24K. Incurral and accrual of amounts in respect of interest rate agreements
Category: Section 24K (ITA) – Incurral and accrual of amounts in respect of interest rate agreements
Section 24K
- Subsection (2) substituted by section 15 of Act 16 of 2004.
- Section 24K inserted by section 20 of Act 28 of 1997.
“Interest rate agreement” definition of section 24K of ITA
(1) For the purposes of this section “interest rate agreement” means any agreement in terms of which any person –
(a) acquires the right to receive –
(i) an amount calculated by applying any rate of interest to a notional principal amount specified or referred to in such agreement; or
(ii) an amount calculated with reference to the difference between any combination of rates of interest applied to a notional principal amount specified or referred to in such agreement; or
(iii) a fixed amount specified or referred to in such agreement as consideration in terms of such agreement whereunder the obligation is imposed to pay any other amount as contemplated in paragraph (b) (i) in terms of such agreement or an amount equal to the difference between such fixed amount and such other amount; or
(b) becomes liable to pay –
(i) an amount calculated by applying any rate of interest to a notional principal amount specified or referred to in such agreement; or
(ii) an amount calculated with reference to the difference between any combination of rates of interest applied to a notional principal amount specified or referred to in such agreement; or
(iii) a fixed amount specified or referred to in such agreement as consideration in terms of such agreement whereunder the right is acquired to receive any other amount as contemplated in paragraph (a) (i) in terms of such agreement or an amount equal to the difference between such fixed amount and such other amount.
Subsections 2 and 3 of section 24K of ITA
(2) Any amount contemplated in the definition of “interest rate agreement” in subsection (1) shall for the purposes of this Act be deemed to have been incurred by or accrued to, as the case may be, a person contemplated in such definition on a day to day basis during the period in respect of which it is calculated.
(3) Where any amount contemplated in subsection (2) is to be calculated with reference to a variable rate for the purposes of such subsection, such amount shall be calculated with reference to the variable rate applicable on the date such amount is to be calculated to determine all amounts payable or receivable after such date.