Still no respect for Knysna Lagoon – the most unique in SA, rated Number One in SA for Scientific Importance

The above was written in response to the article below:

CXPRESS 26 August 2020

Still no respect for Knysna Lagoon – the most unique in SA
I retired to Knysna 12 years ago but have been coming here before that for over 50 years. I have been secretary of the Leisure Isle Boat Club and produced and managed its comprehensive website www.libcknysna.co.za.
I have a boat and spend much time on the lagoon, both by day and night. I therefore feel experienced to speak to your readers about the issues below.
Knysna Lagoon is managed by SANParks. In their management plan signed by the minister of Water Affairs and their Garden Route manager, it specifically calls for ‘Stakeholder Involvement’. Without it, according to Section 3.4.6 on p28, it risks:
• An increase in external impacts such as pollution and poaching (without question this is a fact that would be acknowledged by everyone);
• Less support from powerful stakeholders that can lead to a decrease in business revenue (many lagoon users are not applying for boating, baiting and fishing licences as they see little input from SANParks, and very few fines).
So, in a nutshell, there is a negative, downward spiral. I have on many occasions tackled SANParks on this, by asking them what the fines are for speeding in a non-wake zone, or skiing in a no-ski area, or for selling illegally caught bait, for using over sized nets, for selling your catch, for pollution, etc.
There is no answer because no one has been fined for these offences. I am told that they have ceased training of their officers, but cannot verify this latter point.
So come to Knysna, folks, and once on our lagoon, you can do any speed and ski anywhere.
Buy as much bait as you want and you can use long lines with as many hooks as you like. There are no restrictions here. Take a good gamble on even having a boat licence and collect all the bait you like anywhere in our lagoon at night, because there are no night patrols.
By the way, most of our regulations have not been updated since 1987, despite a huge increase in population and number of boats. Thesen’s alone added 300 craft.
About five years ago I started working with SANParks and other lagoon users. I felt the only way to make a difference was to increase awareness and knowledge of the lagoon, since many users did not have the benefit of hindsight, i.e. just how productive, quiet and beautiful this lagoon used to be.
So I came up with a Voluntary Code of Conduct which I presented to about 18 different lagoon associations, comprising about 300 people. I had widespread acceptance, even by SANParks, but still need them to at least uphold our current and limited regulations.
Interestingly, Plett is controlled by Cape Nature and has passed a law limiting speed below the bridge to a no-wake 5.5 knots.
I have never moaned about subsistence fishermen and personally would prefer 50 of them to one high speed boat with two 300hp motors causing huge wakes and putting so much marine life through the mincing machine of their prop wash!
I also feel that the 18-million cubic metres coming through our Heads every tide does a good job of catering for pollution and we need to start with some easier ‘can do’ projects, to give people experiences of success.
I would really appreciate your assistance in helping to curb the degeneration of this precious resource, which is also a big tourist attraction and job creator.
Arland Read, Knysna
(Interested readers can email wosi@iafrica.com to obtain copies of Arland’s talk, copies of SANParks correspondence, petitions, etc. Also visit www.cxpress.co.za to read Arland’s letter ‘Distressing lack of Knysna Estuary maintenance mars return to fishing grounds’ on page 5 of the June 24 edition, and the response from SANParks on page 7 of the July 1 edition. – Eds.)

Debbie Tickle – Leaving South Africa for good?

Leaving South Africa for good? What does this mean from a tax perspective?

July 1, 2020 6 Minutes

The Lockdown period, for those who still have some income, has given time for reflection and the opportunity to make some firm decisions about the future. In a recent article it was reported that the number of enquiries from South Africans to a global emigration advisory company during this time showed a significant spike, as people looked seriously at their options elsewhere.

Whatever your reasons for choosing to embark upon the journey of deciding whether you stay in South Africa (SA) or leave, there are some important factors that you need to take into account and potentially investigate further.

The first is the tax implication of leaving SA for good. If you cease to be ‘ordinarily resident’ you will also cease to be tax resident on the day this takes place. You are ‘ordinarily resident’ in the place you consider to be your ‘real home’ ie the place you return to after going on a trip. Thus, if that place becomes somewhere other than SA, you will cease to be tax resident in SA as well.

This sounds like a fairly simple exercise but, aside from making the decision to leave, you will need to be able to demonstrate that you have left and will not permanently return through your ongoing actions. This is because the onus of proving the date you ceased to be resident to the SA Revenue Service (SARS) will sit with you.

It is difficult to leave South Africa right now (and equally difficult to set up somewhere else) due to the travel restrictions. However, it seems that people are taking this time to lay the foundations for such a move ie ensuring they will have the right to live permanently elsewhere (residence or citizenship rights) and setting up the infrastructure (a home; a job; schools for their children etc) in their chosen location, so that it will be ready for them when they are able to depart. Once this is all set up it arguably could be possible to cease to be ordinarily (and thus tax) resident even though a person is restricted from leaving South Africa for the time being (but beware the 91 day ‘time present’ issue- I’ll cover this below).

Ceasing to be tax resident comes with it the obligation to submit a tax return for the period up to the date before you leave (you can call up a special tax return on e-filing) or indicate the date you left on your next ordinary tax return. Either way, your tax year as a SA tax resident will end on the day before you leave and a new tax year, as a non-SA tax resident, will begin the next day.

The catch, however, is that you will be deemed to have sold all your assets on the day before you cease to be tax resident. This means that, on the tax return reflecting your date of ceasing to be tax resident, you will have to declare the market value of your worldwide assets on the previous day as well as their ‘base cost’ and, if there is a gain, pay capital gains tax (as an “exit tax”) on the difference between the two amounts. This applies for each of your assets, other than a few specified exceptions which include, for example, currency (although gold or platinum coins are not excluded) and fixed property in South Africa.

So, for example, if you have a share portfolio (local and/or offshore shares) which cost you, say, R2.5mn and it is worth R4mn on the day before you cease to be resident, you have a SA property (cost R1mn, market value R10mn) and also a property in the place you will be going to live (cost $500 000, market value $600 000), you will have to add 40% (the inclusion rate) of the gain in value of the shares and the offshore property to your other taxable income and pay tax on it.

Thus, for the shares the gain is R1.5mn and for the offshore property gain is R1.73mn ($100 000* R17.30 (assuming $1=R17.30)). If you have other income such that your marginal tax rate is 45% and you have already used up your CGT annual allowance due to other capital gains, the ‘exit tax’ payable will be R581 400 (40% of 1,5mn+R1,73mn) at 45% marginal tax rate).

Thus, before you finalise a decision to leave you need to understand what the cost of this “exit tax” will be and make sure you have sufficient money available to pay it.

If the values of your assets have dropped significantly with the current global economic situation the ‘exit tax’ could be much less than if you were to have ceased to be a SA tax resident either before the global lockdowns or if you leave it until later when things start to recover…perhaps a good reason to make the decision to leave now rather than later.

Going forward, as a non-tax resident, if you receive any income sourced in SA eg rental on the property, you will be taxed on that here, but you won’t be taxed on any of the income you earn (sourced) outside SA eg in your new country of residence. It is also important to be aware that, provided you don’t spend more than 183 days in SA during the 12 month period that interest is received or accrued on any personal bank accounts you still have here in SA, that interest will also not be taxable in SA after you cease to be resident.

So, what happens if you later sell the property in SA. Even non-tax residents must pay CGT on the capital gains made on SA fixed property disposals, so when you sell it CGT will have to be paid to the SA Revenue Service. By then, however, you will perhaps have no, or little, other taxable income here and, since you will pay the tax based on the sliding scale, it could be less than if you sell in the tax year before you leave. If the SA property was your home, in some circumstances you may also qualify for some or all of the R2mn primary residence exemption.

There are two other things that are important to note here:

Firstly, it will be very important that in the tax year after you cease to be ordinarily resident ie when you become non-resident, you don’t spend more that 91 days in SA. If you do, because the ‘time present’ test for residence relies on a person being in SA for more than 91 days in the current tax year (ie the tax year after you ceased to be resident) and each of the previous five tax years, as well as more than a total of 915 days in those same previous five years (which is likely for the time that you were resident) you will trigger this test. Unless a double tax treaty treats you as resident elsewhere you could be drawn back into the SA tax residence (worldwide tax) net and have to pay more CGT “exit tax” if you ‘cease’ again (which will require that you remain outside SA for 330 consecutive days).

Thus, the timing of your departure and time away after you leave is very important.

Secondly, ceasing to be tax resident is a completely separate test to exchange control (financial) emigration and relinquishing citizenship. Thus, you need not financially emigrate or give up your SA citizenship to cease to be tax resident. Obviously, going through either or both of these processes will strengthen your assertion that you have left SA for good, but they are not pre-requisites.

There are many considerations that need to be borne in mind if you are in the process of making a decision to leave SA for good or not – both practical and tax (eg what do the tax and legal (eg for the purposes of making a Will) regimes in your potential new home country look like? ). It is not a decision to make without being fully aware of these factors and you would be wise to make sure you fully understand all of these to make sure you don’t make any mistakes that could cost you more than you bargained for. The fact that the SA government will pluck some of your money away as you leave as an ‘exit tax’ is only the first of many.

Leaving South Africa for good? What does this mean from a tax perspective?

Post Brexit Uk data privacy guidelines – 16Oct2020

https://www.gov.uk/guidance/using-personal-data-in-your-business-or-other-organisation-after-the-transition-period?utm_source=0bf0babc-dbff-4e36-9135-05a06b57a7a9&utm_medium=email&utm_campaign=govuk-notifications&utm_content=weekly

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What action you need to take regarding data protection and data flows with the EU/EEA after the end of the transition period.

Published 16 October 2020
From:
Department for Digital, Culture, Media & Sport, Department for Business, Energy & Industrial Strategy, Office for Civil Society, and Information Commissioner’s Office
New rules for January 2021
The UK has left the EU, and the transition period after Brexit comes to an end this year.

This page tells you what you’ll need to do from 1 January 2021. It will be updated if anything changes.

Check what else you need to do during the transition period.

Contents
What personal data is
Looking ahead to 1 January 2021
Data protection and GDPR
What you need to know about the transition period, data flows and EU-based representatives
This information is for UK businesses and other organisations that:

receive and transfer personal data to/from organisations abroad, including the European Economic Area (EEA), which includes the EU
operate in the EEA
Further information can be found on the Information Commissioner’s Office’s (ICO) website. The ICO is the independent supervisory authority for data protection in the UK.

What personal data is
Personal data is any information that can be used to identify a living person, including names, delivery details, IP addresses, or HR data such as payroll details. Most organisations use personal data in their daily operations.

An example of this is a UK company that receives customer information from an EU company, such as names and addresses, to provide goods or services.

Looking ahead to 1 January 2021
Receiving personal data from the EU/EEA and already adequate third countries
From 1 January 2021, your organisation may need to have Standard Contractual Clauses (SCCs) in place with EU counterparts in order to legally receive personal data from the EU.

The EU’s data adequacy assessment of the UK is underway and we are confident that adequacy decisions can be concluded by the end of the transition period. This would allow for the free flow of personal data from the EU/EEA to the UK to continue without any further action by organisations.

However, if the EU has not made adequacy decisions in respect of the UK before the end of the transition period, you should act if you want to ensure you can continue to lawfully receive personal data from EU/EEA businesses (and other organisations) in the future.

In this scenario, organisations will be required to put in place alternative transfer mechanisms to ensure that data can continue to legally flow from the EU/EEA to the UK. For most organisations, the most relevant of these will be Standard Contractual Clauses (SCCs). The ICO also provides more detailed guidance on what actions might be necessary and an interactive tool that allows you to build SCCs.

In addition to this, 11 of the 12 third countries deemed adequate by the EU have currently informed us they will maintain unrestricted personal data flows with the UK. Further information can be found on the ICO’s website.

For personal data flows from the UK
There are currently no changes to the way you send personal data to the EU, EEA, Gibraltar and other countries deemed adequate by the EU. If this situation changes, we will update this page.

For international data transfers from the UK to other jurisdictions, further information can be found on the ICO’s website.

Personal data provisions in the Withdrawal Agreement
Organisations should also be aware that Article 71 of the Withdrawal Agreement contains provisions that apply EU data protection law (in its end of the transition period state) to certain ‘legacy’ personal data if the UK has not been granted full adequacy decisions by the end of the transition period. ‘Legacy data’ includes personal data of individuals outside the UK processed in the UK prior to the end of the transition period, or subsequently on the basis of the Withdrawal Agreement. Check the ICO’s website for further information.

Appointing EU-based representatives
Some UK data controllers and processors may also need to appoint EU-based representatives from 1st January 2021. Further information can be found on the ICO’s website, or you can call the ICO helpline on 0303 123 1113 for further information (open Monday – Friday).

Data protection and GDPR
To date, during the transition period, there has been no change to the UK’s data protection standards. EU data protection laws, including the General Data Protection Regulation (GDPR), have continued to apply throughout the transition period alongside the Data Protection Act 2018. The Information Commissioner remains the UK’s independent supervisory authority on data protection.

After the end of the transition period, GDPR will be retained in UK law and will continue to be read alongside the Data Protection Act 2018, with technical amendments to ensure it can function in UK law. The UK remains committed to high data protection standards.

What you need to know about the transition period, data flows and EU-based representatives
During the transition period, personal data is able to flow freely (subject to GDPR compliance), without additional restrictions, between the EU/EEA and the UK. There is also no requirement for UK data controllers or processors to appoint EU-based representatives for the duration of the transition period. UK organisations are also still able to send personal data legally from the UK to the EEA and 12 countries currently deemed adequate by the EU.

On 16 July 2020 the Court of Justice of the European Union (CJEU or ECJ) invalidated the EU-US Privacy Shield adequacy decision with immediate effect in the Schrems II case, meaning this framework can no longer be relied upon for personal data transfers to US businesses and organisations.

The judgment upheld that EU standard contractual clauses (SCCs) remain a valid tool for the international transfer of personal data but only where they (together with any additional measures) provide for “essentially equivalent” protection as in the EU.

During the transition period, EU data protection law applies to the UK, and the Schrems II judgment and EU adequacy decisions are therefore binding on transfers of data leaving the UK. Further information can be found on the ICO’s website.

Published 16 October 2020