Hide
Earn under R350,000? Click here to see why you still need to file to get your Tax Refund.
CLOSE
Get SARS Tax Dates and Deadlines in your Inbox
 

We'll tell you when you need to file, along with tax tips and updates.
Try Tim Now

Foreign Dividend Exemption - how does it work?

Posted 3 March 2014 under Tax Questions



Blog Categories


Ask TaxTim

Got a question you want answered about tax?

Visit our helpdesk →
What is the foreign dividend exemption for the 2012, 2013 and 2014 Tax years?

This entry was posted in Tax Questions and tagged , , . Bookmark the permalink.

TaxTimTaxTim says:
3 March 2014 at 21:15

What percentage of shares do you own and are they of a listed company?


Janneman says:
5 March 2014 at 11:09

The shares are all listed on the Australian stock exchange and the percentage that I hold is very very small.


TaxTimTaxTim says:
5 March 2014 at 22:22

If you hold less 10% of a listed share then the highest rate of tax will be 15% as a fraction of 25/40 is included in your taxable income.


Janneman says:
6 March 2014 at 15:16

Please explain " 15% as a fraction of 20/40 is included in your TI" Use an example of R24700 of diviodends.
Is this the rate for 2014?
If so what are the rates for 2012 and 2013


TaxTimTaxTim says:
7 March 2014 at 10:00

Assuming R24 700 is the foreign dividend received, you would multiply that by 25/40 which would give you R15 438.

Included Dividend:
24 700
less 15 438
equals 9 262 which is to be included in your taxable income.

It would depend on the marginal rate of tax as to how this is taxed. Therefore if you fall withing the 18% bracket then you would only be taxed at 18% of this amount which is an effective 7% tax. Assuming your marginal rate of tax is 40% then your effective tax would be 15%.


Get SARS Tax Dates and Deadlines in your Inbox
 

We'll tell you when you need to file, along with tax tips and updates.

Blog Categories


Ask TaxTim

Got a question you want answered about tax?

Visit our helpdesk →