Tax and SARS knowledge base
Preparing ITR14 evidence for cross-border company transactions
How should a company prepare ITR14 evidence for cross-border transactions?
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Direct answer
There is no safe one-line list of cross-border entries for every company. The ITR14 is customised by the company's answers, and SARS says the return is used to declare the company's full income-tax responsibility and financial transactions for the relevant year. Prepare a complete evidence register for foreign or cross-border transactions, then answer the current ITR14 questions from verified records.
This article is a preparation workflow, not advice on the tax treatment of a particular transaction. If the company identifies a cross-border item it cannot classify from the current return and its records, it should obtain tailored tax advice before submission.
What this means in practice
The accounting description may not be enough. A ledger label such as "foreign consulting" may cover different transactions, counterparties or periods. The first task is to identify the underlying contract, invoice, payment or receipt and the reason it was recorded. That makes the tax-return working papers complete and reviewable.
Start with a register rather than trying to answer ITR14 questions from memory. Record the counterparty, country, relationship, contract, amount, currency, accounting treatment, payment date, tax withheld, invoice, bank reference and expected SARS treatment. Reconcile the register to the trial balance and financial statements. This avoids incomplete return answers.
An ITR14 return is not a substitute for reviewing underlying tax obligations. A company should not conclude that a payment is exempt from South African tax or withholding simply because the recipient is outside South Africa.
Step-by-step
- Identify all relevant transactions.
Extract foreign-currency transactions, non-resident customers and suppliers, offshore bank accounts, foreign investments, intercompany balances, royalties, interest, dividends and service fees for the year.
- Build a supporting register.
Capture the contracting party, beneficial recipient where relevant, country, payment or receipt amount, description, contract, invoice and any foreign tax withheld. Flag related-party and large transactions for review.
- Reconcile to the accounts.
Match the register to revenue, expense, asset, liability and tax accounts. Investigate differences between the bank, ledger and financial statements before preparing the tax computation.
- Check the current ITR14 questions.
Use the current SARS guide and eFiling form. The answers may customise further sections or schedules. Do not copy last year's answers where facts or the return design have changed.
- Obtain targeted specialist input.
Ask for review when the company cannot determine how a transaction should be treated for the return. Keep any advice and calculations with the return file.
- File and retain the evidence.
Submit only after the ITR14, tax computation and supporting schedules agree. Keep contracts, calculations, foreign tax certificates, proofs of payment and the filed return.
Documents and records to keep
Keep contracts, invoices, bank advices, foreign tax certificates, payment approvals, exchange-rate calculations, group structure charts, related-party schedules, tax computation and correspondence. Retain advice received on material international issues, including the facts supplied to the adviser.
Important limits and exceptions
Cross-border tax is highly fact-specific. The ITR14 workflow should not be used to infer a tax result from a country name, ledger label or payment method. Work from the actual transaction documents and the current SARS return questions.
This guide addresses preparation and disclosure discipline, not a conclusion on tax due. Use the SARS form and guidance current for the return year.
When to get tailored advice
Get advice before filing if material cross-border transactions are incomplete, unclear or inconsistent with the tax computation. Seek prompt support if a return has already been filed without a material transaction.
TaxProof can help assemble a cross-border evidence register. We cannot provide international tax conclusions without full facts.