Title page for ETD etd-03092012-112031

Document Type Master's Dissertation
Author Moodley, Theogaren
Email theo.moodley@gmail.com
URN etd-03092012-112031
Document Title A critical analysis of the tax deductibility of expenses incurred in virtual worlds by the South African taxpayer
Degree MCom
Department Taxation
Advisor Name Title
Prof H du Preez Supervisor
  • general deduction formula
  • virtuele węreldhandel
  • virtuele węrelde
  • virtuele inkomste
  • belastingaftrekkings
  • e-handel
  • algemene aftrekkingsformule
  • virtual world commerce
  • virtual worlds
  • virtual income
  • tax deductions
  • e-commerce
Date 2012-04-16
Availability unrestricted
The arrival of the Internet and the World Wide Web has had a radical impact on commerce and people’s ability to interact virtually. Through these channels various new methods of earning income have been created.

Income earned virtually creates a new type of commerce not previously envisioned whilst the South African Income Tax Act was drawn up. The revenue earned is, however. encompassed in the Act. South African residents have as a result entered the taxation net of the South African Revenue Services without understanding the full implications of being taxed. Of particular importance are the deductions available to residents whose incomes are earned through virtual worlds. The various deductions available in the South African Income Tax Act do not specifically deal with the expenses incurred in the production of virtual world income.

South Africans are thus exposed to taxation implications not fully explored by the South African Revenue Services nor the general public. The public needs guidance on this matter and the South African Revenue Services needs further research to be conducted in this area.

The study revealed that deductions would be allowed against taxable income earned through conducting virtual world commerce. The general deduction formula should be applied to all expenses. Capital expenses should be researched further, for application in terms of the Act. However, it appears that the Act can be applied to non- capital expenses incurred for trading in virtual worlds.

AFRIKAANS : Die aankoms van die Internet en die Węreldwye Web het reeds ‘n geweldige impak op die handle en mense se vermoëns om virtueel in wisselwerking te wees. Deur middle van hierdie kanale het verskeie nuwe metodes onstaan om ‘n inkomste te verdien.

‘n Inkomste wat virtueel verdien word, skep ‘n nuwe sort handle waarvoor daar geen voorsiening gemaak is toe die Inkomste Belastingswetgewing opgestel is. Die inkomste wat verdien word is wel binne die bestek van die Wetgewing. Suid-Afrikaanse inwoners val dus binne die belastingsnet van die Suid-Afrikaanse Inkomste Dienste sonder om die volle implikasies van die belasting te begryp. Van besondere belang is die belastingsaftrekkings wat vir inwoners, wie se inkomste in die virtuele węreld verdien word, beskikbaar is. Die verskeie aftrekkings beskikbaar in die Suid-Afrikaanse Inkomste Belastingswetgewing maak nie spesifiek voorsiening vir die uitgawes wat aangegaan word terwyl ‘n inkomste in die virtuele węreld verdien word nie.

Suid Afrikaners word duw aan belastingsgevolge blootgestel wat nie ten volle deur die Suid-Afrikaanse Inkomste Dienste, of die algemene publiek verken is nie. Die publiek het leiding in die opsig nodig en die Suid-Afrikaanse Inkomste Dienste benodig verdere navorsing in die verband.

Die studie toon dat aftrekkings toegelaat sou word teen belasbare inkomste wat verdien word, deur handel in die virtuele węreld te dryf. ‘n Algemene formule moet op alle uigawes toegepas word. Kapitale uitgawes moet verder nagevors word vir toepassing op die Wetgewing. Nieteenstaande, wil dit voorkom dat die Wetgewing op nie-kapitale uitgawes wat in die proses van handel dryf in die virtuele węreld, toegepas kan word.

Copyright 2011, University of Pretoria. All rights reserved. The copyright in this work vests in the University of Pretoria. No part of this work may be reproduced or transmitted in any form or by any means, without the prior written permission of the University of Pretoria.

Please cite as follows:

Moodley, T 2011, A critical analysis of the tax deductibility of expenses incurred in virtual worlds by the South African taxpayer, MCom dissertation, University of Pretoria, Pretoria, viewed yymmdd < http://upetd.up.ac.za/thesis/available/etd-03092012-112031 / >


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