Do any exemptions apply to Donations Tax?

Donors as individuals

Under section 56(2) of the Income Tax Act, 1962, donations tax is not payable in respect of the sum of the value of all property disposed of under donations, by a donor who is a natural person, if the sum of those donations does not exceed R100 000 during any year of assessment.  This limit came into operation on 1 March 2007 and applies to any year of assessment commencing on or after that date.

Donors other than individuals

For juristic persons such as private companies and trusts, the exemption is limited to R10 000 per year of assessment in respect of casual gifts.  However, if a year of assessment is less than 12 months, or exceeds 12 months, the exemption amount of R10 000 must be adjusted proportionately. Public companies are exempt from donations tax under section 56(1)(n).

Donations to public benefit organisations (PBOs)

These donations are exempt from donations tax under section 56(1)(h).

Donations between spouses

Donations between spouses are exempt from donations tax under section 56(1)(b).  When two people are married in community of property and property is  donated by one of the spouses, that donation is deemed to have been made in equal shares if that property falls within the joint estate of the spouses.  If that property was excluded from the joint estate of the spouses, that donation is treated as having been made solely by the spouse making the donation (section 57A).




Last Updated: 29/11/2017 3:40 PM     print this page
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