Page 48 - Nexia SAB&T Trust Guide 2024

Other anti-avoidance provisions for trusts
Anti-avoidance provisions exist to combat the use of trusts for income splitting
and tax avoidance schemes. These provisions will normally be applicable where
income accrues to a person other than the donor as a result of a donation,
settlement or other disposition made (i.e. interest free loans). These provisions
may apply where income accrues to the following persons:
■ The donor’s spouse
■ A minor child of the donor
■ The trust to whom the donation, settlement or other disposition has been
made
■ Non-residents
The result of the anti-avoidance provisions are that the income that accrues to
the person’s mentioned above are deemed to be the income of the donor.
Withholding Tax on Acquisition of Property from Non-Resident
by a Trust
The purchaser (trust) must withhold CGT on the purchase price where immovable
property are purchased from a non-resident except where the amount payable by
the purchaser is less than R2 million. The amount withheld is an advance tax in
respect of the sellers’ liability for CGT. This withholding tax is not a final tax and is
merely a prepayment of the expected CGT.
The following withholding tax rates are applicable and are based on the proceeds
on disposal:
NON-RESIDENT SELLER 2023 2024 2025
Trust 15% 15% 15%

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