectures will be more effectively spent if you read the relevant chapter of your textbook (together with any
material provided on Learn) before attending the lecture. Please refer to your module notes for details regarding the
necessary pre-readings for each week.

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Blended learning
• Time management and routine study practices are essential for success in a blended learning environment.
• Take notes during lectures and organise these notes methodically.
• Note the dates and the duration of your on-line sessions, where applicable. Familiarise yourself with the related
administrative processes that you will need to complete for these sessions.
• Interact frequently to make the new way of learning feel normal – plan discussion sessions with peers and your lecturers and
don’t be afraid to ask for help.
• Most importantly, reward yourself when you achieve your set targets – it keeps you positive and motivated.
• If you are unable to meet the submission time for tutorial or assessment submissions, make sure to communicate with your
lecturer as soon as possible.

Queries

All administrative queries must be phoned or emailed to the administrator.

Queries regarding the course material should be addressed and resolved on a timeous basis during the course of the year.
For this purpose, please make note of the consultation times of your lecturers and their email addresses.

Assessment

Refer to the Overall Student’s Guide.

Tests

• Four tests are scheduled during the course of the year (refer to the Overall Student’s Guide).
• Each test contains one or more questions on advanced taxation of approximately two and a half hours duration in total
(excluding the online administration time). This may be subject to change. Any changes will be announced during the
year.
• A student’s year mark will be based on a combination of the average of that student’s three highest test results and tutorial
attendance (refer to the Overall Students Guide). This may be subject to change. Any changes will be announced during
the year.

Examinations

Refer to the Overall Student’s Guide.

DP Requirements

Refer to the Overall Student’s Guide.

Open book policy

The current SAICA Student Handbook Tax Legislation may be taken into the tests and the year-end and supplementary
Advanced Taxation examinations when a physical venue is utilised. Likewise, only the current SAICA Student Handbook
Tax Legislation may be used by a student for tests and for the year-end and supplementary Advanced Taxation
examinations if they are completed in an on-line environment.

Candidates are only allowed to highlight, underline, sideline and flag in the permitted texts. Writing on flags is permitted
for reference and cross-referencing purposes only, that is, writing may only refer to the name or number of the relevant
section in the legislation. All flagging of the book must comply with the flagging guidelines provided on Learn for this
module. Candidates may not have in their possession any loose papers, whether affixed to the permitted texts or
not. Only properly bound standard publishers’ editions are permissible. Photocopies, printed copies of
electronic versions, loose sections or isolated pages of texts are prohibited.

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 Postgraduate Diploma in Accounting

Advanced Taxation – 2023

The following suggestions have been taken from an article which appeared in ‘The Practical Accountant’ in
its July-August 1972 edition.
The language of the Income Tax Act, 1962, and other fiscal legislation is difficult to comprehend fully and the
following ‘ten pitfalls’ in interpreting fiscal legislation should be noted:
• Determine the limitations and exceptions to a provision. Do not permit the language of the provision to
carry greater or lesser weight than was intended.
• Just because a provision fails to mention an item does not necessarily mean that the item is excluded.
• Read definition clauses carefully.
• Do not overlook small words, like the word ‘and’ and the word ‘or’. There is a world of difference between
these two words.
• Read the provision completely and do not jump to conclusions prematurely.
• Watch out for cross-referenced and related provisions since many sections of an Act are interrelated.
• The legislature is at times not careful when reconciling new provisions with existing provisions. Conflicts
among provisions, therefore, do arise.
• Be alert for hidden definitions, terms in a particular section may be defined in the same section or in a
separate section.
• Some answers may not be found in the legislation, therefore, a researcher may have to consult the judicial
decisions on these issues.
• Take careful note of ‘measuring words’, like ‘less than 50%’, ‘more than 50%’, ‘at least 80%’ and ‘more
than 80%’.

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 POSTGRADUATE DIPLOMA IN ACCOUNTING

ADVANCED TAXATION – 2023

COURSE OUTLINE

Date Week Topic Examinable topics

30 January 2023 1 Introduction and Value-added tax (Vat)
06 February 2023 2 Value-added tax (Vat) (continued)
143February 2023 3 Corporate Rules
20 February 2023 4 Capital Allowances and leasing (including section 11(j)
27 February 2023 5 Capital gains (CGT)
06 March 2023 6 Capital gains (CGT)
13 March 2023 7 Dividends (including section 8F)
20 March 2023 8 Dividends Tax
27 March 2023 Test 1 Weeks 1 - 7
9 Trading stock, share-dealers vs investors; assets vs
03 April 2023 shares
10 April 2023 Easter Vac (7 - 16 April)
17 April 2023 10 Trusts
11 Trusts and CGT; and Interest (S24J and 7F now
24 April 2023 included)
01 May 2023 12 Foreign exchange gains and losses
08 May 2023 13 Estate Duty and Donations Tax Revision
15 May 2023 14 Taxation of Estates and Estate Planning
22 May 2023 Test 2 Weeks 1 – 13
29 May 2023 15 Remuneration structures
05 June 2023 16 Lump sum benefits from funds and employers
17 Employees tax and personal service providers/
12 June 2023 Provisional tax
18 Prepaid expenditure, suspensive sale debtors’
allowances, future expenditure on contracts and
18 June 2023 learnership allowances and Tax Administration.
26 June 2023 VACATION
03 July 2023 VACATION
19 Case law revision (Section 24O included in this
10 July 2023 lecture)
17 July 2023 Test 3 Weeks 1 – 18
24 July 2023 20 Non-residents and Foreign Dividends
01 August 2023 21 DTA
08 August 2023 22 DTA
14 August 2023 Test 4 Weeks 1 - 22
21 August 2023 23 Tax avoidance (Transfer pricing and thin capitalisation)
24 Competency Framework Aspects: Avoidance, Green
28 August 2023 Taxes, Bus Rescue

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Postgraduate Diploma in Accounting

Advanced Taxation – 2023

Module 1

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 Postgraduate Diploma in Accounting

Advanced Taxation – 2023

Module 1 – Lecture Guide

Contents

Included in Module 1 are the topics that could be examined in Test 1.

Topics

The topics that are covered in Module 1 are as follows:

Lecture 1: Value-Added Tax

Lecture 2: Value-Added Tax

Lecture 3: Corporate Rules

Lecture 4: Capital Allowances and leasing (including section 11(j)

Lecture 5: Capital Gains Tax (CGT)

Lecture 6: Capital Gains Tax (CGT)

Lecture 7: Dividends (including section 8F)

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