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Die toedelingstelsel as alternatiewe belastingvoorstel vir kleinbesigheidskorporasies

Die toedelingstelsel as alternatiewe belastingvoorstel vir kleinbesigheidskorporasies The progressive importance of the small business sector to the facilitation of economic growth that is necessary for the creation of job opportunities in South Africa, cannot be overemphasised. The role which tax reform plays in the encouragement of the small business sector is of the utmost importance in providing an enabling environment. The purpose of this article is to address the less advantageous treatment of, especially, assessed losses in the corporate form as opposed to the non‐corporate form. In the course thereof an alternative tax proposal, based on the working of the S Corporation in the United States of America, is put forward, which could improve neutrality between the various enterprise forms. The tax treatment and functioning of the S Corporation is investigated to determine the applicability and practicality of such a treatment of assessed losses and profits for the corporate form in South Africa. Such an application is necessary because of the assumed influence that the treatment of assessed losses have in the choice of an enterprise form. This choice should, however, be based on economic considerations rather than on tax considerations. A neutral tax system should not influence people to choose one course of action above another mainly or solely because their position is more favourable under one of the options. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Meditari Accountancy Research Emerald Publishing

Die toedelingstelsel as alternatiewe belastingvoorstel vir kleinbesigheidskorporasies

Meditari Accountancy Research , Volume 8 (1): 17 – Apr 1, 2000

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Publisher
Emerald Publishing
Copyright
Copyright © 2000 MCB UP Ltd. All rights reserved.
ISSN
1022-2529
DOI
10.1108/10222529200000008
Publisher site
See Article on Publisher Site

Abstract

The progressive importance of the small business sector to the facilitation of economic growth that is necessary for the creation of job opportunities in South Africa, cannot be overemphasised. The role which tax reform plays in the encouragement of the small business sector is of the utmost importance in providing an enabling environment. The purpose of this article is to address the less advantageous treatment of, especially, assessed losses in the corporate form as opposed to the non‐corporate form. In the course thereof an alternative tax proposal, based on the working of the S Corporation in the United States of America, is put forward, which could improve neutrality between the various enterprise forms. The tax treatment and functioning of the S Corporation is investigated to determine the applicability and practicality of such a treatment of assessed losses and profits for the corporate form in South Africa. Such an application is necessary because of the assumed influence that the treatment of assessed losses have in the choice of an enterprise form. This choice should, however, be based on economic considerations rather than on tax considerations. A neutral tax system should not influence people to choose one course of action above another mainly or solely because their position is more favourable under one of the options.

Journal

Meditari Accountancy ResearchEmerald Publishing

Published: Apr 1, 2000

Keywords: Small business corporations; Assessed losses; S Corporation; Apportionment

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