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Thread: Transfer of membership in a cc between spouses

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    Transfer of membership in a cc between spouses

    Hi,

    What are the implications (including tax implications) of transferring the membership in an operating cc from the husband to the wife? Would this transaction be completely exempt because of donations between spouses being exempt?

    Kindly advise. Thanks!

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    Im no tax expert however it will depend firstly on the marital contract the 2 are in.
    If COP then their estate is joint and I dont think there is any tax implication.

    However ANC with or without Accrual things get a bit trickier although Im fairly certain that without accrual is a situation when the 2 estates are seperate in law meaning the sale is treated the same as between 2 strangers - i.e. a tax liability could accrue to the seller.

    SARS should be able to give you guidance on the matter. Look them up and send them an email query.
    Good luck

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    Bronze Member Miro Bagrov's Avatar
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    The change of Ownership was simply filling in a CK2 Form... amendment in ownership. Handing it in to DTI;
    If you're not in Pretoria, I can hand it in for you directly to DTI: I think they wanted fifty bucks or something to process it..

    You forgot to mention the VIP: married in community of property or out of community.

    Good Luck.

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    I don't see the point if married ICP. So lets work on there being an ANC.

    My understanding is that spouses can donate as much as they want to each other, so a contract would be drawn up where the shares in the cc are sold for Rx to the wife. Because its not an arms length transaction (meaning the parties are related), you will have to arrive at a market value for the Rx amount and may not be able to simply use any value you choose.

    The husband will probably now make a capital gain on this sale, and if this is high enough he may have to pay some CGT.

    There will most probably be STT tax on the transaction which is a relatively small tax paid on the transfer of any securities, based on the value of the transaction.

    That said, I am not a tax expert and the above is from fairly recent experience, but may have been unique to my situation and not yours. It would really be worth your whils spending a short session with a tax consultant just to be sure.

    Non tax implications are that some paper work needs to be presented to CIPC to do the change in ownership and a written contract would be a good idea too.

    Others would depend on why you are doing this. For instance if its to avoid creditors, there may be certain time limits in which the transaction can be reversed by creditors.

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    Platinum Member sterne.law@gmail.com's Avatar
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    To follow on the creditors issue -

    In insolvency matters, such transactions are deemed as dispositions and are in a manner of speaking reversed as if they did not happen. [in an insolveny case the marriage system DOES now become a bigger factor, due to in community being a joint estate]
    Anthony Sterne

    www.acumenholdings.co.za
    DISCLAIMER The above is merely a comment in discussion form and an open public arena. It does not constitute a legal opinion or professional advice in any manner or form.

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    Email problem Missnancyalex's Avatar
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    I don’t know much about this but I did little research on this topic and find these resources may be at-least one of them will be helpful to you.
    http://sa-property.blogspot.com/2008...you-buyer.html
    http://www.sars.gov.za/home.asp?pid=8413
    http://www.law24.com/index.php?optio...eb/a6mfb/sf1rb
    http://www.northernlaw.co.za/

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    We changed shares of a PTY company in 2010 from the husband to his wife. I think that we just payed for the SST tax as Busfact has stated.The accountants worked out the value of the shares and the tax was payed on that value.

    As far as I am aware the CGT or Death duty is deferred to the wife and should she sell or die, the tax will then have to be payed.

    Don't quote me on this..

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    Site Caretaker Dave A's Avatar
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    Quote Originally Posted by roryf View Post
    As far as I am aware the CGT or Death duty is deferred to the wife and should she sell or die, the tax will then have to be payed.
    I was aware of this - but I'm not sure whether this applies only with asset transfers arising from the death of a spouse (which might not apply in the OP's case).
    The trouble with opportunity is it normally comes dressed up as work.

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    Quote Originally Posted by Dave A View Post
    I was aware of this - but I'm not sure whether this applies only with asset transfers arising from the death of a spouse (which might not apply in the OP's case).
    I'm pretty sure that is only in the case of death of the one spouse.

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  18. #10
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    Phew... There are a number of factors to consider here. Thank you so much to everyone that has replied!

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