Author: admin_kmos

“Severance benefit” definition of section 1 of ITA

Posted on by admin_kmos

“severance benefit” means any amount (other than a lump sum benefit or an amount contemplated in paragraph (d)(ii) or (iii) of the definition of “gross income”) received by or accrued to a person by way of a lump sum from or by arrangement with the person’s employer or an associated institution, as defined in paragraph 1 of the Seventh Schedule, in relation to that employer in respect of the relinquishment, termination, losections repudiation, cancellation or variation of the person’s office or employment or of the person’s appointment (or right or claim to be appointed) to any office or employment, if-

 

(a)     such person has attained the age of 55 years;

 

(b)     such relinquishment, termination, loss, repudiation, cancellation or variation is due to the person becoming permanently incapable of holding the person’s office or employment due to sickness, accident, injury or incapacity through infirmity of mind or body; or

 

(c)     such termination or loss is due to-

 

(i)      the person’s employer having ceased to carry on or intending to cease carrying on the trade in respect of which the person was employed or appointed; or

 

(ii)      the person having become redundant in consequence of a general reduction in personnel or a reduction in personnel of a particular class by the person’s employer,

 

unless, where the person’s employer is a company, the person at any time held more than five per cent of the issued shares or members’ interest in the company:

 

Provided that any such amount which becomes payable in consequence of or following upon the death of a person must be deemed to be an amount which accrued to such person immediately prior to his or her death;

[Definition of “severance benefit” inserted by section 6(1)(zF) of Act 7 of 2010 and amended by section 7(1)(zK) and (zM) of Act 24 of 2011 and by section 1(1)(n) of Act 5 of 2026 effective on 1 March, 2026 and applicable in respect of years of assessment commencing on or after that date]

“Year of assessment” definition of section 1 of ITA

Posted on by admin_kmos

“year of assessment” means any year or other period in respect of which any tax or duty leviable under this Act is chargeable, and any reference in this Act to any year of assessment ending the last or the twenty-eighth or the twenty-ninth day of February shall, unless the context otherwise indicates, in the case of a company or a portfolio of a collective investment scheme in securities be construed as a reference to any financial year of that company or portfolio ending during the calendar year in question.

“Trading stock” definition of section 1 of ITA

Posted on by admin_kmos

“trading stock” includes –

(a)        includes-

(i)      anything produced, manufactured, constructed, assembled, purchased or in any other manner acquired by a taxpayer for the purposes of manufacture, sale or exchange by the taxpayer or on behalf of the taxpayer;

(ii)     anything the proceeds from the disposal of which forms or will form part of the taxpayer’s gross income, otherwise than-

(aa)   in terms of paragraph (j) or (m) of the definition of ‘gross income’;

(bb)   in terms of paragraph 14(1) of the First Schedule; or

(cc)   as a recovery or recoupment contemplated in section 8(4) which is included in gross income in terms of paragraph (n) of the definition of ‘gross income’; or

(iii)    any consumable stores and spare parts acquired by the taxpayer to be used or consumed in the course of the taxpayer’s trade; but

(b)        does not include-

(i)         a foreign currency option contract ;or

(ii)        a forward exchange contract,

as defined in section 24I(1);