BENEFICIAL OWNERSHIP DISCLOSURE IN THE ITR14

SARS has introduced mandatory beneficial ownership disclosure as part of the Corporate Income Tax Return (“ITR14”). Since 16 September 2024, all companies submitting income tax returns are required to use the enhanced ITR14, which includes detailed beneficial ownership reporting requirements.

This development aligns South Africa with international standards issued by the Financial Action Task Force (“FATF”) aimed at improving transparency and combating financial crimes such as money laundering and terrorist financing.

The new disclosure requirements are significant and companies should ensure that ownership and control structures are properly assessed before submitting their ITR14 returns.

What is SARS trying to achieve?

SARS requires companies to disclose the natural persons who directly or indirectly ultimately own or exercise effective control over the company.

Importantly, SARS has confirmed that the beneficial ownership disclosure required in the ITR14 is not necessarily the same as the disclosure required by the Companies and Intellectual Property Commission (“CIPC”). SARS’ approach is aimed primarily at supporting tax administration and South Africa’s FATF obligations and may therefore produce different outcomes from the CIPC process.

SARS has also acknowledged that identifying beneficial owners can be complex, particularly where ownership structures involve trusts, partnerships, layered entities, or indirect control arrangements. Nevertheless, companies remain legally obliged to make the required disclosures.

Who qualifies as a beneficial owner?

SARS clarified its approach in the updated guide titled How to complete the Income Tax Return ITR14 for Companies, published in April 2025.

The key consideration is whether an individual ultimately owns or exercises effective control over the company.

SARS specifically notes that:

  • merely holding a substantial beneficial interest in shares does not automatically make a person a beneficial owner;
  • the ability to materially influence management is not, on its own, decisive; and
  • the overall facts and extent of ultimate ownership or control must be considered.

In the case of listed companies, it is possible that no beneficial owner may exist for disclosure purposes. However, the company bears the responsibility of properly investigating and assessing this position.

Reasons for beneficial ownership reflected in the ITR14

The ITR14 requires taxpayers to indicate the reason why an individual qualifies as a beneficial owner. The available categories include:

  1. Holding a beneficial interest in the securities of the company.
  2. Exercising, or controlling the exercise of, voting rights associated with securities of the company.
  3. Exercising, or controlling the exercise of, the right to appoint or remove members of the board of directors of the company.
  4. Holding beneficial interests in, or exercising control through, a holding company of the company.
  5. Exercising control, directly or indirectly, through:
    • another juristic person;
    • a body of persons;
    • a partnership arrangement; or
    • a trust arrangement.
  6. Otherwise materially influencing the management of the company.

In complex structures, more than one category may apply.

What information must be disclosed?

The following information must be disclosed for each beneficial owner identified:

  • Full names and surname
  • Initials
  • Date of birth
  • South African ID number or passport details
  • Tax reference number
  • Confirmation of South African tax registration status
  • Email address

Companies should ensure that this information is accurate, complete, and supported by appropriate records.

Risks of non-compliance

Failure to disclose beneficial ownership information correctly and completely may expose both the company and its public officer to significant risk.

Section 234 of the Tax Administration Act 28 of 2011 (“TAA”) creates various criminal tax offences relating to non-compliance with tax obligations. Depending on the circumstances, non-compliance may result in substantial fines and, in serious cases, imprisonment.

In addition, incomplete or inaccurate disclosures may increase the likelihood of SARS queries, verification procedures, or broader compliance scrutiny.

Practical next steps for companies

Companies should consider taking the following steps before submitting their ITR14 returns:

  • Review ownership and control structures carefully;
  • Identify all individuals who may ultimately exercise ownership or effective control;
  • Verify that supporting information and records are complete and accurate; and
  • Assess whether existing CIPC beneficial ownership disclosures align with the SARS disclosure position.

Early review is particularly important where trusts, layered group structures, nominee arrangements, or indirect control mechanisms exist.

Conclusion

Beneficial ownership disclosure is now an important part of corporate tax compliance in South Africa and is likely to remain an area of increasing regulatory focus.

Companies should ensure that beneficial ownership information is properly identified, documented, and disclosed in the ITR14 to minimise compliance risk and avoid unnecessary scrutiny from SARS.

If you require assistance in assessing your beneficial ownership disclosure obligations or completing the ITR14 disclosure requirements, please contact the Nubis.tax team for assistance tailored to your specific circumstances.