[Question] How to declare REIT Dividends on Efiling ?

[Kindread]

Hi.

This is the first time I have to fill in my efilings after starting a trading account. I don't have any capital gains or loses to declare, but I'm not sure how I fill in the income from REIT dividends ? Can anyone explain it to me, please ?

[dellatjie]

As per the guide on the website, you have to choose the part on the front page referring to other taxable income, then declare it under code 4214.

[Kindread]

Thanks for the response.

I went to Sars yesterday however, and at first they didn't know what I was talking about when I mentioned REITs, but eventually I was sent to a consultant who added it to the interest earned amount ( which means its subject to the interest cap ). I see on my trading report the REIT dividend amount is also listed as interest.

[dellatjie]

These consultants gave you the wrong advice...

[Kindread]

Sigh. Sometimes I think SARS purposely create situations they can charge you penalties for later... Do you think I should go back to the SARS office ?

[CLIVE-TRIANGLE]

Sigh. Sometimes I think SARS purposely create situations they can charge you penalties for later... Do you think I should go back to the SARS office ?

I wouldn't bother. Here is more information on how to deal with it:

http://www.kpmg.com/za/en/issuesandinsights/articlespublications/tax-and-legal-publications/pages/changes-to-itr14-and-itr12.aspx

[CLIVE-TRIANGLE]

Kindread, I received this advise in an email from the developers of Wintax:

SARS have gone to a lot of trouble explaining everything about code 4238 REIT's income and how it is taxed as normal income etc but they have ommitted to include a specific place on the ITR12 for code 4238 REIT's income. Although WinTax has a place to enter code 4238 amounts, the ITR12 does not have place to enter code 4238 amounts. As an answer to many queries received lately regarding where to enter REIT's (Real Estate Investment Trust) income on the ITR12 we refer you to the following document released by SARS a few months ago.

If you received dividends distributed by a Real Estate Investment Trust (REIT), the amount will be reflected next to source code 4238 on the IT3(b) certificate issued to you by the REIT. On your ITR12 return, insert this amount next to source code 4214 and in the description field insert the description as “‘income from a REIT”.

Note that, if the taxpayer in married in Community of Property then you must only enter half the amount, shown on the IT3 as code 4238, under code 4214 on the ITR12 or under code 4238 in WinTax. Note that normal CoP rules apply here. If you are married in CoP and the legalities are that your REIT income belongs to you only and is not split with your spouse then you must enter the full amount of the REIT income even if married in CoP. WinTax will not automatically split your code 4238 amount entered and SARS will not automatically split your code 4214 amount for REIT income even if you indicate, on the Personal Details screen, that you are married in CoP.