Has SARS exempted BCs and HOAs from income tax in South Africa?

Has SARS exempted BCs and HOAs from income tax in South Africa?

In South Africa, Bodies Corporate (BCs) and Homeowners Associations (HOAs) may be eligible for income tax exemption if they meet certain criteria. However, not all BCs and HOAs are automatically exempt from income tax.

The South African Revenue Service (SARS) requires each BC and HOA to apply for tax exemption and provide evidence that they meet the necessary criteria. The criteria may include, but are not limited to:

The BC or HOA must have been incorporated and registered with the Companies and Intellectual Property Commission (CIPC).

The BC or HOA must have a public benefit objective.

The BC or HOA must use any funds or assets solely for the benefit of the public.

The BC or HOA must not distribute any of its funds or assets to its members, directors or officers except as reasonable compensation for services rendered.

If the BC or HOA meets these criteria, they can apply to SARS for a tax exemption certificate. If granted, the BC or HOA will not be liable for income tax on any taxable income that is generated from carrying out their public benefit objective.