Category: Paragraph 33 (Eighth Schedule) – Part-disposals

Paragraph 33

 

  1. Item (3)(b) amended by section 71 of Act 31 of 2005.

 

  1. Item (3)(c) deleted by section 61 of Act 32 of 2004 and added by section 71 of Act 31 of 2005.

 

  1. Paragraph 33 substituted by section 80 of Act 74 of 2002 and section 99 of Act 45 of 2003.

Paragraph 33 (Eighth Schedule) – Part-disposals

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33.     Part-disposals

 

(1)     Subject to subparagraphs (2), (3), (4) and (5), where part of an asset is disposed of-

 

(a)     the proportion of the expenditure attributable to the part disposed of is an amount which bears to the expenditure allowable in terms of paragraph 20 in respect of the entire asset the same proportion as the market value of the part disposed of bears to the market value of the entire asset immediately prior to that disposal; and

 

(b)     the market value on valuation date attributable to the part disposed of is an amount which bears to the market value adopted or determined in terms of paragraph 29(4) in respect of the entire asset the same proportion as the market value of the part disposed of bears to the market value of the entire asset immediately prior to that disposal.

 

(2)     Subject to subparagraph (4), where a part of the expenditure allowable in terms of paragraph 20 or the market value adopted or determined in terms of paragraph 29(4) in respect of an asset can be directly attributed to the part of the asset that is disposed of or retained then the apportionment contemplated in subparagraph (1) does not apply in respect of that part of that expenditure or market value as the case may be.

 

(3)     For the purposes of subparagraph (1) and (2) there is no part-disposal of an asset by a person in respect of-

 

(a)     the granting of an option by that person in respect of an asset;

 

(b)     the granting, variation or cession of a right of use or occupation of that asset by that person in respect of which no proceeds are received by or accrue to that person;

 

(c)     the improvement or enhancement of immovable properly which that person leases from a lessor; or

 

(d)     the replacement of part of that asset in repairing that asset.

 

(4)     Where proceeds are received by or accrue to a person in respect of the granting, variation or cession of a right of use or occupation of an asset by that person, the portion of the expenditure allowable in terms of paragraph 20 or market value adopted or determined in terms of paragraph 29(4) attributable to the part of the asset in respect of which those proceeds were received or accrued is an amount which bears to that expenditure or market value as the case may be of the entire asset the same proportion as those proceeds bear to the market value of the entire asset immediately prior to that disposal.

 

(5)     Where a person has adopted the 20 percent of proceeds method contemplated in paragraph 26(1)(b) in determining the valuation date value of a part of an asset that has been disposed of, that person must adopt that method in determining the valuation date value of any remaining part of that asset.