Page 13 - P6 Slide Taxation - Lecture Day 7 - Various Topics
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Proviso to par (c) of the definition of “Severance Benefit”
Even though the requirement of sub-paragraph (c) is met, the amount
received by the employee will not qualify as a severance benefit, if:
- Employer = Co or a CC, and
- Employee held > 5% of Co’s issued shares or CC’s member’s interest.
• Are there any deductions available?
→ No, because the “gross” amount is included in gross income.
→ The Second Schedule is not applicable to par (d) inclusions.
Calculate the tax ito “Table C” for non-Severance benefits.
Tax on a Severance benefit?
- Tax in terms of TableA less Tax on Hypothetical amount.
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