TAX Dividends Tax
– A guide for Investors
of the dividend), but will be withheld from the dividend payment by a withholding agent (either the distributing company or a regulated intermediary).
The withholding agent will then pay the tax to SARS (on or before the end of the month following the month in which the dividend was paid to the beneficial owner).
If any of the withholding agents fails to withhold the required tax, recovery could still be made from the person who has the liability therefore, i.e. the recipient of the dividend.
Withholding agents who fail to withhold could be held personally liable under certain circumstances. Where a dividend in specie is distributed, a scenario similar to that under STC will apply as the company distributing the dividend retains the liability for the tax as well as the duty to pay to SARS.
Returns
Payment of STC and DT has to be accompanied by a return in the form prescribed by the Commissioner. A return must be submitted to SARS by each entity that is involved in the dividend distribution chain, accounting for the payment of dividends to beneficial owners (including any withholding of tax) and/or
the pass through of dividends to regulated intermediaries for further distribution (and withholding of tax where relevant).
The return summarises how the dividends were dealt with and whether any taxes were withheld (receipt/declaration of dividends vs. the distribution of the dividends received/ declared) and must be accompanied by supporting data underpinning the return. The supporting information and return can be submitted through various channels. The difference between dividends per share and dividend yield can be explained as follows: If share X pays trading at R100 pays out a dividend of R2 and 6 months later another dividend of R3.50.
#2 Share Code: #3 Share Code: #4 Share Code: Alliance Mining Corp Ltd ALM DY: 18.604651163 Hospitality Prop Fund B HPB
DY: 15.623342175 #5 Share Code:
Verimark Holdings Ltd VMK DY: 12.820512821 #6 Share Code: Telemaster Holdings Ltd TLM DY: 11.382113821 #7 Share Code: page 16 Hospitality Prop Fund A HPA DY: 9.43011583
Beatthemarket.co.za | March 2012 Top 1PLA New Africa Invest Ld Ord NAI DY: 58.666666667 #1 Share Code: New Africa Investmnt-n- NAN DY: 58.666666667
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