Acts Online
GT Shield

Income Tax Act, 1962 (Act 58 of 1962)

Chapter II: The Taxes

Part VIII : Dividends Tax

64H. Withholding of tax by intermediaries

 

 

(1) Subject to subsections (2) and (3), a regulated intermediary that pays a dividend that was declared by any other person must withhold an amount of dividends tax from that payment calculated as contemplated in section 64E except to the extent that—
(a) the dividend consists of a distribution of an asset in specie; or
(b) the dividend is not subject to the dividends tax by virtue of any STC credit contemplated in section 64J having been applied.

 

(2) A regulated intermediary must not withhold any dividends tax from the payment of a dividend contemplated in subsection (1) if—

(a)        the person to whom the payment is made has—

(i) by a date determined by the regulated intermediary; or
(ii) if the regulated intermediary did not determine a date as contemplated in subparagraph (i), by the date of payment of the dividend,

submitted to the regulated intermediary-

(aa) a declaration by the beneficial owner in such form as may be prescribed by the Commissioner that the dividend is exempt from the dividends tax in terms of section 64F or that the payment is made to a vesting trust of which the sole beneficiary is another regulated intermediary; and
(bb) a written undertaking in such form as may be prescribed by the Commissioner to forthwith inform the regulated intermediary in writing should the beneficial owner cease to be the circumstances affecting the exemption applicable to the beneficial owner in item (aa) change or the beneficial owner; or

(b)        the payment is made to another regulated intermediary.

 

(3) A regulated intermediary must withhold dividends tax from the payment of a dividend contemplated in subsection (1) at a reduced rate if the person to whom the payment is made has—
(a) by a date determined by the regulated intermediary; or
(b) if the regulated intermediary did not determine a date as contemplated in paragraph (a), by the date of payment of the dividend,

submitted to the regulated intermediary—

(i) a declaration by the beneficial owner in such form as may be prescribed by the Commissioner that the dividend is subject to that reduced rate as a result of the application of an agreement for the avoidance of double taxation; and
(ii) a written undertaking in such form as may be prescribed by the Commissioner to forthwith inform the regulated intermediary in writing should the circumstances affecting the reduced rate applicable to the beneficial owner referred to in subparagraph (i) change or the beneficial owner cease to be the beneficial owner.