Out the box tax thinking BUT between the lines

Eugene Bendel, a specialist tax adviser, has been "ruffling a few feathers" in the South African tax planning landscape since he made his ground-breaking findings that billions of tax is due to taxpayers where they, or a family member, suffers from a ment

Bendel, who was Senior Tax advisor with Werksmans Attorneys, a Johannesburg law firm, recently left them to establish his own specialist tax practice, Bendels Consulting.  Bendel was formerly a Senior Tax advisor with Deloitte in Johannesburg and before that spent seven years in London.  In London, he was a Senior Tax advisor with KPMG and advised many of worlds leading investment banks on tax structured finance.  Bendel qualified as a Chartered Accountant in 1991 and also obtained a Masters of Tax Law Degree (UCT -1993).  "I feel that with my academic background accounting and legal and high-level tax experience in both South Africa and London, I am well placed to provide niche tax services to my clients," Bendel says.  

Bendel is quick to point out that while his findings in relation to medical expenses for mental illnesses are a little bit sensitive, he does not believe that they are in any way controversial.  "There is no 'smoke and mirrors' with the roll-out of this literal and factual interpretation of the appropriate tax laws," Bendel says.  Bendel has given conferences on this, but add that some people think the findings are too good to be true. 

"My approach to tax planning is simple I like to think out of the box which means that I can get quite creative and innovative.  But, any plan, or tax saving strategy, must clearly be between the lines.  That is within the strict and literal interpretation of the appropriate laws.  I am not a fan of using 'smoke and mirrors' in my tax plans which is why I can speak openly about them." 

There is a lot of work to do South Africa have approximately 5 million registered taxpayers and the issue affects, in Bendels rough estimation, about 20% of taxpayers.  That means that one million taxpayers could, in some way, benefit from Bendels findings.  "Even though I cannot assist all affected taxpayers directly, it is gratifying to know that I will assist them in an indirect way with my findings," Bendel says.

Another tax planning idea Bendel has 'stumbled' upon is centred round fringe benefits.  With many people still being employed over the age of 65, it appears that if an employer pays medical expenses for a relative (say, a grand-child) of an over 65 year old employee, then the medical expenses paid by the employer should not be subject to fringe benefits tax.  If the employer paid the amount as a bonus to the employee instead of paying the medical expenses of the grand-child, the bonus would be fully taxable. 

Bendel agreed to reveal another tax planning idea exclusively for the next edition of FAnews in the special focus on 'Women in Insurance'.