Tax implications if married in community of property

Jun 29, 2023 | Uncategorised

28 June 2023 – SARS will identify taxpayers who are married in community of property and verify this information against the Department of Home Affairs.

We have developed the following FAQs for the Married in Community Spousal Assessment, also published on the Filing Season 2023 webpage:

What are the tax implications if I am married in community of property?

What does POPI act say about the communication around the ‘Married in Community Spousal Assessment’ ?

Where does the amounts found on my return come from?

What should I do if I am separated from my spouse?

What should I do if I am divorced from my spouse?

What should I do if I want to exclude my spouse from communal estate due to a legal contract?

Could this have a destabilising effect on families where the taxpayer is Married in Community of Property?

Will SARS inform the primary spouse?

Can the secondary spouse object to the ‘Married in Community Spousal Assessment’ ?

Where a match between SARS and Home Affairs is confirmed, the spouses will be linked as follows:

If investment income is identified for a taxpayer based on third party data received (e.g. IT3(b) certificate for interested earned), the third-party data will also be prepopulated on the spouse’s return if the spouses are linked on the SARS system.
The investment income will be apportioned accordingly and will reflect on the notice of assessment (ITA34) issued to each spouse, upon assessment.
Note: Where applicable, the spouse who is not registered for tax may be routed for Auto Registration.

Taxpayers married in community of property may opt to exclude certain income from the communal estate. In previous tax years, one communal estate indicator displayed per applicable container/subsection of the return and if the taxpayer selected the indicator it applied to the whole income amount declared in that part of the return (e.g. total local interest or total foreign dividends)

From the 2023 year of assessment, the taxpayer can select the communal estate indicator on a transactional level (i.e. for each institution from which the income was received). This change applies to the following containers/subsections of the return:

Local interest
Foreign interest
Foreign tax credits on foreign interest
Gross foreign dividends subject to SA normal tax
Foreign tax credits on foreign dividends
Distributions from a Real Estate Investment Trusts (REIT) /Taxable Local Dividends
Capital Gain/Loss
Local Rental Income

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