Inkomstebelastinghantering van klientelojaliteitsprogram-transaksies in Suid-Afrika

Brink, Sophia M. ; Viviers, Herman A. (2012-10)

CITATION: Brink, S. M. & Viviers, H. A. 2012. Inkomstebelastinghantering van kliëntelojaliteitsprogram-transaksies in Suid-Afrika. Journal of Economic and Financial Sciences, 5(2):437-458.

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Client loyalty programmes are a common phenomenon in the South African market and, although prevalent in South Africa since the 1980s, the South African Revenue Service has issued no guidance on the income tax treatment of client loyalty programme transactions in the hands of the consumer. Benefits received in the form of goods, services or discounts from a client loyalty programme are currently not subject to normal South African income tax. The main objective of the research was to investigate whether the existing provisions in the Income Tax Act and related case law provide the basis for taxing client loyalty programmes in the hands of the consumer as natural person. In order to meet this objective local and international literature was analysed to determine the correct income tax treatment and it was found that points or miles received by a consumer meet all the requirements of the “gross income” definition and as a result should be taxable.

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