Category: CHAPTER II – The Taxes (ITA)

“Adjusted taxable income” definition of section 23N of ITA

Posted on by admin_kmos

“adjusted taxable income” means taxable income calculated before applying this section and before setting off any balance of assessed loss that has been carried forward from the preceding year of assessment: Provided that the result of the calculation may not be less than zero-

(a)     reduced by-

(i)      any amount of interest received or accrued that forms part of taxable income;

[Subsection (i) substituted by section 42 of Act 23 of 2018 effective on 17 January 2019]

(ii)     any amount included in the income of a person as contemplated in section 9D(2);

(iii)    any amount recovered or recouped in respect of an allowance contemplated in this Act in respect of a capital asset as defined in section 19; and

[Subparagraph (iii) amended by section 38 of Act 43 of 2014 effective on 1 January 2015]

(b)     with the addition of-

(i)      any amount of interest incurred that has been allowed as a deduction from income;

[Subsection (i) substituted by section 42 of Act 23 of 2018 effective on 17 January 2019]

(ii)     any amount allowed as a deduction in terms of this Act in respect of a capital asset as defined in section 19 for purposes other than the determination of any capital gain or capital loss;

[Subparagraph (ii) amended by section 38 of Act 43 of 2014 effective on 1 January 2015]

(iii)    75 per cent of the receipts or accruals derived from the letting of any immovable property; and

[Subparagraph (iii) amended by section 38 of Act 43 of 2014 effective on 1 January 2015]

(iv)    any assessed loss or balance of assessed loss allowed to be set off against income in terms of section 20;

[Subparagraph (iv) added by section 38 of Act 43 of 2014 effective on 1 January 2015]

[Definition of “adjusted taxable income” amended by section 42(1)(a) of Act 23 of 2018 and by section 19(1)(a) of Act 42 of 2024 effective on 1 January, 2025 and applicable in respect of years of assessment commencing on or after that date. Subparagraph (iv) added by section 38(1)(d) of Act 43 of 2014 effective on 1 January, 2015 and applicable in respect of years of assessment commencing on or after that date]

“Road pavement” definition of section 24G of ITA

Posted on by admin_kmos

“road pavement” means the road surface, road shoulders, sub base, base course, wearing courses, road signage, road markings, lighting, guard rails, tolling equipment, emergency telephone systems, emergency telephone repeater stations, access roads to emergency telephone repeater station sites and other parts and road furniture of a toll road, excluding any permanent work or ancillary service;

“Acquisition transaction” definition of section 23N of ITA

Posted on by admin_kmos

‘acquisition transaction’ means any transaction-

(a)     in terms of which an acquiring company acquires an equity share in an acquired company that is a company as contemplated in paragraph (a) or (b) of the definition of “acquisition transaction” in section 24O(1); and

[Paragraph (a) substituted by section 40 of Act 25 of 2015 effective on 1 January 2016]

(b)     as a result of which that acquiring company, as at the end of the day of that transaction, becomes a controlling group company in relation to that acquired company;

[Paragraph (b) substituted by section 40 of Act 25 of 2015 effective on 1 January 2016]

“Permanent work” definition of section 24G of ITA

Posted on by admin_kmos

“permanent work” means –

 

(a)     any earthwork, tunnel, bridge, or structure forming part of a toll road, including any building erected for the purpose of housing toll equipment, but excluding any such work constructed or erected solely for the purposes of the repair or maintenance of a toll road; and

 

(b)     the reimbursement for the cost of acquisition or expropriation of land required for the purposes of the toll road; and

 

(c)     any payment made to the South African National Roads Agency Limited in respect of the acquisition of the right to operate a toll road;

“Acquiring company” definition of section 23K of ITA

Posted on by admin_kmos

(1)       For the purposes of this section-

 

“acquiring company” means-

 

(a)     a transferee company contemplated in the definition of “intra-group transaction” in section 45(1);

 

(b)     a holding company contemplated in the definition of “liquidation distribution” in section 47(1); or

 

(c)     a company that acquires an equity share in another company in terms of an acquisition transaction;

“Acquiring company” definition of section 23N of ITA

Posted on by admin_kmos

‘acquiring company’ means-

(a)     a transferee company contemplated in the definition of ‘intra-group transaction’ in section 45(1);

(b)     a holding company contemplated in the definition of ‘liquidation distribution’ in section 47(1); or

(c)     a company that acquires an equity share in another company in terms of an acquisition transaction;

“Ancillary service” definition of section 24G of ITA

Posted on by admin_kmos

“ancillary service” in relation to a toll road, means any –

 

(a)     vehicle service station, breakdown or repair facility;

 

(b)     shop or restaurant;

 

(c)     park, recreation or rest area;

 

(d)     emergency medical or first–aid facility;

 

(e)     hotel or other accommodation; or

 

(f)      entertainment facility,

 

or other service or facility to which persons or vehicles may gain access from the toll road;

Subsections 2, 3 and 4 of section 23G of ITA

Posted on by admin_kmos

(2)     Where the receipts or accruals of any person, who is a lessee or sublessee in relation to a sale and leaseback arrangement, do not for the purposes of this Act constitute income of such person –

(a)     any amount which is received by or accrues to any lessor in relation to such sale and leaseback arrangement, shall be limited to an amount which constitutes interest as contemplated in section 24J; and

(b)     such lessor shall, notwithstanding the provisions of this Act, not be entitled to any deduction in terms of section 11(e), (f), (gA) or (gC) or sections 12B, 12BA, 12C, 12DA, 13 or 13quin in respect of an asset which is the subject matter of such sale and leaseback arrangement.

[Paragraph (b) substituted by section 30 of Act 31 of 2005, by section 35 of Act 35 of 2007, by section 40 of Act 23 of 2018 and by section 25(1) of Act 17 of 2023 effective on 1 March, 2023 and applicable in respect of assets brought into use on or after that date]

(3)     Where the receipts or accruals of any person, who is a lessor in relation to a sale and leaseback arrangement, arising from such arrangement do not for the purposes of this Act constitute income of such person, any deduction to which a lessee or sublessee in relation to such sale and leaseback arrangement is entitled under the provisions of this Act shall, subject to the provisions of section 11(f), be limited to an amount which constitutes interest as contemplated in section 24J.

(4)     The provisions of subsection (2)(a) shall not apply to any person who is both a lessor and a lessee in relation to the same sale and leaseback arrangement during any year of assessment.