A South African Beneficial Owner’s Perspective

1. Major headwinds in the international offshore sector have been prevalent during 2018. CRS reporting starts on 31 August 2018 in Mauritius, and will be an open invitation for the South African Revenue Services to investigate and challenge Mauritian structures. In addition the Multi-Lateral Initiative (“MLI”) which has been signed by hundreds of countries (including Mauritius) should have the effect of limiting the application of Double Taxation Agreements by preventing foreigners from using Mauritius strictly for the purposes of “tax treaty shopping”. Then the Mauritian Legislature in mid-August 2018 passed the Finance (Miscellaneous Provisions) Bill (No 11 of 2018) into law which substantially changes and in many respects in its current form severely curtails the extent to which foreigners will be attracted to using Mauritius as a location for tax planning purposes. For Mauritian structures with South African tax resident beneficial owners, the environment has been further challenged with significant revisions to the South African Income Tax Act during 2018.

2. Given the above landscape Korten Consulting Ltd (“KCL”) is offering a most topical tax focused seminar that will identify and discuss the following-

Analysing the effect of the changes introduced by the Mauritian Finance Act 2018, with specific reference to Mauritian entities that have South Africa tax resident beneficial owners. Here, the enquiry will be to identify what tax benefits Mauritius still has to offer to South African tax residents;

An explanation of the most relevant 2018 changes to the South African Income Tax Act. The seminar will explain exactly how these revisions will negatively affect the tax position of the South African beneficial owners of most standard Mauritian based structures, particularly concerning Mauritian companies held by trusts, as well as estate planning structures involving loans by settlors to Mauritian trusts and foundations.

Identifying the future key tax risk areas. The presenter will not only identify and explain these tax risks areas, but will also propose potential solutions. Again, the case study to illustrate these risks will be that of the South African tax resident beneficial owner, where tax risks areas to be discussed will include-

  • The “Place of Effective Management” of Mauritian trusts and GBC’s, and related “residency” risks
  •  Transfer Pricing Rules and the necessity for substance and activity to takes place within Mauritius
  • Local Tax Anti-Avoidance rules, the effect of MLI and the fundamental importance of a commercial motivation, proper substance and avoiding artificial or abnormal arrangements
  •  South African Exchange Control Regulations

3. This seminar will be presented by Mark Korten who is the Managing Director of Korten Consulting Ltd. Mark is qualified South African attorney specializing in commercial and international tax matters. He has over 23 years professional experience dealing with offshore jurisdictions from a South African and general African perspective, and has been using Mauritius as an offshore services location for clients of KCL since 1997, as well as using numerous other offshore jurisdictions. Mark has advised various management companies, banks, lawyers, financial and investment advisors worldwide on diverse legal and tax issues for their clients with profiles ranging from corporates, private enterprises, wealthy families, entrepreneurs and high net worth individuals, with a specific emphasis on tax risk management, cross border tax planning, asset protection and wealth preservation. Mark Korten has also been a guest lecturer for various international tax courses and diplomas, including the International Tax LLM degree offered by the Thomas Jefferson School of Law at the University of San Diego, California in the USA.

4. Please note that the material to be presented at this seminar will only appeal to and be suitable for participants at a relatively high level of understanding of international tax concepts, the Mauritian legal and tax framework, and accordingly would appeal best to experienced legal advisors, financial planners, wealth managers, professional directors and executives within management companies who have South African clients. The seminar will be somewhat technical, but illustrated for practical application. It is designed to assist professional advisors and business development executives in recognizing and appreciating the increasing complexities imposed by high tax paying jurisdictions such as South Africa, which directly impacts on the correct way of establishing as well as executing Mauritian based structures. The objective of the seminar will be to illustrate that many existing Mauritian based structures involving South African beneficial owners will likely require substantial revision, both in the legal form as well as the SUBSTANCE attached to the operation thereof. The seminar will illustrate that Mauritian management companies in particular may need to re-examine the nature and basis upon which their services are rendered in order to maintain the tax compliance of their clients.

Details of the Seminar

Date: 15th November 2018

Time: 08.30 to 13.00, followed by lunch

Venue: Labourdonnais Hotel, Caudan Waterfront, Le Sirius Conference Room

Participation Fee

Participation fee for this seminar is Rs 5,500 per participant, inclusive of lunch.

Members of ATMC will be eligible for a special fee of Rs 4,500.

Please note that the seminar is not registered with MQA.

Booking for the Seminar

5. Please note that as the venue has a maximum capacity of 60 participants bookings may only be secured on payment in full and on a first come-first serve basis. Unless space is available, a maximum of 2 participants per organization will apply.

6. Registration should reach us by latest by midday 31 October 2018. Please click here to complete and submit the online registration form.