My dad (not South African, and resident in Zimbabwe) receives a modest retainer from a South African company that he sells product for in Zimbabwe. He decided that he wanted the retainer to be sent to me, so it goes into my bank account monthly. (Please note, I'm not an employee of that company). How does that work for my personal tax? Do I declare it, and if so, what as?
This would be classified as a donation. Donations above R100,000 per annum are taxed at 20% in the hands of the donor. However, this does not apply to donations from non-SA residents to SA residents (these are tax-free) as long as they are not from a SA source. How much per month is the retainer?
You would need to include it as a donation within the section "Amounts not considered taxable" and it will not attract tax.
Cathysays: 27 October 2015 at 13:32
The retainer is R7500, which comes to R90 000. Does the fact that it is paid into my account make it "from an SA source"? Or because it is technically my father's does it still count as "not an SA source"?
TaxTimsays: 27 October 2015 at 14:47
The fact that it is from a South Africa company may potentially make it from a South African source. However, it falls under the R100,000 threshhold and therefore wouldn't attract donations tax (provided your father doesn't make similar donations to others)
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