Abstract
M.Com.
Tax avoidance is a burning issue in the tax environment and increasing attention has been drawn to it by the South African Revenue Service and the public. Different people have their own perspective of what tax avoidance actually is and why taxpayers feel the urge to ‘legally’ reduce the taxes payable to the government of South Africa by entering into avoidance arrangements. The purpose of this limited scope dissertation is to review the causes of tax avoidance by analysing case law and to discuss the substance over form doctrine to establish whether there is an overlap in the application of the two.
The study includes an overview of the repealed tax avoidance legislation and a comparison to the new legislative provisions as well as an examination of the substance over form doctrine applied in case law. In discussing legislative provisions, this dissertation reviews the various applicable sections in the Income Tax Act No. 58 of 1962, as amended from time to time, taking into account leading cases based on the previous tax avoidance legislative provisions.
Finally, this limited scope dissertation also includes a general discussion of the Anti-avoidance Rules in two jurisdictions and the application of the substance over form doctrine in those jurisdictions, including an introduction to the commonly used term known as ‘sham’ (simulated transaction).