On 23 July 2020, the Department of Mineral Resources and Energy (DMRE) launched the Carbon Offset Administration System (COAS) which will allow carbon tax liable entities to further reduce their carbon tax through an additional tax relief mechanism known as the carbon offset allowance. An offset price lower than the current carbon tax price (R120/tCO2e for 2019) will generate a saving for carbon tax liable entities.
Climate Neutral Group’s portfolio of eligible offsets comprises a wide range of project types such as landfill gas to energy, renewable energy and energy efficiency as well as the Group’s flagship Wonderbag project. These offsets can be used within the first phase of the carbon tax (1 June 2019 – 31 Dec 2022).
The approval process of an offset project is extensive as it needs to be located in South Africa only and registered under either the Clean Development Mechanism, Gold Standard or the Verified Carbon Standard, amongst other qualifying criteria by the DMRE.
The deadline for carbon tax submission is fast approaching (29 October 2020) and there are a few additional steps that need to be followed in order for entities to make use of this additional tax relief mechanism. A carbon tax offset certificate (Regulation 8(e) of the Carbon Offset Regulations) must be generated by the COAS and then submitted to SARS before making payment of your final carbon tax liability.
Climate Neutral Group can assist with all the steps required to ensure that your company receives this tax relief mechanism for the 2019 period. Get in contact with one of our carbon tax advisors below:
Silvana.claassen@climateneutralgroup.com or Teegan.govindasamy@climateneutralgroup.com.
> Begin the registration process with the Carbon Offset Administration System.
Climate Neutral Group can provide your company with a variety of carbon-related services that include:
- Carbon management & offsetting advisory firm
- Mandatory reporting
- Carbon tax liability
- Carbon offset development
- Assistance with setting up your COAS account
- Carbon footprint and (CDP) reporting
- Low carbon transition plans
