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TaxTim says: 30 September 2014 at 16:19 Your mother in law would declare the interest as she is the one earning it, but if she is older than 65 then she has an interest free exemption of R34 500 for each tax year so perhaps it will not exceed that. Your wife would not be paying any tax. |
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Mark says: 30 September 2014 at 16:32 Thanks for your response but it's my wife who received the R250Kcash from her mother - so it's my wife who earns the interest which she declares, but I need to know if there are any other tax implications for either of them in the form of donations tax or other taxes. Thanks... |
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TaxTim says: 30 September 2014 at 20:43 If your mother in law lends out money then there is an interest charge on that loan which she will have to declare. Your wife will have to declare her interest if she invests it or puts in in a bank. The only other tax implication will be for your mother in law donates the amount and not loans it then the first R100 000 will be tax free and the remainder subject to 20% donations tax payable by her. |
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