You may know that certain persons are, per the Income Tax Act, required to deduct a 3% tax on payments made in respect of construction contracts. The 3% tax is a tax falling under a category of what is commonly referred to as Other-withholding taxes. A withholding tax (WHT) is a tax required to be deducted at source by the payer to the payee in respect of amounts arising from construction contracts.
Whilst the 3% tax is in most instances deductible by companies, NGOs and government departments, one question which is never clear is whether individuals who are not in business should also deduct the tax. This issue arises from the fact that the section of the Income Tax Act (hereinafter Act) requiring that the tax be deducted reads as follows, ‘Every person who makes any payment to any person under a contract relating to construction operations shall deduct tax from such payment.’ You see, the word ‘person’ includes even our 75 year old granny in the village who pays for construction contracts. So, I want to analyse whether individuals not in business should deduct the 3% tax. In this article, words importing the masculine shall be deemed to include the feminine.
WHAT’S THIS 3% TAX?
The 3% construction tax is imposed by the Act on payments made in respect of construction contracts which are at least P 5 000 in value. I highlighted above that the Act states that the tax shall be deducted by every ‘person’ which implies that there are no exceptions. I will get back to this matter further below. On another note, the Act does not define construction contracts but it is common cause that the term includes, among others, the construction of the following: houses, office complexes, bridges, dams, tarred roads and sewerage works.
The payer of the amount charged on construction contracts is mandated by the Act to deduct the tax and remit the amount so deducted to BURS no later than the 15th day of the month following that of payment of the contractor. Failure to remit the tax to BURS within the stipulated time exposes the payer to an annual effective interest rate of 19.56% or compounded 1.5% interest per month or part thereof. Further, non-deduction of the tax makes the payer personally liable for the tax. You certainly don’t want to find yourself in such a situation; believe you me.
INDIVIDUALS CAN’T WITHHOLD
Now, let me get back to the main issue of today’s discussion, being that individuals who are not in business should ideally not deduct the 3% WHT. This is my view and you are free to disagree with it. My view is based on the points below:
Hard-to-tax: Individuals who are not in business cannot deduct this tax because they belong to a group of taxpayers who are by default, sworn tax evaders.
This group is commonly called the Hard-to-Tax. By nature, individuals do not volunteer to pay tax as their personal interests take precedence over tax laws. The fact that individuals can’t voluntarily pay their taxes explains why BURS, just like all tax authorities worldwide requires employers to deduct PAYE at source. If that were not the case, BURS would surely lose out as the majority of individuals not in business simply do not comply with taxes. Now, if this group of taxpayers can’t pay their own taxes, do you think that BURS would get anything if they were to deduct the 3% tax from other persons? They would simply squander the tax and play catch-me-if-you-can with BURS. This would be a losing game for the taxman.
Impracticable: If individuals who are not in business were required to deduct the 3% tax, some of them could actually deduct the tax and then discover that there was no way of taking it to BURS. Practically, anyone who deducts such taxes should be registered for WHTs with BURS (i.e. have a WHT account). Most such persons should first be registered for income tax, implying that those who are not registered for tax would simply keep the tax at home and finally squander it.
If individuals not in business were to deduct the 3% tax, that would mean that every person in the country including those in the villages would need to register for WHT with BURS. Do you think that it would be practicable to require our aged mothers and fathers in the villages to register for tax, deduct the 3% tax and remit it to BURS?
That would simply be impossible. How many people on the streets, even those who are learned, understand that there is a section 57 and a Sixth Schedule in the Act which requires deduction of some 3% tax? Further, assuming that somehow tax knowledge was widespread such that everyone in towns and villages understood taxes, imagine how long the queues at BURS would be on the 15th of each month with individuals wanting to pay taxes. And also imagine how BURS would be inundated with cases of individuals who would deduct tax and never give the payee proof of payment of the tax in the form of withholding tax certificates (ITW 9s).
Exemptions for individuals: Whilst there is no specific exemption for payments made in respect of construction contracts by individuals not in business, other WHTs provisions such as on rent simply state that only businesses should deduct the tax. In other words, individuals not in business can’t be given a liability to collect state funds. So, the exact reasons that the legislature had in mind when he prescribed that tax on rent shouldn’t be deducted by such individuals should apply to those individuals deducting the 3% WHT. There is no difference between the principle of these two taxes; so technically, they should be applied uniformly.
Contra-fiscum principle: The contra-fiscum principle prescribes that where there is anything unclear in a taxing Act, the courts rule in favour of taxpayers. So, as stated above, there is no exemption on individuals not in business but again it is impracticable for them to deduct the tax and it is in such cases where the contra-fiscum principle applies. Effectively, if such matters were to be laid before the courts, the taxpayers would win, i.e. they can’t be obligated to deduct tax, for the reasons stated above.
Well folks, I hope that was insightful. As Yours Truly says goodbye, remember to pay to Caesar what belongs to him. If you want to join our Tax Whatsapp group, send me a text on the cell number below. Jonathan Hore is the Managing Tax Consultant of Aupracon Tax Specialists and feedback can be relayed to email@example.com or 7181 5836. This article is of a general nature and is not meant to address particular matters of any person.
We have come a long way from the 19th century, when mental un-healthiness was not recognised as treatable. In those days mental health problems were viewed as a sign of madness, warranting imprisonment in often merciless and unhygienic conditions; and with that backdrop you would think twice before calling in sick because of stress or admit feelings of hopelessness or depression but thatâs changing. That may sound like good news but itâs not.
Reasons why employees donât show up for work can vary, but one thing is for certain; an organisation relies on its staff to get things done and when employees donât show up for work it disrupts organisational plans, takes up the valuable time from management and lowers the companyâs productivity.Â Itâs always been that people miss work for several reasons, some understandable and legitimate and others less so but itâs important that we know the reasons so that such situations can be better managed.
Today stress is one of the most common causes of long-term absence and is especially prevalent amongst office-based staff.Â This is also related to absence due to depression or anxiety. Is this indicative of where we are as a society, a sign of the times which is that people are constantly pressurised and have less work-life balance?
The British Museum houses a tablet which provides a peek into work-life balance in ancient Egypt. It documents how many sick days and why 40 workers took time off from their workplace in 1250 BC. All sorts of fascinating reasons have been given for why people were away from their work, including a note about someone named Buqentuf, who needed time off for embalming and wrapping the corpse of his dead mother.
There were other reasons like some workers, such as a man named Pennub, missed work because their mothers were ill. Â Others had causes that we wouldnât expect to hear as often today, such as men who stayed home to help around the house due to a âwife or daughter bleedingâ – a reference to menstruation. But no mention of mental health, not because it didnât exist, but it wasnât labelled thus not reported.
What was reported was a person such as Aapehti who was said to have been ill on a regular basis and also took time off when he was âmaking offerings to godâ. Â Workers also took days off when they had to perform tasks for their superiors â which was apparently permitted in moderate amounts. For example, Amenmose was allowed time away from work when he was âfetching stones for the scribe: Â And what about other employees who had to excuse themselves from work to brew beer, an activity which was associated with some of their gods and rituals.
All fascinating stuff which provides insight into life at that time. But what insights can we gather from todayâs sick leave records? One study recently undertaken gives us insight into the UK police forceâs absenteeism. Figures obtained through the Freedom of Information Act from police forces in the UK showed that the number of days absent due to mental health problems increased by 9% in one year, from 457,154 in 2020 to 497,154 in 2021.
And here is the shocker. PoliceÂ have taken a record 500,000 days off due to mental health issues. Zoe Billingham, a former police inspector, suggested there was a greater prevalence of mental health issues among emergency services, due to what they faced during the pandemic of coronavirus. âPolice and other frontline services have protected us during the pandemic,â she said. âThe pandemic was a great unknown. People were really scared of dying and coming into contact with the virus, and a lot of people did.â
It is a âmental health epidemicâ among police. Alistair Carmichael, Home Affairs spokesman for the Liberal Democrats, said: âFrontline police officers do an incredible job serving their communities. But we know that the stress of policing can take a heavy toll on the mental health of officers, in some cases leading to burnout.
Letâs look at another group. A poll by Gallup reported that in the last three years, 75% of young adults aged 18â22 have left their jobs because of stated mental health reasons.Â This study showed that employees (millennials and Gen Z) want employers who care about their wellbeing. Contributing factors to mental health stress centre around increases in uncertainty and include: Hybrid work environments and the side-effects: no socialization, no end time, no feedback, caring for others; changing rules around work often with poor communications & clarity; Â inconsistency & incompleteness of rule implementation:Â Uncertainty from these and other factors leads to anxiety and depression.
The real story here is not that burnout, stress, depression and anxiety are becoming the number one reasons for absenteeism but that for a large part they are preventable. We have the data telling us itâs the problem but still organisations are doing very little to proactively manage it. Sure, we have counselling services for staff who are struggling and wellness days to reinforce feelings of wellbeing, but this is not enough.
If we start caring and developing work cultures that do not create unintentional stress through how work gets done, that will go a long way to change the status quo. Simple things like ensuring your culture doesnât thrive on fire drills and heroics to get things done and that emails do not come with expected responses after hours or over the weekend. If we can stop managers bullying, yelling or losing their cool when there is a performance or customer issue and begin giving people more control over their work – all of these are the kinds of stuff that contribute to weakened mental health and absenteeism.
To sum up, your staffâs stress levels are directly proportional to your businessâs absentee levels.Â Ergo, lowering the former, will also reduce the latter.Â Stress down, productivity up and everybody wins out.
Contributing factors to mental health stress centre around increases in uncertainty and include: Hybrid work environments and the side-effects: no socialization, no end time, no feedback, caring for others; changing rules around work often with poor communications & clarity; Â inconsistency & incompleteness of rule implementation:Â Uncertainty from these and other factors leads to anxiety and depression.
In September 1978, General Atiku, Princess Diana had enrolled for a cookery course. That same month whilst she was staying at her parentsâ home in Norfolk, her friends innocently asked about the health of her fatherÂ John Spencer, the 8th Earl. Hitherto, the Earlâs health had never been a matter of concern but Diana somewhat inscrutably voiced a somewhat portendous outlook. âHeâs going to drop down in some way,â she said.Â âIf he dies, he will die immediately; Â otherwise heâll survive.âÂ Â
It came to pass, Â General. The following day, the telephone bell rang to the news that her father had collapsed in the courtyard of his Althorp Estate residence and that he had been rushed to a nearby hospital after suffering a massive cerebral haemorrhage. The medical prognosis was bleak: Â Earl Spencer was not expected to survive the night. Writes Andrew Morton in Diana Her True Story: âFor two days the children camped out in the hospital waiting-room as their father clung on to life. When doctors announced that there was a glimmer of hope, Raine [second wife] organised a private ambulance to take him to the National Hospital for Nervous Diseases in Queen Square, Central London, where for several months he lay in a coma.â
Raine was so fiercely protective of her beloved husband that she had the nurses see to it that his own children did not come near him in this critical condition in his elitist private room. Â âIâm a survivor and people forget that at their peril,â she would later tell a journalist. âThereâs pure steel up my backbone. Nobody destroys me, and nobody was going to destroy Johnnie so long as I could sit by his bed â some of his family tried to stop me â and will my life force into him.â But if Raine had steel in her, General, so did the implacable Spencer children, more so the eldest of them all.Â âDuring this critical time,â Morton goes on, âthe ill feeling between Raine and the children boiled over into a series of vicious exchanges. There was iron too in the Spencer soul and numerous hospital corridors rang to the sound of the redoubtable Countess and the fiery Lady Sarah Spencer [the Earlâs firstborn child] hissing at each other like a pair of angry geese.â
As Diana had correctly predicted, her father was not destined to die at that juncture but healthwise he was never the same henceforth. First, he suffered a relapse in November that same year and was moved to another hospital. Once again, he teetered on the brink. He was drifting in and out of consciousness and as such he was not able to properly process Â people who were visiting him, including his own daughters when nurses relented and allowed them in. Even when he was awake a feeding tube in his throat meant that he was unable to speak. Understandably, Diana found it hard to concentrate on the cookery course she had enrolled in a few days before her father suffered his stroke.
But Raine, General,Â was determined that her husband survive come rain or shine. Morton: âWhen his doctors were at their most pessimistic, Raineâs will-power won through. She had heard of a German drug called Aslocillin which she thought could help and so she pulled every string to find a supply. It was unlicensed in Britain but that didnât stop her. The wonder drug was duly acquired and miraculously did the trick. One afternoon she was maintaining her usual bedside vigil when, with the strains of Madam Butterfly playing in the background, he opened his eyes âand was backâ. In January 1979, when he was finally released from hospital, he and Raine booked into the Dorchester Hotel in Park Lane for an expensive month-long convalescence. Throughout this episode the strain on the family was intense.â
Altogether, Earl Spencer had been in hospital for 8 straight months. The lingering effects of the stroke left him somewhat unsteady on his feet when he escorted his daughter down the aisle at St. Paul’s Cathedral in 1981 for her marriage to the Prince of Wales.
R.I.P. EARL SPENCER
It was not until March 29, 1992, General, that Earl Spencer finally gave up the ghost. He was admitted in hospital for pneumonia but what killed him days later was a heart attack. Rumours of his death actually began to make the rounds the day before he passed on. At the time, Diana was on a skiing holiday in theÂ Austrian Alps along withÂ her estranged hubby Prince Charles and their two kids William and Harry.
When Diana was told of her dadâs death, she insisted that under no circumstances would she return to England on the same flight as Charles, with whom she was barely on talking terms. âI mean it, Ken,â she told her body minder Ken Wharfe. âI donât want him with me. He doesnât love me â he loves that woman [Camilla]. Why should I help save his face? Why the bloody hell should I? Itâs my father who has gone. Itâs a bit bloody late for Charles to start playing the caring husband, donât you think so?â
Naturally, General, Charles was alarmed, particularly that his efforts to use one of his right-hand-men to reason with the Princess had been rebuffed. He thereforeÂ prevailed over Wharfe to try and ram sense into his wife. âLord Spencerâs death was a major news story,â writes Ken Wharfe, Â âand if the Prince and Princess did not return to Britain together then nothing, not even compassion for the grief-stricken Diana, would stop the journalists from going for the jugular. The truth about the Waleses would be immediately and blindingly obvious to the most naive journalist âŚ Returning to the Princessâs room, I told her bluntly that this was not a matter for debate. âMaâam, you have to go back with the Prince. This one is not open for discussion. You just have to go with itâ.ââ
At long last persuaded, General, Diana said, âOkay Ken, Iâll do it. Tell him Iâll do it, but it is for my father, not for him â it is out of loyalty to my father.â But what in truth got Diana to change tack was the intervention of the Queen, who personally called her at Charlesâ own request. That, however, General, was only as far as Diana was prepared to play ball: as far as engaging with Charles in conversation was concerned, that was simply inconceivable. âThere was an icy silence for the rest of the two-hour journey,â writes Wharfe. âNothing was said during the entire flight. The Princess did not want to speak to her husband and he, fearing a furious or even hysterical outburst, did not dare even to try to start a conversation. Whatever the discomforts of the journey, however, it was soon clear that the PR spin had worked. The next day it was reported that Prince Charles was at Dianaâs side in her hour of need. Yet as soon as the Prince and Princess arrived at Kensington Palace they went their separate ways â he to Highgrove, and she to pay her last respects to her father.â
Lord Spencer was 68 when he died. He was a remote descendant of King Henry VIII.
PRINCE CHARLES FINALLY OWNS UP TO ADULTERY WITH CAMILLA
In June 1994, when Diana and Charles had been separated for exactly one-and-half years, Prince Charles was interviewed in a BBC documentary by Jonathan Dimbleby. The interview was billed as intended to mark Charlesâ 25 anniversary as Prince of Wales but it was in truth a not-to-cleverly-disguised riposte to Diana Her True Story, the highly controversial 1992 collaboration between Diana and Andrew Morton.
In the interview, which was watched by 13 million people, Charles, General, openly admitted for the first time that he had committed adultery with Camilla Parker-Bowles, who he hailed as, âa great friend of mine who has been a friend for a very long time and will continue to be a friend for a very long timeâ. Diana had been requested to feature in the interview alongside her husband but she parried the overture on the advice of her aides, which was spot-on as she would have been greatly embarrassed by her hubbyâs unsavoury confession in her own face and on national television.
The Princeâs candid confessional was followed weeks later by a book titled TheÂ Prince of Wales: A Biography, which was written by the same Jonathan Dimbleby. The book was even frankier than the interview. In it, Charles put it bluntly that she had never once loved Diana and that he married her only because he was coerced into doing so by his Â notoriously overbearing father. Charles also made it known that as a child, he had been bullied by his abusive father, virtually ignored by his mother, and persecuted by a wife he portrayed as both spoiled and mentally unstable. Â Â Both Diana and his parents were revolted by the bare-knuckle Â contents of the book though Dana need not have been irked considering that it was she herself who had fired the first salvo in the Morton book.
BASHIR INTERVIEW BODES ILL FOR DIANA
If Dianaâs collaboration with Morton was a miscalculation, General, Prince Charlesâ Dimbleby interview was equally so. For in November 1995, the wayward Princess hit back with her own tell-all interview on BBCâsÂ current affairs programme called Panorama. âShe wanted to get even with Prince Charles over his adulterous confession with the Dimbleby documentary,â writes Paul Burrell, her final butler, in A Royal Duty.
The interview was conducted by journalist Martin Bashir who was attached to BBC, and was watched by 23 million people,Â conferring it the distinction of having attracted the largest audience for any television documentary in broadcasting history. In the interview, Diana voiced concern about there having been âthree of us in this marriage and so it wasÂ a bit crowdedâ, the intruder obviously being Camilla. Diana also gave Charles a dose of his own medicine by confessing to her own adulterous relationship with James Hewitt, of whom she said, âYes, I adored him, yes, I was in love with himâ. Hewitt had at the time documented his affair with Diana in lurid detail in a best-selling book and Diana thought he had ill-conceivedly stabbed her in the back.
And as if to rub salt into the wound, General, Diana cast serious Â doubts on her husbandâs fitness to rule as future King and therefore his eventual accession to the British throne. Â Â Unfortunately for her, the interview sealed her fate Â in so far as her marriage was concerned. âIn her headstrong decision to co-operate with Bashir,â says Burrell, âshe had never considered, perhaps naively, the implications that Panorama had for her marriage.â Indeed, just four weeks after the interview, the Queen, after consultation with the Prime Minister and the Archbishop of Canterbury, wrote personally to both the Prince and Princess of Wales requesting that they divorce sooner rather than later.
It was a dream-come-true for at least two parties to the triangle, namely Charles and Camilla. But did it also constitute music to the ears of Princess Diana too, General?
SOWING THE WIND ONLY TO REAP THE WHIRLWIND: Martin Bashir interviews Princess Diana in a BBC documentary which aired on Monday 29 November 1995. The interview incensed the Windsors: the following month, Queen Elizabeth ordered Charles and Diana to sever matrimonial ties. In her vengeful resolve to hit back at her husband following his own interview the previous year, Diana had foolishly sown the wind and reaped the whirlwind.
Islam is a way of life completed and perfected by the last and final Messenger of Allah, Prophet Muhammad (pbuh). The Holy Quran along with the practical teachings of the Prophet (pbuh) forms the basis of Islamic law, social, economic and political systems of Islam â in short the basis of a complete code of conduct for the entire life of a Muslim
Regrettably in this day and age there are certain views in non-Muslims that have a very negative âviewâ of Islam. The bottom line is that if a Muslim says that two plus two is four, others can âargueâ to say three plus one is four, or two times two is four or the square root of 16 is four. The bottom line is no matter what we may think we all are âcorrectâ. The fact is that we are all on this earth for a âlimitedâ time. Regardless of beliefs, tribe, race, colour or our social standing in life, we will all die one day or the other and we will âallâ be called up thereafter to answer for our behaviour, beliefs, and our life on this earth.
To a Muslim the Holy Quran is the Divine Revelation which is all encompassing and lays down in clear terms, how we should live our daily lives including the need for humans to allow fellow humans certain basic rights at all times. Due to the limited space available I can only reflect on some of the major fundamental rights laid down by Islam:
Right to life
The first and foremost of fundamental basic human-rights is the right to life. âWhosoever kills any human being (without any valid reason) like manslaughter or any disruption and chaos on earth, it is though he had killed all the mankind. And whoever saves a life it is though as he had saved the lives of all mankindâ (Quran Ch5: v 32). It further declares: âDo not kill a soul which Allah has made sacred except through the due process of lawâ (Quran Ch6: v 151). Islam further explains that this sacrosanct right to life is not granted only to its adherents (believers), but it has been granted to all human beings without consideration of their religion, race, colour or sex
Right to EqualityÂ
The Holy Quran recognises equality between humans irrespective of any distinction of nationality, race, colour or gender. âO Mankind We have created you from a male and female, and We made you as nations and tribes so that you may be able to recognise each other (not that you may despise each other). Indeed the most honourable among you before God is the most God-consciousâ. (Quran Ch49: v 13). The Prophet Muhammed (pbuh) further explained this: âNo Arab has any superiority over a non-Arab, nor does a non-Arab have any superiority over an Arab…… You are all the children of Adam and Adam was created from soilâ. If there is any superiority for a man it is based on his piety, righteousness, sense of responsibility and character. Even such a person with these noble qualities would not have any privileged rights over others.
Right to justice
Allah Almighty has bestowed on all human beings, believer or non-believer, friend or foe the right to justice.Â The Holy Quran states: âWe sent our messengers with clear teachings and sent down along with them the Book and the Balance so that society may be established on the basis of justiceâ (Quran Ch 57 : v 25). It further says âO Believers stand for the cause of God and as witness to justice and remember that enmity of some people should not lead you to injustice. Be just as it is nearest to God consciousnessâ (Quran Ch 5:vÂ 8 ). This makes it obligatory that a believer must uphold justice in all circumstances, including to his enemies.
Right to freedom of conscience and religion
The Holy Quran clearly mentions that there is no compulsion in accepting or rejecting a religion. âThere is no compulsion in (submitting to) the religionâ (Quran Ch 2 : v 256). Every individual has been granted basic freedom to accept a religion of his or her choice. Therefore no religion should be imposed on a person.
Right to personal freedom
No person can be deprived of his or her personal freedom except in pursuance of justice. Therefore there cannot be any arbitrary or preventive arrest without the permission of duly appointed judge and in the light of a solid proof.
Right to Protection of Honour
Every person has been ensured basic human dignity which should not be violated. If someone falsely attacks the honour of a person the culprit will be punished according to the Islamic Law. The Holy Quran says: âDo not let one group of people make fun of another groupâ. It further states: âDo not defame one anotherâ, the Quran goes on to say: And do not backbite or speak ill of one anotherâ (Quran Ch 49Â : v 11-12).